Our Pension Funds' Status
Our 1199SEIU Pension Funds, like every pension fund in the country, experienced an enormous loss of monies during the stock market crash of 2008. As we witnessed, 2009 was a better year for the market, with the country experiencing a very gradual economic recovery. As a result, the asset returns in our pension funds improved last year. We are not completely out of the woods, however. The assets, although recovering, are still well below where the Funds stood before the stock market crash. And the funds are still considered "under-funded" under the federal Pension Protection Act. However, the good news is that we are on the road to recovery with the help of our new collective bargaining agreements. And as we always have, we will continue to monitor and carefully invest your pension funds' assets to ensure your financial security in your retirement years.
Your Defined Benefit Pension Plan vs. a 401(k) or 403(b)
1199SEIU members have one of the richest benefit packages in the country including a Defined Benefit pension plan, which sets you apart from most American workers.
What is a Defined Benefit pension plan?
With defined benefit pension plans like ours, once you are vested you have the right to a pension when you retire. You’ll get a set amount each month for the rest of your life. Your employer pays into the Pension Fund for your retirement, and those contributions are pooled. These assets are managed collectively and invested, pursuant to a disciplined policy, to support pension benefits for all of our members.
How is that different from a 401(k) or 403(b)?
The people we all know who have lost so much of their individual retirement savings had defined contribution plans – 401(k)s and 403(b)s. With those plans, workers put their own money into an individual account. Employers sometimes match these contributions, but often they do not. There is no set, fixed monthly amount that the worker can count on at the time of retirement. Workers manage their own money, and if the stock market fails, whatever money is lost is difficult to recoup, unless they can wait a very long time to retire.
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How Your Pension Benefits Are Invested
The Trustees of our Fund oversee and monitor the work of our Investment Team, which handles the day-to-day management of the Fund’s investments. The team works with a variety of investment managers to ensure that the Fund’s assets are invested in a broad array of investment opportunities within the allocation policy set by the Trustees, maximizing returns while protecting against losses. This disciplined and diversified investment strategy served us and other funds well for many years. But the economy’s dramatic plunge in 2008 hit all areas across the board and no asset class, and therefore, no pension fund was immune.
If you want to receive more information about the Fund’s investments, you can request it by writing to the Pension Department at 330 West 42nd St, 10th Floor, New York, NY 10036.
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Who to Contact with Questions
Please contact your Delegate or Organizer if you have any questions about negotiations or your contract. For questions about your pension benefits or your Fund, contact us at pension@1199funds.org.