As part of the Pension Counseling and Information Program, the Pension Rights Center receives calls from people who have problems with or questions about their retirement plans. The people who call us are often located within the jurisdiction of a Pension Counseling and Information Project. When this happens, we refer the callers to the appropriate counseling project for help. This is what happened when Frank called us. His former company is based in Missouri, so we referred him to the South Central Pension Rights Project, which covers Arkansas, Louisiana, Missouri, New Mexico, Oklahoma, and Texas.
When he retired after a 26-year career as a technician at a biotechnology firm, Frank chose to receive his pension in a way that would stabilize his income throughout his retirement. Called a level-income option, Frank’s pension would pay him $1,138 per month until he reached age 65, at which point Frank would start receiving Social Security and his monthly pension would be reduced to $272.
After he reached age 65, Frank noticed that his benefit had not been reduced as it should have been. He called the pension plan administrator explaining that his benefit was incorrect and that it should be reduced. Frank was told that he was wrong and that his pension was the right amount. The company had undergone numerous mergers, so Frank figured company knew what it was doing and he let the matter rest.
More than 11 years later, the company discovered its error and sent Frank a letter, asking him to repay the $120,000 that it had overpaid him. This is when Frank contacted us. Like many retirees, he wasn’t able to write a check for tens of thousands of dollars to his pension plan. Fortunately, the South Central Pension Rights Project had worked with many retirees whose pension plans have made errors and are trying to recoup their losses.
Using their prior experience, the staff of the South Central Pension Rights Project wrote to the company on Frank’s behalf, requesting a waiver of recoupment. The waiver request was based on financial hardship, the fact that the error went undetected for so long, and the amount of the overpayment. A few months later, the company informed Frank that it had forgiven the entire overpayment because repaying $120,000 would impose a significant financial hardship on him, a 77-year-old retiree.
To date, the South Central Pension Rights Project has recovered more than $9 million in retirement benefits for its clients. The project may be reached at (800) 443-2528 or online at www.southcentralpension.org.
Learn about the Pension Counseling and Information Program.