just wondering in case Sears / Kmart goes through bk
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the amount of your reduction in your pension is salary dependent. Lower paid employees get a higher percentage of their pension than highly paid employees, per my recollection
When Kmart went bankrupt all the company matching money in your 401k was lost. The company match (yes they actually had that back then) was all in stock that was worthless. So basically the only money I have in my 401k is my own and I would have done better to have put it in an IRA from the beginning
Okay your 401k is safe always depending on what you are invested in. You make the decision as far as to which funds you want to contribute.
My financial rep at Ameriprise said that your 401k is protected during a BK, they cannot touch it. As far as pensions, the PBGC supposedly will insure that you get what is coming to you... but.... it's possible that you will get a slight reduction of some sort. This is only a concern if you have hundreds of thousands in the pension... (a long term employee with 25 to 30+ years).... otherwise if you have 50,000 or less not saying the potential reduction is 'good' but it won't hurt you as much ... again we don't know until it happens. I know many long timers (30+) who left because they wanted to cash out their pension money due to this uncertainty. I was also told not to carry company stock in your 401k (i.e. Enron, Kmart... etc) .... sold mine about 7 or 8 years ago. Under normal circumstances taking the annuity on the pension could be a good choice (pays out close to 7 percent of balance per year) but under these circumstances my Chase banker suggested taking the 50% and investing in an IRA (we are stuck leaving 50% in). Everyone's situation is different but a good time to get some advice from your accountant, lawyer or other advisor before the boom is lowered. Be careful when you roll over your 401k or pension so you don't get a big tax bill from the IRS. You are also entitled to unemployment even if you get a severance., Also Obama care might be cheaper than COBRA, you have to do some homework first.
@RzFABHj-eyn That will also be happening here at Sears. A lot of people are really delusional that they can't even seem to see the reality that as soon as the company goes under loyalty means nothing.
People that have worked close to a lifetime will just get screwed at this point. Its sad the forshadow that is coming what happened to you will happen to others.
@csw - No, I didn't lose one cent in my 401k when I got laid off. I believe what the poster was trying to say was that their saving plan consisted entirely of Kmart stock and when the Kmart stock went to zero, so did their savings plan.
So......those being laid off now are losing everything they earned in their 401K?
I worked at Kmart in 2002. Lost everything in my savings plan and stock I had went to zero. Received nothing for compensation, not even worthless stock. At that time I had worked there 25 years....get out now....
So from what I understand Basically severance is the way SHC “pays off” employees so they are not liable in a law suit? Now it makes so much more sense! They pay out severance and make you sign your rights away to get they money so they don’t have to deal with the possibility of going to court. They know they have done things that would not look good in court.
No, the real reason they do the tpp is you now have to sign away your rights to sue the company. The company was havng to defend themselves in the early 2000s when work force reductions were based on performance.
Totally different company, totally different management, totally different financial situation from 2002 to today. Most likely you will get nothing. See what happened with Sears Canada to get a clue as to what might happen.
My mom ended up with 300+ shares of worthless stock.