Market Overview

This Day In Market History: Pension Benefit Guaranty Corp. Makes First Payout

This Day In Market History: Pension Benefit Guaranty Corp. Makes First Payout

Each day, Benzinga takes a look back at a notable market-related moment that occurred on this date.

What Happened?

On this day in 1975, the Pension Benefit Guaranty Corp. paid out its first check.

Where The Market Was

The S&P 500 was trading at 81.59 and the Dow closed the day at 739.05.

What Else Was Going On In The World?

In 1975, the Vietnam War officially ended when communist forces took control of Saigon. In the U.S., the movie “Jaws” was a blockbuster hit. The U.S. inflation rate was 9.2 percent.

Government-Backed Pensions

Company-sponsored pension plans are only as secure as the companies running them — or at least that’s how it was prior to 1975. The Employee Retirement Income Security Act of 1974 established the PBGC, a U.S. government entity that guarantees private pension payments when companies can’t afford to make their payments. The PBGC was created after several major U.S. companies, including Studebaker, failed to meet their pension payment obligations when they became insolvent.

The PBGC is funded via insurance premiums that are paid by the companies whose plans it protects, as well as investments and assets it takes over from companies formerly responsible for plans. The PBGC is not funded by U.S. taxpayers.

In February 1975, the PBGC officially cut its first pension check, a $140.75 payment to a participant in the International City Bank of New Orleans Employees Retirement Plan.

In 2016, the PBGC paid out benefits to nearly 840,000 retirees. As of 2017, the PBGC paid out a monthly maximum of $5,369.32 to retirees.

Related Links:

This Day In Market History: The Original Glass-Steagall Act Is Passed

GE Reduces Pension Liabilities by 8 Percent, Still Faces Huge Burden


Related Articles

View Comments and Join the Discussion!

Posted-In: pensions retirement this day in market historyEducation Top Stories Markets General Best of Benzinga

Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at