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Stop, Look & Listen: Railroad Retirement Benefits Q&A

Answers are provided by Robert S. Kaufman

Looking For Gold In Old Railroad Pension Plans!

(Posted June 4, 2004)

Question 459: My father worked for the New York Central Railroad. He had a pension (before Railroad Retirement started) from the railroad and the Vanderbilt Pension Plan. How do we find out if there is anything in the old pension plan for his children?

Answer: I don't have any specific information about the Vanderbilt Pension for NYC employees. But I can tell you it is highly unlikely that your family would be entitled to anything at this late date.

Railroads were among the earliest U.S. industries to set up pension plans for their workers. Some of the plans were started in the 1890s. But the concepts of vesting and trust funding did not exist then. Pensions usually were paid from the Railroad's operating funds. And when the railroad ran into hard financial times, pensions were either reduced or eliminated. Bankruptcy happened a lot to railroads; any claims from current and future pensioners were wiped out when a railroad went into bankruptcy.

Most railroad pensions ran out of funds and stopped paying benefits during the depression of the 1930s. That was the major reason that the Railroad Retirment system was created in 1934. It was intended to protect earned pension benefits and to allow rail workers to preserve their credits when they changed railroads.

Important notice:

Answers are provided as general guidance on the subjects covered in the question and are not provided as legal advice to the questioner or to readers. Any legal issues should be reviewed by your legal counsel to apply the law to the particular facts of this and similar situations.

The law in this area changes frequently. Answers are believed to be correct as of the posting dates shown. The completeness or accuracy of a particular answer may be affected by changes in the law (statutes, regulations, rulings, court decisions, etc.) that occur after the date on which a particular Q&A is posted.

Copyright 1997-2017 Robert S. Kaufman
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