US musicians are told to expect lower pensions

Message received:

Today, the American Federation of Musicians and Employers’ Pension Fund informed participants that the Plan has applied to the U.S. Treasury Department to reduce earned benefits under the Multiemployer Pension Reform Act (MPRA). The Plan is currently in “critical and declining” status, which means it is projected to run out of money to pay benefits (or become “insolvent”) within 20 years. Under MPRA, if a Plan is in “critical and declining” status, the Trustees can apply to Treasury for approval to reduce participants’ benefits by an amount sufficient for the Plan to avoid insolvency. If approved, the benefit reductions would go into effect on January 1, 2021.

Here‘s what the Plan’s participants have been sent.

About 53% of participants would have no reduction.
About 45% of participants would have their benefits reduced between 0% and 19%.
Less than 2% of participants would have their benefits reduced between 20% and 40%.