Is Your TPMG Pension Safe? Understanding the Annual Funding Notice

As a physician with The Permanente Medical Group (TPMG), ensuring the safety and stability of your pension is an essential part of helping to secure your financial future. With recent high-profile pension plan collapses and ongoing uncertainties about long-term projections for pension weakness, understanding the Annual Funding Notice (AFN) for the TPMG Plan 1 pension is more critical than ever. Let’s delve into what physicians need to know about the AFN, and what recent data suggests about the health of TPMG’s pension plan.

Understanding the Annual Funding Notice

Every April, TPMG publishes its AFN for the TPMG Plan 1 pension, as required by the Pension Benefit Guaranty Corporation (PBGC). The PBGC ensures that pension plans meet certain standards and provides insurance coverage for participants in the event of plan termination. Reviewing the AFN allows physicians to understand the financial health of the plan and its potential impact on retirement benefits.

Insights from the Most Recent AFN Report

In the last AFN (2022) sent in April 2023, TPMG’s pension plan was reported to have a funding level of 119.68%. This means that the plan had more assets than liabilities, indicating a relatively healthy financial position.

Recent Trends and Projections

Recent data from the Pension Funding Index for January 2024 provides some insights into the broader pension landscape. Despite falling interest rates, the Pension Funding Index showed a total increase in funding across the top 100 pension plans in the U.S. This increase was primarily driven by strong investment returns in 2023. Therefore, it’s reasonable to expect a small increase in pension funding for TPMG, in line with the broader market trend.

According to the Milliman Pension Funding Index, which tracks the average funding rates for the 100 largest U.S. corporate pension plans, funding rates ended 2023 at 102.1%. By comparison, the TPMG plan appears to have significantly better funding ratios than its peers.

What Physicians Should Do

  • Stay Informed: Keep an eye out for TPMG’s next funding summary, which should be available in April 2024. Review the AFN carefully to understand the funding status of the pension plan and any potential risks or uncertainties.
  • Plan Accordingly: While TPMG’s pension plan has shown healthy funding levels in the past, it’s crucial to plan for the long term. Consider diversifying your retirement savings and exploring additional retirement planning options to help ensure financial security in retirement.
  • Monitor Changes: Stay informed about any updates or changes to the pension plan and its funding status. If you have any questions or concerns, don’t hesitate to reach out to TPMG’s human resources department or plan administrator for clarification.

In conclusion

In conclusion, while recent data suggests a positive trend in pension funding–and very strong results for the TPMG plan specifically–physicians should remain vigilant about the financial health of their pension plan. By understanding the insights provided in the Annual Funding Notice and taking proactive steps to plan for retirement, physicians can help to safeguard their financial futures.

Disclaimer: Capital Advantage, Inc. is not affiliated, associated, authorized, endorsed by, or in any way officially connected with Kaiser Permanente® or TPMG (The Permanente Medical Group)

Author Profile

Ian Castille

The Author: Ian Castille

Ian is a Principal and Senior Financial Advisor at Capital Advantage, as well as a CERTIFIED FINANCIAL PLANNER™ (CFP®) and an Investment Advisor Representative. He is part of the investment committee, and is responsible for developing and maintaining client relationships, designing financial plans, and managing investment portfolios. Ian specializes in helping his clients navigate the financial transition to retirement. His work includes personalized strategies to reduce taxes, make smarter investment decisions, and optimize income streams. As an advisor, Ian believes his job is to bring peace of mind by providing financial clarity for his clients.