The Pension Benefit Guaranty Corporation, the federal agency that takes over company pensions when a plan fails, will pay a 65-year-old no more than $8,113.64 a month on a plan that fails in 2027. The figure comes from PBGC’s 2027 maximum guarantee table, last updated Oct. 19, 2026, and it applies to a straight-life annuity, which pays the retiree for life with nothing left for a survivor. Over twelve months, that ceiling comes to $97,363.68.
The ceiling matters to anyone whose pension is promised by a company that could end the plan or file for bankruptcy. A worker or retiree in that spot should compare the monthly amount on a pension statement with the PBGC figure for the age at which payments start, because only the part under the cap is guaranteed. Anyone whose pension comes from a multiemployer plan, or from a government employer, falls outside this table.
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Is $8,113.64 a monthly cap or a yearly one?
It is a monthly cap. PBGC’s tables are headed “PBGC maximum monthly guarantees for 2027,” and the straight-life figure for age 65 is one row in a table that runs from age 45 to age 75. A retiree whose plan promised more than that each month would receive $8,113.64 from PBGC and lose the difference.
Choosing a survivor benefit lowers the ceiling. The same table lists $7,302.28 a month at age 65 for a joint and 50% survivor annuity, and a footnote says that amount applies only when both spouses are the same age. PBGC’s page adds that an annuity with a larger survivor benefit generally carries a lower maximum.
The 2026 table is lower. PBGC’s tables for 2026 listed $7,789.77 a month at 65 for a straight-life annuity, so the 2027 ceiling is $323.87 higher, an increase of about 4.2%. The agency says the maximum is set by a formula in federal law tied to the Social Security index.
Which year’s table decides what a retiree gets?
The year the plan fails is what counts, not the year a retiree starts collecting. PBGC says “the relevant table is the table for the year in which your plan fails,” and if the employer was in bankruptcy, the year the employer entered bankruptcy decides. A plan that ends in 2026 is measured against the 2026 table, and a plan that ends in 2027 against the 2027 table.
Age matters too. PBGC says the age used for the lookup is generally the age at which a person first starts receiving a benefit from the agency, and the formula gives lower amounts at younger ages. In the 2027 table a straight-life benefit starting at 62 is capped at $6,409.78 a month, at 70 it is $13,468.64, and at 75 it is $24,665.47.
Starting younger than 65 cuts the ceiling sharply. At 55 the 2027 figure is $3,651.14 a month, and at 45 it is $2,028.41, according to the same table.
What does PBGC pay besides the capped monthly check?
PBGC guarantees what it calls “basic benefits” that a worker earned before the plan’s termination date or before the employer’s bankruptcy began. According to its guaranteed benefits page, those include normal retirement pensions, most early retirement benefits, survivor annuities and disability benefits, up to legal limits. The agency also generally will not pay more than the monthly benefit the plan itself would have provided at normal retirement age.
Some items are not guaranteed at all. The page lists health and welfare benefits, vacation pay and severance benefits as outside the guarantee, along with lump-sum death benefits for deaths that occur after the plan ended. Those pieces of a compensation package are lost if the plan fails, whatever the monthly ceiling is.
How can a plan participant find out whether PBGC covers the plan?
PBGC says its guarantees apply to single-employer plans that the agency has taken over, called trusteed plans. Multiemployer plans, which are negotiated by unions across several companies, fall under a separate program with its own rules and its own FAQ page.
The guaranteed benefits page points participants to PBGC’s plan search tool and to a published list of single-employer plans it has trusteed. A participant whose employer is not on that list can ask the plan administrator whether the plan is a single-employer plan, and which age the plan treats as normal retirement age. The administrator’s answer, set against the table at the age payments begin, shows how much of a promised pension sits above the cap.
Is the pension on your statement bigger than the ceiling for your age?
A pension that sits above the PBGC ceiling is one way retirement income comes up short, and it is one of several. Taxes on withdrawals, Medicare surcharges, house costs and savings that earn nothing each take a share of a fixed income, and none of them waits for a plan to fail.
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This article was produced with AI assistance and edited for accuracy against the sources linked above.
David M. Keller is a finance writer based in Columbus, Ohio, covering personal finance and consumer-focused economic topics. He earned his degree in journalism from Ohio University and began his career reporting on local business and economic trends for a regional media outlet. Since then, he has contributed to a variety of online publications, focusing on clear, practical coverage of topics such as cost of living, debt, and everyday financial decision-making.
