Explore commonly used personal finance terms.
Accumulated funding deficiency refers to a pension plan’s shortfall in meeting minimum funding requirements. This deficiency indicates that the plan does not have enough assets to cover future liabilities, potentially jeopardizing retiree benefits. Accumulated funding deficiencies are addressed through regulatory measures, which may require the plan sponsor to increase contributions. Monitoring funding status is crucial for pension stability, as deficiencies affect the plan’s ability to deliver promised benefits and can lead to legal penalties.
