Normal Form of Benefit Payment
Regardless of whether you are single or married, if the total value of your
retirement benefit is $1,000 or less, you will receive a single lump-sum payment
of your retirement benefit.
If the total value of your retirement benefit is more than $1,000, you will
be able to choose from several payment options. Your benefit is automatically
paid in the normal form unless you choose otherwise.
There are two normal forms of benefit payment methods. If you are:
- Single – Refer to the Ten Year Certain and Continuous Annuity
- Married – Refer to the Standard Joint & Survivor Annuity (50% J&S)
You do, however, have the right to elect an optional form of benefit payment.
You may change your election at any time before your retirement date. Upon
your retirement date your election becomes irrevocable.
Ten Year Certain and Continuous Annuity
If you are single when benefits begin, your normal form of payment is a Ten
Year Certain and Continuous Annuity. Under this form of payment, you receive a
monthly benefit for the rest of your life, with a guarantee that at least 10
years (120 months) of payments will be made. If you die before you have received
the guaranteed number of payments, your designated beneficiary will receive the
remaining monthly payments — or may elect to receive the actuarial present value
of the remaining payments in a single lump sum.
Standard Joint and Survivor Annuity (50% J&S)
If you are married when benefits begin, your normal form of payment is a
Standard 50% Joint and Survivor Annuity for you and your spouse. Under this form
of payment, you receive monthly payments for the rest of your life. After your
death, 50% of your benefit will be paid to your spouse for his or her lifetime.
To reflect the fact that benefits are paid over two lifetimes, the Joint and
Survivor Annuity amount payable to you is less than the Ten Year Certain and
Continuous Annuity amount. Your spouse is your husband or wife to whom you were
legally married on the date Plan benefits began. Even if you are not married to
your “spouse” at the time of your death, the benefit will be payable to your
“spouse” unless your “spouse” pre-deceases you.
Initially, your benefit amount is calculated according to the benefit formula
as a Ten Year Certain and Continuous Annuity. The amount is then converted to a
Standard Joint and Survivor Annuity using actuarial factors reflecting the joint
life expectancies of both you and your spouse.
Optional Forms of Benefit Payment
You can elect an optional form of payment instead of the normal form. The
value of any optional form of benefit is the actuarial equivalent of the normal
form of benefit
If you are married and want to elect a form of payment other than the
Standard Joint and Survivor Annuity with your spouse as contingent beneficiary,
you must have your spouse’s written, notarized consent to such election.
You may revoke this election any time prior to when your benefit begins. If
your election is made less than 30 days before your retirement date, your first
month’s payment will be in the normal form. Then, the following month, your
elected form of payment will begin.
Any optional form of benefit elected by a married participant will not be
effective unless the spouse’s consent is given in writing before a notary
public.
Cashout
If the actuarial present value of your vested accrued benefit is $5,000 or
less when you terminate employment, you will be eligible to receive a cashout (a
single sum payment) as soon as administratively possible. If you receive a
cashout, no further benefits will be payable under the Plan. You may elect to
roll over the portion of your cashout that qualifies as an eligible rollover
distribution directly to an IRA or another qualified plan that accepts rollover
contributions.
- If the actuarial present value of your vested accrued benefit is $1,000
or less, you will automatically be given a cashout.
- If the actuarial present value of your vested accrued benefit is more
than $1,000 but is $5,000 or less, you may elect to receive a cashout.
Single Sum Payment
If the actuarial present value of your vested accrued benefit is greater than
$5,000 but not greater than $10,000 at the time of your retirement, you may
elect to receive a single sum payment.
The calculation of the single sum payment is based on several factors,
including the amount of the benefit you are entitled to receive, your age at
retirement, and mortality tables and interest rates prescribed by the Internal
Revenue Code and IRS regulations. These tables and rates are subject to change
from time to time.
If you receive a single sum payment, no further benefits will be payable
under the Plan. You may elect to roll over the portion of your single sum
payment that qualifies as an eligible rollover distribution directly to an IRA
or another qualified plan that accepts rollover contributions.
Single Life Annuity
You receive a monthly benefit for as long as you live. Monthly payments stop
at your death. Monthly payments under this form will be slightly higher than
those payable under the Ten Year Certain and Continuous Annuity form, because
there is no guarantee of 120 monthly payments.
Joint and Survivor Annuity
At the time you retire, you elect a percentage (up to 100%) of your
retirement benefit you wish to continue to your named survivor — who can be your
spouse, a relative or a friend. You receive an actuarially reduced monthly
benefit for your lifetime. After your death, your named survivor receives the
elected percentage of your benefit until his or her death. To reflect the fact
that benefits are paid over two lifetimes, the Joint and Survivor Annuity amount
payable to you is less than the Single Life Annuity amount.
Ten Year Certain and Continuous Annuity
You receive a monthly benefit for the rest of your life, with a guarantee
that at least 10 years (120 months) of payments will be made. If you die before
you have received the guaranteed number of payments, your designated beneficiary
will receive the remaining monthly payments — or may elect to receive the
actuarial present value of the remaining payments in a single lump sum.
You may designate primary and contingent beneficiaries. If you, your primary
and your contingent beneficiaries all die before the 120 months of payments have
been made, the remaining monthly benefits will be paid in a single sum to the
estate of the last survivor.
Level Income Option
This option is only available if you retire before age
62. It is designed to allow you to retire before age 62 (when reduced Social
Security benefits are first payable) and keep your retirement income fairly
level during retirement. When you retire before age 62, your retirement benefit
is increased by an amount estimated to be your age-62 Social Security benefit.
When you reach age 62, your benefit is decreased by this amount, whether or not
you actually begin receiving Social Security benefits. This allows your total
retirement income (Plan benefit plus Social Security) to remain approximately
level throughout your retirement.
The reduced monthly payments will continue for your lifetime. Because this
option is based on the value of the Single Life Annuity option, no benefit is
payable to a survivor upon your death.