Defined Benefit Pension Summary Plan Description

10. What pension payment options do I have if I am married?

For purposes of all benefits under this Plan, Spouse means a person to whom a Participant is legally married.

Article 5 of the Plan Document describes the benefit options below in more detail.

When you apply for retirement, the Administrative Office will give you the amounts payable under each applicable benefit form. If you are married, your Spouse must consent to your election in writing. The consent must be witnessed by a notary public.

Joint and Survivor Forms of Benefit

There are four "Joint and Survivor" forms of benefit:

  • Joint and 50% Survivor Form;
  • Joint and 66-2/3% Survivor Form;
  • Joint and 75% Survivor Form; and
  • Joint and 100% Survivor Form.

When you select a Joint and Survivor form of benefit, the amount of benefit you would have received under the Normal Form (see Question 9 on page 18) is adjusted so that benefits payable under the Joint and Survivor form are equivalent to the benefit that would have been payable in the Normal Form. The adjustment is based on actuarial factors determined by your age and your Spouse's age at the time of retirement.

The reduction for the Joint and Survivor Forms are generally between 9% and 20%. You will receive the reduced benefit for your lifetime (unless you elect one of the "pop-up" options and your Spouse dies before you).

If you die before your Spouse, your Spouse will receive a certain percentage of your benefit amount for life, depending on what form of benefit you select at retirement. This benefit can only be paid to the Spouse you are married to on your original retirement date.

If your Spouse dies before you, then the benefit stops with your death, unless there are additional guaranteed monthly payments, which would be payable to your surviving designated Beneficiary.

Joint and 50% Survivor Form

If you are married, your pension will be paid in the Joint and 50% Survivor Form, unless you and your spouse elect an optional form of pension. Your Spouse must agree to the optional form and provide a written and notarized consent to the election.

For example:

At retirement, Bob Smith's monthly Normal Form Pension is $2,400. He and his wife select the Joint & 50% Survivor Form. Based on their respective ages, he would receive $2,000 per month. If he dies before his wife, she would then receive $1,000 per month for her lifetime. If she dies first, Bob's pension would stay at $2,000 per month.

Joint and 50% Survivor Form with "Pop-Up"

The Plan also offers a "pop-up" option that can be elected at time of retirement. Under this "pop-up" option, if your Spouse dies before you, your benefit will revert to the Normal Form Pension. Under this option, the benefits payable while you are married and after your death to your surviving Spouse are about 1-2% lower than the standard Joint and 50% Survivor Form.

Benefits calculated under the Default Schedule are not eligible for the "pop-up" option.

For example:

At retirement, Bob Smith's monthly Normal Form Pension is $2,400. He and his wife select the Joint and 50% Survivor Form with Pop-Up. Based on their respective ages, he would receive $1,960 per month. If he dies before his wife, she would then receive $980 per month. If she dies first, Bob's pension would "pop up" to his Normal Form Pension amount of $2,400, beginning with the month following her death.

Additional Joint and Survivor Forms of Benefit

The Joint and 66-2/3% Survivor Form, Joint and 75% Survivor Form and Joint and 100% Survivor Form are similar to the Joint and 50% Survivor Form.

In each case, the difference is the amount of benefit payable to the Spouse upon the death of the Participant. The higher the percentage that is payable to the Spouse upon the death of the Participant, the lower the initial pension amount payable.

Benefits calculated under the Default Schedule are only eligible for the Joint and 50% Survivor option or the Joint and 75% Survivor option. They are not eligible for the Joint and 66-2/3% Survivor option or the Joint and 100% Survivor option.

For example:

At retirement, Bob Smith's monthly Normal Form Pension is $2,400. He and his wife select the Joint & 100% Survivor Form. Based on their respective ages, he would receive $1,800 per month. If he dies before his wife, she would then receive $1,800 per month. If she dies first, Bob's pension would stay at $1,800 per month.

The "pop-up" option is also available for the Joint and 66-2/3% Survivor Form, Joint and 75% Survivor Form and Joint and 100% Survivor Form for most Participants, but only under the Alternative Schedule of benefits. Benefits calculated under the Default Schedule are not eligible for the "pop-up" option.

Sample Joint and Survivor Form Factors

Sample Joint and Survivor form factors for benefits earned under the Alternative Schedule are shown in the following tables. The percentages listed show the percentage of the Normal Form that would be payable under each of the payment options, given the retirement ages of the Participant and Spouse.

Table 1: Participant and Spouse are the Same Age
(% of Benefit Payable to Participant)

  50 55 60 62 65
Joint and 50% Survivor Form 92.3% 91.5% 90.8% 90.6% 90.6%
Joint and 66-2/3% Survivor Form 89.8% 88.7% 87.7% 87.4% 87.1%
Joint and 75% Survivor Form 88.7% 87.4% 86.3% 85.9% 85.5%
Joint and 100% Survivor Form 85.3% 83.7% 82.2% 81.6% 81.0%
Joint and 50% Survivor Form w/ Pop-Up 90.8% 89.5% 88.4% 88.0% 87.6%
Joint and 66-2/3% Survivor Form w/ Pop-Up 87.9% 86.3% 84.6% 84.0% 83.3%
Joint and 75% Survivor Form w/ Pop-Up 86.6% 84.7% 82.9% 82.2% 81.3%
Joint and 100% Survivor Form w/ Pop-Up 82.7% 80.4% 78.0% 77.1% 75.9%

Table 2: Participant is 3 Years Older Than Spouse
(% of Benefit Payable to Participant)

  50 55 60 62 65
Joint and 50% Survivor Form 90.9% 89.8% 88.8% 88.4% 88.0%
Joint and 66-2/3% Survivor Form 88.1% 86.6% 85.2% 84.7% 84.0%
Joint and 75% Survivor Form 86.7% 85.1% 83.6% 82.9% 82.2%
Joint and 100% Survivor Form 83.0% 80.9% 78.9% 78.1% 77.0%
Joint and 50% Survivor Form w/ Pop-Up 89.5% 88.0% 86.5% 85.9% 85.3%
Joint and 66-2/3% Survivor Form w/ Pop-Up 86.4% 84.4% 82.4% 81.6% 80.6%
Joint and 75% Survivor Form w/ Pop-Up 84.9% 82.7% 80.5% 79.6% 78.4%
Joint and 100% Survivor Form w/ Pop-Up 80.7% 78.0% 75.2% 74.1% 72.5%

Table 3: If Participant is 3 Years Younger Than Spouse
(% of Benefit Payable to Participant)

  50 55 60 62 65
Joint and 50% Survivor Form 93.6% 93.1% 92.7% 92.7% 92.9%
Joint and 66-2/3% Survivor Form 91.5% 90.7% 90.2% 90.0% 90.0%
Joint and 75% Survivor Form 90.5% 89.6% 88.9% 88.7% 88.6%
Joint and 100% Survivor Form 87.6% 86.4% 85.4% 85.1% 84.7%
Joint and 50% Survivor Form w/ Pop-Up 92.0% 91.0% 90.2% 90.0% 89.9%
Joint and 66-2/3% Survivor Form w/ Pop-Up 89.4% 88.1% 86.8% 86.4% 86.0%
Joint and 75% Survivor Form w/ Pop-Up 88.2% 86.7% 85.3% 84.8% 84.2%
Joint and 100% Survivor Form w/ Pop-Up 84.7% 82.7% 80.8% 80.1% 79.2%

Sample Joint and Survivor form factors for benefits earned under the Default Schedule are shown in the tables below. Note that only the Joint and 50% Survivor and Joint and 75% Survivor forms are available for these benefits:

Table 4: Default Schedule - If Participant and Spouse are the Same Age
(% of Benefit Payable to Participant)

  50 55 60 62 65
Joint and 50% Survivor Form 91.8% 90.7% 89.5% 89.0% 88.2%
Joint and 75% Survivor Form 88.3% 86.7% 85.1% 84.4% 83.3%

Table 5: Default Schedule - If Participant is 3 Years Older Than Spouse
(% of Benefit Payable to Participant)

  50 55 60 62 65
Joint and 50% Survivor Form 90.5% 89.1% 87.5% 86.8% 85.7%
Joint and 75% Survivor Form 86.3% 84.4% 82.4% 81.5% 80.0%

Table 6: Default Schedule - If Participant is 3 Years Younger Than Spouse
(% of Benefit Payable to Participant)

  50 55 60 62 65
Joint and 50% Survivor Form 93.2% 92.3% 91.4% 91.0% 90.4%
Joint and 75% Survivor Form 90.1% 88.9% 87.7% 87.1% 86.3%

Normal Form

A married participant may also elect to receive the Normal Form of benefit, which features a single monthly payment made for the life of the Participant.

For benefits payable under an Alternative Schedule, there is a 60-month guarantee on the Normal Form of benefit. If you die before 60 months have been paid, the balance of the 60 months will be paid to your designated Beneficiary.

Benefits payable under the Default Schedule are not eligible for the 60-month guarantee.