Page 83 - Pay'n Save Retirement Truat fund

81 | SOUND RETIREMENT

Example 2: Retirement From Active Employment on or After Age 55
As of July 1, 2010, Karen is an Active participant in the Meat Plan at age 57 and
has 20 years of credited service with a monthly accumulated benefit of $1,500
per month. Karen continues full time work and earns a monthly benefit of $80
for her 4 additional years of service earned during July 1, 2010 through June
30, 2014 and $25 for her hours during July 1, 2014 through September 30,
2015. During the period July 1, 2014 through September 30, 2014, Karen works
400 hours; during each of periods July 1, 2014 through June 30, 2015 and
October 1, 2014 through September 30, 2015 she works more than 1,000 hours
in covered service. Karen asks if she is eligible for the Rule of 85 Wear Away
Plan early retirement benefit and if so, what would her benefit be if she retires
as of October 1, 2015?
On October 1, 2015, Karen is age 62 and has 25 years of credited service from
the Meat and Sound plans (20 years as of June 30, 2010, 4 years during July
1, 2010 through June 30, 2014 and 1 year for having 1,000 or more covered
hours during the periods July 1, 2014 through June 30, 2015 and October 1,
2014 through September 30, 2015). Because her age plus service is 87 as of
October 1, 2015 and she was Active when benefits were changed effective July
1, 2010, and remained active through her retirement, she is eligible for Rule of
85 benefit under the Meat Plan.
Karen’s early retirement pension on October 1, 2015 is the sum of the early
retirement benefit she earned under the Meat Plan prior to July 1, 2014 and
the amount of the benefit she earned after that date. The early retirement
benefit from the Meat Plan is the greater of the regular Meat Plan benefit she
earned for service as of June 30, 2010 ($1,500 per month) and the total Meat
Plan benefit she earned as of June 30, 2014 of $1,580 per month multiplied by
the early retirement reduction factor as a Standard Reduced Meat Plan early
retirement pension (0.717) or $1,156.36 per month. The benefit earned on or
after July 1, 2014 for service under the Sound Plan is $23.50 per month ($25
earned multiplied by the Sound Plan early retirement reduction factor for a
Standard Reduced early retirement pension of 0.94).
On October 1, 2015, Karen will receive a pension benefit of $1,523.50 per
month (=$1,500 + $23.50), payable as a single life annuity. This amount would
then be adjusted if she selects a different form of payment.