How The Level Income Option Works
The
pension you receive from this Plan is in addition to any other retirement
benefits – Social Security or National Electrical Benefit Fund (NEBF)
benefits – you are eligible to receive. The earliest you can receive
reduced Social Security benefits is age 62 or full Social Security benefits
at age 65 or later, based on your date of birth. The earliest you can
receive your NEBF benefits is age 60. If you retire before your Social
Security or NEBF benefits begin, you may have a gap, or reduction, in your
income until you begin receiving Social Security or NEBF benefits.
Benefits Before Age 62 Or 65
Under
the Level Income Option, your Regular, Normal Retirement Age or Early
Retirement Pension from the IBEW 701 Plan would be increased by either 20%
or 40% (based on your election) until you reach age 62 or 65 (based on
your election). This reduces the gap in your monthly income until your
Social Security or NEBF benefits begin. If you elect the Lump Sum
Readjustment Allowance, which allows you to take a portion of your benefits
as lump sum, the Level Income Option is figured after the lump sum
adjustment.
Benefits After Age 62 Or 65
Once
you reach age 62 or 65 (the age you elected), your pension from the IBEW 701
Plan will decrease because you received a larger pension (the 20% or 40%
increase) before that date. However, your lower IBEW 701 pension benefit
when combined with your Social Security and NEBF benefits will provide you
with a more level total retirement income throughout your retirement.
Level Income Option Requirements
Eligibility
To
be eligible to elect the Level Income Option, you must:
If
the Level Income Option adjustment reduces your monthly pension amount after
you reach age 62 or 65 to less than $100 per month, you are not eligible to
elect this option. After your Level Income Option election is chosen and the
first payment made, it cannot be changed.
If You Are Married
If
you are married when you retire, your spouse must consent to the Level
Income Option election in writing. If you elect to receive your pension as a
50% Husband-and-Wife Pension with the Level Income Option and:
-
You die before your
spouse, your spouse will receive a lifetime monthly benefit equal to 50%
of your original pension reduced for the 50% Husband-and-Wife form of
payment, without the level income option adjustment; or
- Your
spouse dies before you, your
monthly benefit will be increased or “pop-up” to the amount you
would have received had your pension been adjusted for the Level Income
Option only without the 50% Husband-and-Wife Pension adjustment.
Returning To Covered Employment
After
you retire, your pension may be suspended if you work in certain types of
employment, based on your age. If you elect the Level Income Option, your
monthly pension will be suspended if you:
n
Are under age 60
and work:
¾
One or more hours in an occupation covered by the collective
bargaining agreement; or
¾
40 or more hours per month in the electrical industry, at a
trade or craft that you were working in at any time you were covered under
the Plan including employment with NECA, the IBEW or any of their mutual
funds (excluding work as an electrical inspector for a governmental
authority).
n
Are
between ages 60 and 65 and work
40 or more hours in a month:
¾
In an occupation covered by the collective bargaining
agreement; or
¾
In the electrical industry, at a trade or craft that you were
working in at any time you were covered under the Plan including employment
with NECA, the IBEW or any of their mutual funds (excluding work as an
electrical inspector for a governmental authority).
n
age 65 or over and work 40
or more hours per month in an occupation covered by the collective
bargaining agreement.
If
you retire and return to covered employment and retire again before age 65,
you cannot elect the Level Income Option for the additional pension credits
earned after your original retirement (regardless of your original pension
payment option).
If
you elect the Level Income Option and your pension is suspended before your
pension is scheduled to be reduced (at age 62 or 65), your reduced pension
will be adjusted to reflect that you did not receive your full pension
amount for the months your pension was suspended.
Level
Income Option Example
Assume
Jason retires at age 58 and is married. After his pension is reduced for
early retirement, the Lump Sum Readjustment Allowance and 50%
Husband-and-Wife Pension, his IBEW 701 pension is $2,000 a month. At age 62,
his Social Security benefit is estimated to be $1,500. Jason is also
eligible to receive a NEBF benefit of $1,000 per month at age 62. If he
elects the Level Income Option with a 40% increase, he would receive an
additional $901 per month or $2,901 ($2,000 + $901) from the IBEW 701 Plan
until age 62. At age 62, his IBEW 701 pension would be reduced to $1,650 a
month.
|
Level
Income Option With 40% Increase
|
|
Benefit
|
Jason’s
Monthly Benefits Before Age 62
|
Jason’s
Monthly Benefits After Age 62
|
|
Jason’s
IBEW 701 40% Level Income Option
Pension Benefit
|
$2,901
|
$1,650
|
|
Jason’s
Social Security Benefit
|
$0
|
$1,500
|
|
Jason’s
NEBF Benefit
|
$0
|
$1,000
|
|
Total
Monthly Benefit
|
$2,901
|
$4,150
|
