September 2011 Vol. 14 No. 9

Let's talk benefits

Your pension plan and work after retirement

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Knowing your Pension benefit is essential for making decisions about retirement. You and your spouse should start your "pre-retirement planning" discussions well in advance of your planned retirement date—we're talking years, not months. You need to be prepared, financially and emotionally, for this big change!

Here are the different pension options available through your Northern California Carpenters Pension Trust Fund:

Service Pension: You must have a minimum of 30 Northern California Pension Eligibility Credits. This provides an unreduced monthly pension benefit at any age.*

Normal Pension: You must have 5 Pension Eligibility Credits and be at least age 65. This provides an unreduced monthly pension benefit.

Regular Pension: You must have a minimum of 10 Pension Eligibility Credits and be at least age 62. This provides an unreduced monthly pension benefit.

Early Pension: You must have a minimum of 10 Pension Eligibility Credits and be at least age 55. This provides a monthly pension benefit with a reduction of ½ of 1% for each month you are younger than age 62 (example: 42% reduction at age 55).*

Disability Pension: You must have a minimum of 10 Pension Eligibility Credits, have a Social Security Disability Award, earned at least 3/12ths Pension Eligibility Credits in the 5-year period prior to your total disability and you have no history of Non-Covered Employment since July 1991. This provides an unreduced monthly pension benefit.

*Payments may be delayed for 6 months for every calendar quarter you worked Non-Covered Employment.

If you're married at the time of retirement, there are survivor options to be considered. The survivor option provides a reduced pension benefit to you during your lifetime, but allows for a 50%, 75% or 100% benefit to be paid to your surviving spouse when you pass away. Survivor benefits not only affect pension benefits, but may affect continuing health benefits for your surviving spouse as well.

Health and Welfare benefits should be part of your overall retirement planning. You should consider whether or not you qualify for Retiree Health and Welfare AND the cost associated with the coverage. Be sure you and your spouse understand all the options before making your final choice.

The Department of Labor (DOL) has a website for "Taking the Mystery out of Retirement Planning" that includes interactive worksheets to guide you through your future projected income needs and expenses. Check it out and see where you are: http://www.dol.gov/ebsa/publications/nearretirement.html

There are many tools similar to this on the Internet or through financial programs like Quicken. If you are self-directing your annuity, there's a retirement planner on the New York Life website.

EMPLOYMENT AFTER RETIREMENT

The Prohibited Employment rules of the Pension Plan provide some post-retirement employment opportunities that will not result in the suspension of Pension benefits, including opportunities in the Building and Construction Industry. An example of Non-Prohibited Employment in Building and Construction Industry is work for a charitable organization that relies on volunteer labor to provide building services.

In general, work performed in the Building and Construction Industry in the 46 Northern California Counties by Retirees under age 55 will result in a suspension of Pension payments. However, if you are a Retiree who is at least 55 years old and younger than age 70 1/2, you may work for a Contributing Employer for up to 480 hours in a calendar year without causing a suspension of your pension benefit. The ability to work 480 hours each year without jeopardizing your Pension benefit was approved by the Trustees for a limited Special Window Period scheduled to continue through December 31, 2013.

There are other examples of jobs that are not prohibited after age 55. For instance, work for a Contributing Employer as an estimator or project manager is not Prohibited. Work as a building inspector for a public sector employer (i.e., governments, municipalities, school districts) and work in a hardware store (as long as the job is strictly a retail-oriented position) are also examples of Non-Prohibited employment.

There does come a point at which you'll "age-out" of Prohibited Employment. If you are age 70 1/2, you can work unlimited hours in the industry without suspension of your Carpenters Pension benefit.

Your pension benefit will be an integral part of your retirement income, and you will want to be sure it's protected at all times. If you're thinking of leaving the industry before retirement or working after retirement, be sure to talk with the Trust Fund to help determine if your new job will impact your future pension benefits. You don't want to encounter any unexpected surprises.

You can contact the Trust Fund Office with your Pension questions via email at benefitservices@carpenterfunds.com, via phone at (888) 547-2054, or by mail to: Carpenter Funds Administrative Office, PO Box 2380, Oakland, California 94621.

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