[Eclectic12]

My SO is one of the few people, these days, to have a DB Pension Plan.

As a part of this pension plan they also have Flex Options that they can contribute to, which include things such as: Early Retirement Pension, Bridge Benefits, Survivor Benefits and more. Participants are able to contribute to their Flex Options any time and can choose the amount they contribute. However, it's not clear on how much "should" be contributed for each of the options (or costs of each option) and if there is excess amount in the Flex account you can lose the money.

Anyone else have a similar type plan? Would appreciate any thoughts or inputs on how much we might be able to contribute without worry about losing this in the long run?

Yes ... at my company one can book a session with the benefits person to go over what one wants to achieve, review where one is at and project what one thinks one needs.

There's also a web based calculator that is updated yearly. Part of the calculator is a flex pension part that allows one to adjust the pension by what flex option is chosen. It also reports the current estimated cost as well as what the employee currently has in their account.

... never heard of such a plan as likely newly engineered ...

It's been around a long time for executives. The surprise when I joined the company was that regular staff also had the option to use it.


Cheers

 

[Eclectic12]

"Regular" = full time, permanent employee (i.e. includes the mailroom clerk, receptionist).
"Executive" = small group of the total number of full time, permanent employees (i.e. not the mailroom clerk, receptionist).

The surprise is that at my current company - the flex pension is available to all full time employees. All previous flex pension plans I had read of/heard of were for executives only.


Cheers

 

[Eclectic12]

So if I am reading this correctly, the flex plan was available to all employees who were in the DB plan, correct?

If so, this matches my current plan.
As I say, for previous companies - I as a lower than executive employee did not have access to the flex plan as it was for the executive level employee.


Can you explain what you mean by the "flex plan was carried out for those in the supplementary (earning above the legislated limits)" bit?

For my current plan, for those earning above the legislated limits there is a separate supplemental pension. I don't believe the flex plan applies to the supplemental but I glossed over those details when I read the pension booklet.

In the regular pension, the flex plan is available to all employees.


Cheers

 

[Eclectic12]

Our flex plan was applied to pensionable earnings above the stat. limit by use of a 'notional' account.

Interesting ... I wonder if the "executive only" flex plans work this way as well. No one shared the details to this level so I don't know.

Our flex plan OTOH has people making $40K signing up and participating. There's a set menu of what they can buy with the $$$ as well as the choice of what it is invested in. There's no company matching funds.

... When I retired, this notional account was was given to me in the form of a lira. It could not be used to buy enhancements to the DB plan.

Weird ... our plan has whatever dollars the funds grew to, which then buy pension enhancements. If one ends up with too much, the DB pension profits. If one ends up with too little for the range of enhancements one wants to buy then one has some choices to make.

There's no LIRA ... just whatever enhancement one buys and whatever profit the DB pension makes.

... The only flex monies that I could use to enhance the DB plan were my contributions and the company match up to to, but not exceeding, the stat. Gov't cap.

Now I am confused ... there was a notional account that resulted in a LIRA and another that bought enhancements?

... Many of the supplemental plans are different when it comes to earnings above the gov't max ...

Maybe that's the key difference ... our flex plan allows one to contribute or transfer other payments such as overtime up to the gov't max but no more. That may explain why it can only buy pension enhancements.


Cheers

 

[Eclectic12]

Interesting that for your executive version there's a $103K split that can't be used to enhance benefits but will provide retirement $$$ from the LIRA.

It is sounding like the employer $$ is what is causing the difference ... though under $103K amounts, the employer money is fine for enhancing the pension.


When I get a chance, I'll re-read our plan but as I say ... there's a set menu, set amounts for the max per year but no references that I recall to income levels.

Cheers