Pension Top FAQ’s

HOW LONG DO I HAVE TO WAIT TO BECOME A PARTICIPANT OF THE UFCW CONSOLIDATED PENSION FUND?
If you are an Employee of an Employer who has been approved by the Board of Trustees that has agreed to make contributions to the Consolidated Pension Fund on your behalf and you have reached the age of twenty-one (21), you will become a Participant on the first day of the month following the month in which you earn  (1) year of Eligibility Service.

WHAT IS THE DIFFERENCE BETWEEN ELIGIBILTY SERVICE AND CREDITED SERVICE?
Eligibility Service is used to determine whether you qualify for Plan benefits. Generally, you receive a Year of Eligibility Service and Credited Service for each calendar year in which you have 400 or more hours of service. Past Credited Service is service for employment prior to the date your employer joined the Plan. See the summary plan description for details. Credited Service is used to calculate the amount of your benefit from the Plan. Future Credited Service is based only on the hours which contributions are made for you during each calendar year.

WHEN AM I VESTED?
Becoming vested is based on your Eligibility Service. You earn one (1) year of Eligibility Service for each calendar year in which you have at least 400 hours of service, including service not covered by the collective bargaining agreement. To become vested in the UFCW Consolidated Pension Fund, you must earn at least five (5) years of vesting with a participating Employer. Once a Participant has earned at least five (5) vested years, then you are eligible for a retirement benefit at your Normal Retirement Date.

WHO PAYS FOR MY BENEFITS?
Defined benefit plans are paid for or funded in full by employers. Plans must be funded ahead of time with contributions placed in a trust.

CAN I BORROW FROM MY PLAN?
No. This plan does not allow for borrowing.

HOW IS MY BENEFIT CALCULATED?
Benefits are determined based on the benefit rate in effect at the time of your termination of coverage under the Plan. See the Summary Plan Description for details. 

WHAT IS A REQUIRED DISTRIBUTION OF BENEFITS?
Once a participant reaches the age of 70-1/2 and has five (5) or more years of eligibility service, there is a required distribution of benefits. On April the calendar year of the following the age of 70-1/2, a Participant is required to begin their Pension Benefits. You may continue your employment and there is no restriction on the number of hours you may work. If your employment continues with a Participating Employer and you earn any additional Credited Service, your benefit will be recalculated as of December 31 of each year and adjusted accordingly. There are also requirements with respect to the form and timing of death benefits.

HOW MANY YEARS DO I NEED TO BE ELIGIBLE FOR A BENEFIT?

  • NORMAL: 5 or more years of Eligibility Service and age 65.
  • EARLY: 10 or more years of Eligibility Service and age 65.
  • DISABILITY: 20 years of Eligibility Service is required with Social Security Disability Award.

HOW LONG WILL IT TAKE TO PROCESS MY APPLICATION?
Please apply at least four (4) months in advance of your retirement date as this is the approximate amount of time required to complete the application. If you are on an authorized sick leave due to a serious illness or injury, which could result in total and permanent disability, you should apply for benefits as soon as possible.

HOW WILL I KNOW WHEN I WILL BEGIN PAYMENTS?
You will receive a benefit election packet. This packet will include one or more benefit options. Unless otherwise stated, you may make one choice. The tax form and direct deposit form will be included in the packet.

WHEN WILL THE PAYMENT GO INTO MY ACCOUNT?
The money goes in your account on the first business day of the month if you have Direct Deposit. If the first day falls on the weekend or a holiday, it will be in your account on the following business day. If your account is closed or if you have provided incorrect bank information, the bank will reject the deposit and will notify us. Since automatic deposits can only be made once a month, a check will be mailed to you immediately after the bank returns the money. We will continue mailing your check until we receive a Direct Deposit Authorization form with the correct information.

DO YOU SEND A CHECK STUB IF THE BENEFIT IS DIRECT DEPOSITED?
No. The deposit will appear on your bank statement.

DO YOU WITHHOLD INCOME TAX?
We withhold Federal Income Tax. We do not withhold for state income tax. A W4P tax form will be provided before you go on the Pension payroll. You may wish to make estimated state tax payments to avoid penalties. 

WHAT IS THE LEVEL INCOME OPTION?
This benefit option is offered if you are under the age of 62 at retirement. The monthly benefit that you will receive from this Fund until you reach the age of 62 will be higher than that of the early single life option but it will drop at the age of 62 to a lower amount than the early single life option. This benefit cannot be estimated until we have your yearly earnings to calculate the amounts.