RS Plan: Timing for Requesting Year-end Benefit Estimates
As we move into the Fall of 2021, many cooperative employees who are eligible for full or quasi-retirement will be requesting benefit estimates from the Retirement Security (RS) Plan. To ensure timely and accurate completion of these requests, please be aware of the following timing.
Benefits administrators should run 2021 estimates—and, for participants who want to compare results for more than one retirement date, 2022 estimates using assumed rates—on the Employee Benefits website as early as possible but no later than Friday, October 29, 2021. If the online estimate tool indicates that a special (manual) calculation is necessary, requests for 2021 and 2022 estimates should be submitted using the “special request” link on or before October 29, 2021. Please provide any special handling instructions in the comment section of the special request.
Currently, for 2022 benefit estimates, the RS Plan assumes conservative interest rates in converting a participant’s life-only annuity into a lump sum distribution. As a result, many 2022 estimates requested before mid-December will produce a much lower lump sum than one requested for any date in 2021. If participants would like a more accurate 2022 lump sum estimate, enter “hold for rates” in the online estimate tool’s “special request” link. The estimates will be sent to you after December 15, 2021, when the actual 2022 interest rates used to calculate RS Plan lump sum benefits — the 30-year Treasury rate, also known as the General Agreement on Tariffs and Trade (GATT) rate, and a three-segment rate created in the Pension Protection Act of 2006 — are released. Benefits administrators will be notified when they can begin to run 2022 estimates and 2022 special requests for manual calculations using the new interest rates after NRECA systems are updated.
All special requests for manual calculations submitted by October 29 will be delivered to the person requesting them as they are completed, on or before December 28, 2021.
Except for participants with a birthday in January or February 2022, manual calculation requests for both 2021 and 2022 will be limited to two calculations. To better understand how their change in age affects their benefits, participants with January or February birthdays can request two calculations — one for just before their birthdate and one for just after their birthdate. Estimate requests for 2021 and 2022 will have priority over other future retirement or quasi-retirement estimates beyond 2022.
Resources for your employees
To help you with employee discussions, NRECA has developed two resources:
- A sample email template that you can use with retirement-eligible employees;
- A flier, Answers You Need: Weighing Your RS Plan Payment Options, which can help participants evaluate their RS Plan benefit options.
RS Plan participants also have access to the Personal Investment & Retirement Consulting (PIRC) team. A PIRC team member can provide personalized education to co-op employees and can be reached via email at pirc@nreca.coop or by phone at 866.673.2299, option 6.
Questions?
We are here to help you. Please contact your field representative for specific questions or concerns. Representatives in NRECA’s Member Contact Center are available Monday through Friday, 7 am – 7 pm, Central time at 866.673.2299 or via email at contactcenter@nreca.coop.