I am age 40 and a participant in a defined benefit pension plan. I have been told that the amount of my pension will be reduced due to 415 limitations. My plan has no age penalties built-in and is a "20 and out plan" that provides retirement benefits to retirees after 20 years. It is also not a government plan, I work for a private company. Here are a few questions:
- How is the calculation performed to determine the maximum annual benefit I can recieve? I believe the 2006 amount is 5,000 at age 65, but how do you calculate the amount someone 40 can recieve?
- What happens in the years following retirement? Is the limit recalculated each year or is your amount fixed at the amount calculated when you retire?
- Is there a resource available that is written so the average person can understand how EGTRRA has impacted defined benefit pension plans?
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