david rigby

Data as of 02/28/2019 (Thursday) Moody's Daily Long-term Corporate Bond Yield Averages Utilities Industrial Corporate Aaa NA 3.86 3.86 Aa 4.11 3.99 4.05 A 4.27 4.29 4.28 Baa 4.76 5.14 4.95 Avg 4.38 4.32 4.35 Moody's Daily Treasury Yield Averages Short-Term (3-5 yrs) 2.52 Medium-Term (5-10 yrs) 2.65 Long-Term (10+ yrs) 3.01 Observation: comparing the Avg line to 12 months prior, the rates are about 20 points higher. Comparing the Avg line to 6 months prior, the rates are about 6 points higher.

Be careful about "last day in the office". Many examples of employees with a few days of accrued leave/vacation, and retirement/severance is after those days are used up. Most of our clients specify "last day worked" and "last day paid".

As you state, the plan permits a contribution; the contract says no. Sounds to me like the contract takes precedent over a possible management decision to make a contribution. The contract has no bearing on the plan. Do I have the facts correct?

If the ER ceased to exist, would that automatically create a plan termination and a PYE?

It seems obvious (to me) that a plan sponsored by NYC is not ERISA-qualified. As QDROphile states, "government plans live... by their own rules", sometimes influenced by state-mandated standards, but not by federal-mandated standards. IMHO, the first thing to do is check the provisions of the elected form of payment. It may provide a "joint-and-survivor" payment that pays a portion to the surviving spouse (and this may or may not apply to a divorced spouse). Alternatively, the payment form may provide a different form of survivor payment, or none. You (surviving child) can probably check this before engaging any legal counsel.

Well, thanks for the clarification.

At the risk of stating the obvious, this might be a good time to review the plan provisions that describe TH benefits, esp w/r/t multiple plans. While it (theoretically) should not be necessary, we have seen examples of inadequate plan drafting.

Are you sure there is no actuarial increase?

Well..... almost never. Perry did lose a few cases.

Just curious, is IRS Reg. 1.415(a)-1(f)(7) is relevant?

Never say never.

Please consider that the "take rate" may be related to many factors, and "sweetness of the pot" is only one of them. Best way to begin is to talk to a pension actuary who has experience with ER windows. There are many ways to tweak the plan design to improve success rate, and your actuary can help with that, likely with confirmation from the legal counsel. Example1, there may be things outside the pension plan that can be modified without significant increase in cost. (I've seen a few different examples of this, some of which may require the company to engage another expert, such as accountant or attorney for compliance analysis.) Example2, the demographic characteristics of the current target group may be different from the target group on the prior window, so it may not be valid to assume the prior take rate will be applicable this time. Example3 (contact your actuary).

Data as of 01/31/2019 (Thursday) Moody's Daily Long-term Corporate Bond Yield Averages Utilities Industrial Corporate Aaa NA 3.79 3.79 Aa 4.09 3.94 4.02 A 4.27 4.21 4.24 Baa 4.82 5.19 5.01 Avg 4.39 4.28 4.34 Moody's Daily Treasury Yield Averages Short-Term (3-5 yrs) 2.45 Medium-Term (5-10 yrs) 2.56 Long-Term (10+ yrs) 2.91

As implied above, if you are referring to qualified plans, a 401(k) plan IS a 401(a) plan and a DB plan IS a 401(a) plan.

Just suggesting that this ONE error may not be the only error. If there are others, the source of that problem should be addressed.

Smoke? Fire? Has it been determined that this problem is/is not isolated? One error could mean other errors. Just sayin'.

Several times, I've changed my salary assumption. (Example1, 2009 recession. Example2, immediately following a very good year in which sales commissions were unusually large and not expected to recur.) It may also be valid to have different assumptions for different groups/locations/etc.

The original Q was about assumptions. If you need to change your salary increase assumption, do it. Keep a record of why and what data is used for your conclusion. IMHO, you should also include reasonable (not necessarily detailed) discussion in your actuarial report. Don't forget the 5500 attachment.

Pardon my ignorance, can you provide more information?

Caution. The original Q might mean a plan adopted by one member of a controlled group but not by other members. If one or more other members has a qualified plan, it's possible the non-discrimination testing is passed only in the aggregate. Thus, terminating one plan might affect the other plan(s).

Perhaps it is prudent to view this as a consulting opportunity: make sure you understand the context ("why do you want a periodic distribution?") before recommending yes or no to the amendment question.

I have some widgets for sale. Price negotiable.

Be careful. Was it in the contract, but never enforced? (That's not the same as not being in the loan contract at all.)

Huh? Are you saying the QDRO has been finalized and the amount paid/transferred to the AP? If so, the participant's next statement will show the amount leaving his account.

I've answered this question for several retirees in the past, several different plans. While it may be possible for a plan provision to permit a retiree in pay status to cease or suspend payments, I've never seen a plan that does so. Also, it seems unlikely the plan administrator (and/or plan sponsor) would want such a provision.