You may opt to take a second retirement once you reach age 65, or at any time after 65 (up to the federally required minimum distribution age of 70½ when you must begin taking your pension even if you elect not to retire). You are entitled to receive a second retirement benefit if you have earned money for covered writing services at any time after your first retirement.
If you continue to work after opting for your second retirement, your second retirement benefits will rise commensurate with your income from those covered writing services.
By way of example, if you took an early retirement and were receiving $2,000 a month, but earned an additional $100,000 by the time you were 65, your second retirement check would be calculated as follows: Your employer(s) would contribute based on the bargaining agreement and $6,000, of which you would receive 48.3% annually ($2,898) which would then be apportioned over 12 months so that your second retirement check would be $241.50 each month. If, after this, you got hired to perform covered writing services post your second retirement, for example let’s say you were paid $100,000 for a rewrite, your second retirement check would increase to $483 per month.
If you decide not to take your 2nd retirement, for each month you delay the amount of your benefit will increased by the greater of (1) an increase by .8% of the previous year’s benefit and (2) the benefit you accrued from contributions. Thus, in this example, if the Participant were to delay taking their 2nd retirement for 24 months, they would receive an additional $46 per month.
| Early Retirement Pension Amount | 2nd Retirement After Earning $100,000 Post Early Retirement | 2nd Retirement Amount After Earning Additional $100,000 For Rewrite | 2nd Retirement Amount After a 24 Month Delay In Filing For 2nd Retirement Benefits |
|---|---|---|---|
| $2,000 per month | $241.50 per month | $483 per month | $529 per month |
There are Federal rules which govern the maximum amount a Participant may receive; this amount varies, dependent upon how early a Participant takes their early retirement.
If you are within 90 days of your 2nd retirement date, you should contact the PWGA’s Pension Department to arrange an appointment to discuss your options. We will be happy to prepare a number of estimates for you to consider. You are welcome to bring an authorized financial representative to assist you with arriving at the best outcome for you and your family.
DEFERRAL While you can take your benefit as soon as you reach your earliest possible Second Retirement date you may elect to begin your 2nd pension at a later date of your choosing, up to the federally required minimum distribution age of 70½ when you must begin receiving pension disbursements whether or not you are retired (generally, April 1st following the year in which you reach 70½). Your post-65 Second Retirement Benefit will be increased to include the additional contributions, or an actuarial adjustment, whichever pays more. The actuarial adjustment is .8% for each month you delay for the first 59 months after 65, and 1.2% per month thereafter.
In addition, a Participant has retirement options such as: Five-Year Certain & Life Annuity, Joint and 50% Survivor Annuity, and a host of other possibilities.
ADVANTAGES TO WAITING TO TAKE YOUR SECOND PENSION In addition to a larger benefit amount, there may be other reasons a Participant might want to delay receiving a 2nd pension. The PWGA Pension Department will be happy to assist you in explaining your Plan options.
TAX CONSIDERATIONS Because the 2nd retirement means you will be receiving additional monies, it may be necessary to adjust your withholding amounts. Even though you will receive two payments once you opt to receive your 2nd retirement benefits, there is not a separate withholding for each check; the withholding is based on the aggregate amount of the benefit checks.
WHAT’S IN THE PACKET YOU WILL RECEIVE WHEN YOU ARE CLOSE TO TURNING 65 As you approach your 65th birthday, you should request a 2nd Retirement package from the PWGA. Inside this package you will find:
APPOINTMENT NOTICE – This document is written in big type because we think it is extremely important that we get a chance to explain your options. If you are married, your spouse should accompany you. You are also welcome to invite (or send alone, if you prefer) an authorized financial representative. (Please note: financial representatives cannot sign documents on your behalf.)
SECOND RETIREMENT BENEFIT APPLICATION – This sets forth the options available to you given your earnings history if you retired early and are now eligible for a second retirement.
2ND RETIREMENT TAX CONSIDERATIONS MEMO – This document sets forth some of the tax implications you may want to consider when you start receiving a second retirement check and your income is larger than it was previously.
STATE TAX WITHHOLDING FORM – This is the document you use to adjust your withholding for state taxes, if necessary.
FEDERAL TAX WITHHOLDING FORM – This is the document you use to adjust your withholding for federal taxes, if necessary.
RETURN ENVELOPE MARKED “URGENT” – The return envelope is marked “urgent” so that we will be on the lookout for it, and act as quickly as possible to process your pension application.
MAKE AN APPOINTMENT TO FIGURE OUT WHAT’S BEST FOR YOU There are many options to consider before you take your 2nd retirement. The PWGA is happy to arrange a time for you (or your authorized financial representative) to come to the PWGA offices so we can discuss your options. Parking is free!