How do I know how my pension plan operates and what my pension rights are?

When you have an employer that offers a pension plan, whether you contribute to the pension plan from your earnings or not you should know how it operates. In fact, your employer or pension plan administrator is required to give you a booklet, called a ‘Summary Plan Description,’ describing your rights, so you can start by reading this book.

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Are pension benefits taxable?

Whether your pension benefits are taxable depends on several factors. Your pension benefits can be fully or partially taxable depending on how and when you contributed to the fund. It is also important to note that employer-funded pensions are treated somewhat differently than IRA and 401(k) accounts.

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Do ERISA regulations require all companies to offer a retirement plan?

Federal law does not require employers to offer retirement plans to their employees. If employers choose to offer retirement plans, they must follow strict guidelines regarding how the plans are managed, operated, and presented to employees. The Employee Retirement Income Security Act (ERISA) is the law that governs all retirement plans in the United States.

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Are pension plans insured?

Whether or not your pension plan is insured will depend on the type of pension plan you have. Subject to certain limitations, the Pension Benefit Guaranty Corporation insures certain benefits under defined benefit pension plans. There is generally no insurance for a defined contribution plan.

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What parts of my pension plan does ERISA cover?

ERISA, the Employee Retirement Income Security Act, is designed to protect employees by providing uniform standards that employers must meet when establishing employee benefit plans. Not all plans fall under the protection of ERISA, but for those that do, there are a number of aspects of the plan that will be protected under ERISA standards or requirements.

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