By now, many of you have had the opportunity to review a sample of the new forms that are being sent to you when one of your LOSAP Participants reaches entitlement age. The new paperwork typically begins with a letter to the Plan Sponsor, which includes pertinent information such as:
- the actuary’s recommendation regarding Plan funding,
- the Plan’s current investment fund balance,
- current interest rate and funding ratio and
- the estimated cost to purchase an annuity for a particular Participant.
When returning this letter to our office, the Sponsor must indicate how they wish to pay the Participant’s service award benefit:
- by purchasing an annuity through American General or
- by issuing payments from the Plan’s investment fund held with MassMutual.
The payment option selected by the Sponsor dictates which of the two sets of entitlement paperwork the service award participant must complete as the forms are specific to either American General or MassMutual. Should you have any questions when you receive this new paperwork, please contact your Pension Administrator in our office for assistance.
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