General Retirement Plan questions
How is my pension different from a 401(k) plan?
Your Retirement Plan is a defined benefit plan, and a 401(k) is a defined contribution plan. A defined benefit plan provides you with a specific monthly benefit when you become eligible for a benefit, typically based on a formula that takes into account your earnings and years of service. A defined contribution plan provides a benefit based on the amount contributed and is affected by investment gains and losses, income and expenses. Unlike this defined benefit plan, a 401(k) defined contribution plan receives contributions that employees voluntarily elect to defer from their salary.
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What are AFTRA-covered earnings?
AFTRA-covered earnings are compensation for services performed under an AFTRA collective bargaining agreement for which an employer is obligated to contribute to the AFTRA Retirement Fund.
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What are employer contributions?
Employer contributions are paid to the AFTRA Health & Retirement Funds on your behalf for work done under AFTRA-negotiated collective bargaining agreements. The contribution amount is based on a percentage of your AFTRA-covered earnings as outlined in the collective bargaining agreement(s) under which work was performed. Contributions received by AFTRA H&R are used to support benefits provided through the AFTRA Health and Retirement Plans. Under recent changes to the AFTRA Retirement Plan, effective May 1, 2009, your pension accruals will be calculated using a percentage of the employer contributions made on your behalf.
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What is Vesting Service and how do I earn it?
Vesting Service determines whether you have a non-forfeitable entitlement to a pension. Generally, you become vested after you earn five Pension Credits, and you earn Pension Credits by earning a minimum level of covered earnings in a base year (Dec. 1 – Nov. 30 – see the next FAQ for details). Once you are vested, this means you cannot lose your right to a pension benefit, even if you leave covered employment before reaching the age when you can apply for a Retirement Plan benefit. Note that there is no “partial vesting,” meaning that you must be fully vested to receive a pension.
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What are Pension Credits, and how do I earn them?
Pension Credits are used to determine which base years (Dec. 1 through Nov. 30) will count toward the calculation of pension benefits under the AFTRA Retirement Plan. You earn a Pension Credit for each base year that you reach or surpass a minimum level of AFTRA-covered earnings (see chart below):
Minimum covered earnings required to earn a Pension Credit:
| Time period | Minimum AFTRA-covered earnings |
| For base years December 1, 1989 - November 30, 1990 through December 1, 2001 - November 30, 2002 … | $5,000 annual minimum
AFTRA-covered earnings |
| For base years December 1, 2002 - November 30, 2003 through December 1, 2008 - November 30, 2009 … | $7,500 annual minimum
AFTRA-covered earnings |
| For base years December 1, 2009 - November 30, 2010 and after … | $15,000 annual minimum
AFTRA-covered earnings |
Note: Grandfathering provisions allow certain performers to earn Pension Credits and/or Vesting Service for covered earnings less than the amounts listed in the chart above. If you had covered earnings prior to Nov. 30, 2002, refer to pages 11-13 of the 2006 Retirement Plan Summary Plan Description or call Participant Services at 1-800-562-4690 to determine how these special provisions may apply to you.
To confirm how many Pension Credits you have accumulated or your vesting status, call Participant Services at 1-800-562-4690 or send a written inquiry to AFTRA H&R.
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How is my pension calculated?
Effective May 1, 2009, the formula for calculating pension accruals under the Retirement Plan will be changed to a contribution-based methodology. All AFTRA-covered employment resulting in employer contributions credited on or after May 1, 2009 will be applied toward future retirement benefits under this new contribution-based formula.
(Earnings prior to May 1, 2009 will continue to be credited under the previous earnings-based formula. Refer to pages 14-17 of the 2006 Retirement Plan Summary Plan Description to calculate pension accruals for earnings prior to May 1, 2009.)
Under the new contribution-based formula which determines the portion of your retirement benefit earned on and after May 1, 2009, AFTRA H&R will calculate the annual amount of your Regular Annuity payable at age 65 (the Normal Retirement Age) based on:
- The total amount of employer contributions credited on your behalf to the AFTRA Health & Retirement Funds in each base year (Dec. 1 – Nov. 30) in which you earn a Pension Credit
... multiplied by ...
- The contribution-based accrual rate of 4.86%.
Employer contributions are required by the collective bargaining agreements (CBAs) under which you work and vary from agreement to agreement, but generally range from 10% to 14.5% of covered earnings. The new contribution-based formula recognizes the fact that you may work under many different contracts with different contribution rates and at different salary levels. Therefore, when you work under a CBA that requires a higher employer contribution rate, you will accrue a larger benefit under the Retirement Plan.
Exceptions: This rate will not be applied to contributions based on Covered Earnings in excess of the current maximum limit of $200,000 (see maximum earnings chart below) or to any one-time Sound Code payments to the Health Fund or to the employer contributions on behalf of participants who have previously chosen, under certain collective bargaining agreements, for those employer contributions to be made to the Health Fund only.
Maximum earnings considered for benefits
| Time period | Maximum earnings
considered for benefits |
| All Base Years prior to December 1, 1992 | $200,000
|
| Base Year beginning December 1, 1992 | $228,860
|
| Base Year beginning December 1, 1993 | $235,840
|
| Base Year beginning December 1, 1994 | $242,280
|
Base Year beginning December 1, 1995
| $245,000
|
Base Year beginning December 1, 1996
| $250,000
|
Base Years beginning December 1, 1997
through Base Year beginning December 1, 1999
| $160,000
|
Base Years beginning December 1, 2000
through Base Year beginning December 1, 2006
| $170,000
|
Base Years beginning December 1, 2007
and after (this maximum is currently in effect)
| $200,000
|
To learn more and view examples which provide comparisons between the new contribution-based formula and the previous earnings-based formula, refer to the April 2009 Benefits Update.
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If I return to work after I start collecting my pension, how does it affect my monthly payment? Is my retirement payment re-calculated?
If you perform AFTRA-covered work after your retirement (or if you receive residuals or royalties) and earn additional Pension Credits, your monthly benefit will be recalculated. If this occurs, any increase to your monthly benefit will become payable on June 1 following the Base Year (December 1 – November 30) in which the additional Pension Credit was earned.
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Can I make my own contributions to the Retirement Plan?
No, you may not make your own contributions to the Retirement Plan.
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Can I take a loan against my pension?
No. The Retirement Plan does not allow it.
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Can I assign my pension?
No. The Retirement Plan does not allow it.
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I am in the process of a divorce and I want to know how I can divide my AFTRA Retirement Fund pension with my spouse.
A Domestic Relations Order must be submitted. A draft of the Order should be forwarded to the Retirement Services Department at AFTRA H&R for review to determine if it meets the Plan requirements for Qualified status. If AFTRA H&R does not have a Qualified Domestic Relations Order (QDRO) on file, it cannot pay retirement benefits to anyone other than the participant.
Refer to pages 34-35 of the 2006 Retirement Plan Summary Plan Description and relevant Benefits Updates for additional information.
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What is a QDRO, and how would a QDRO affect my pension?
A Qualified Domestic Relations Order (QDRO) is a legal order or decree that requires the AFTRA H&R to pay all or a portion of a participant’s pension benefits to an alternate payee for child support, alimony or spousal rights. You will be notified immediately if we receive a QDRO for your benefits. You or your beneficiary may request a free copy of AFTRA H&R’s procedures for determining the validity of QDROs at any time by calling Participant Services at 1-800-562-4690.
Refer to pages 34-35 of the 2006 Retirement Plan Summary Plan Description and relevant Benefits Updates for additional information.
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If a QDRO is in effect and I work after my divorce, is my pension affected?
The terms of the QDRO will govern how much you or your ex-spouse will receive. In most cases, the ex-spouse is not entitled to that portion of your benefits resulting from Pension Credits earned after the end of the marital period.
Refer to pages 34-35 of the 2006 Retirement Plan Summary Plan Description and relevant Benefits Updates for additional information.
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If a QDRO is in effect, can my ex-spouse name me as a beneficiary of his/her portion of my pension benefits?
There is no Retirement Plan provision that prevents an ex-spouse from naming you as a beneficiary of his/her legally entitled portion of your benefits. However, the provisions of the QDRO typically govern the payment of any survivor benefits.
Refer to pages 34-35 of the 2006 Retirement Plan Summary Plan Description and relevant Benefits Updates for additional information.
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