Any pension option you choose will pay you an income for the rest of your life. There is no 'best' pension option. These choices are designed so you can pick the one that works best for you. From the perspective of the Plan, they're all expected to pay out the same amount of money. The options you can choose from depend on whether you have a Pension Partner when you retire.
A pension partner is how we refer to a spouse or partner, and is someone who:
Pension options if you have a Pension Partner (Joint Lifetime Options)
Pension options if you do not have a Pension Partner (Single Lifetime Options)
Historical pension options no longer available for new retirements
Pension options if you have a Pension Partner (Joint Lifetime Options)
If you have a pension partner when you retire, legislation requires you to choose a pension that continues to pay for as long as either of you is alive. This is called a Joint Lifetime pension. If you pass away first, they will continue to receive a lifetime pension.
If you would like to choose a pension option that pays for your lifetime only, your pension partner can choose to sign a Pension Partner Waiver, giving up the right to a survivor pension.
| Scenarios to consider | Joint Lifetime Reduced by 1/3 on Member's Death Only and Guaranteed 5 Years | Joint Lifetime Reduced by 1/3 on First Death of Member or Pension Partner and Guaranteed 5 Years* | Joint Lifetime Guaranteed 5 Years |
|---|---|---|---|
| New option if you're retiring on or after January 1, 2024. | Existing option. | Existing option. | |
| Your pension partner passes away before you. | Monthly pension is not reduced and paid for your lifetime. | Monthly pension is reduced by 1/3 and paid for your lifetime. | Monthly pension is not reduced and paid for your lifetime. |
| You pass away before your pension partner after 5 years from the date your pension begins. | Monthly pension is reduced by 1/3 and paid for your pension partner’s lifetime. | Monthly pension is reduced by 1/3 and paid for your pension partner’s lifetime. | Monthly pension is not reduced and paid for your pension partner’s lifetime. |
| Within 5 years from the date your pension begins, you pass away before your pension partner. | Monthly pension is not reduced for the remainder of the 5 years, then reduced by 1/3 afterwards and paid for your pension partner’s lifetime. | Monthly pension is reduced by 1/3 and paid for your pension partner’s lifetime. | Monthly pension is not reduced and paid for your partner’s lifetime. |
| Within 5 years of the date your pension begins, both you and your pension partner pass away. | Monthly pension is not reduced and is paid for the remainder of the 5 years to your beneficiaries. | Monthly pension is reduced by 1/3 and is paid for the remainder of the 5 years to your beneficiaries. | Monthly pension is not reduced and is paid for the remainder of the 5 years to your beneficiaries. |
Joint Lifetime Reduced by 1/3 on Member's Death Only and Guaranteed 5 Years
The new pension option will be available for retirements starting from January 1, 2024, for members with a pension partner, but does not apply to anyone who retired/retires before that date.
Called the 'Joint Lifetime Reduced by 1/3 on Member’s Death Only and Guaranteed 5 Years,' the new option will be payable for the lives of the member and/or the pension partner — just like the two existing Joint Lifetime pension options.
With this option, when your pension partner passes away, your pension is not reduced and is paid for your lifetime. If you pass away before your pension partner, but within five years of starting your pension, your pension partner will receive the full pension until the five-year mark has passed. Then the pension is reduced by 1/3.
Joint Lifetime Reduced by 1/3 on First Death of Member or Pension Partner and Guaranteed 5 Years*
This option is paid for the lives of you and your pension partner. When either you or your pension partner pass away, the monthly pension paid to the survivor will be reduced by 1/3. This means that if your pension partner passes away before you, your pension will be reduced to 2/3 of the original pension amount.
If both you and your pension partner have passed away within five years of the date your pension started, any payments remaining in this period will be paid at the reduced amount to your chosen beneficiary.
*Previously called ‘Joint Lifetime Reduced by 1/3 Guaranteed at Least 5 Years.’ The name has been changed to clarify the differences between the pension options, and no other changes were made.
Joint Lifetime Guaranteed 5 Years
This option is paid for the lives of you and your pension partner. When either you or your pension partner pass away, the survivor will continue to receive the same amount of pension for life.
If both you and your pension partner have passed away within five years of the start of your pension, any payments remaining in this period will be paid to your chosen beneficiary.
Pension Options if you don't have a Pension Partner (Single Lifetime Options)
The Single Lifetime pension options are paid to you for as long as you live. These options can only be chosen if you don't have a pension partner at retirement, or if your pension partner chooses to sign a Pension Partner Waiver and gives up any right to a survivor pension.
If your pension partner completes a Pension Partner Waver on or after March 1, 2021, giving up rights to a survivor pension and you choose a Single Lifetime pension option with a guaranteed period, your pension partner is automatically the sole designated beneficiary of the guaranteed period. Your pension partner can also complete a Death Benefit Waiver giving up that right to be the sole beneficiary of the guaranteed period and you can name any beneficiary.
Note: If your pension partner completed a waiver prior to March 1, 2021, they are not required to be the sole designated beneficiary of the guaranteed period.
| Pension option name | Member pension payment duration | Guaranteed term benefit paid to chosen beneficiaries on death of member |
|---|---|---|
| Single Lifetime. | Lifetime. | None. |
| Single Lifetime Guaranteed 5 Years. | Lifetime. | Guaranteed term is 5 years from pension start date. |
| Single Lifetime Guaranteed 10 Years. | Lifetime. | Guaranteed term is 10 years from pension start date. |
| Single Lifetime Guaranteed 15 Years. | Lifetime. | Guaranteed term is 15 years from pension start date. |
Single Lifetime
This option is paid for your lifetime. No payments are paid to anyone after you pass away.
Guaranteed Term Options
These pension options are paid to you for as long as you live. If you pass away before the end of the guarantee period, the designated beneficiaries will continue to receive payments until the end of the guarantee period. When you see your own pension options you will notice that the longer the guaranteed term is, the smaller the amount of pension.
If you have a pension partner at retirement and your pension partner completes a Pension Partner Waiver on or after March 1, 2021, but they do not complete a Death Benefit Waiver, your pension partner is automatically your sole designated beneficiary of the guaranteed period.
Single Lifetime Guaranteed 5 Years
A pension paid for as long as you live. If you pass away within 5 years of starting your pension, the designated beneficiaries will continue to receive pension payments until the end of the 5-year guaranteed period.
Single Lifetime Guaranteed 10 Years
A pension paid for as long as you live. If you pass away within 10 years of starting your pension, the designated beneficiaries will continue to receive pension payments until the end of the 10-year guaranteed period.
Single Lifetime Guaranteed 15 Years
A pension paid for as long as you live. If you pass away within 15 years of starting your pension, the designated beneficiaries will continue to receive pension payments until the end of the 15-year guaranteed period.
Historical pension options no longer available for new retirements
LAPP has previously offered three Joint Lifetime pension options and one Single Lifetime guaranteed term pension option which are no longer available to be chosen.
Coordination
If you chose coordination when you started your pension, the coordination increase will be removed after you turn 65 and a permanent reduction will start. If you need a reminder of what the reduction to your pension will be at age 65, you can see that amount on your Pensioner Annual Statement or when you log in to Your Pension Profile.
Will the amount of my pension change?
Historical Joint Lifetime pension options
| Pension option name | Member pension payment duration | Survivor pension duration | Reduction on death of member or pension partner | Guaranteed term benefit paid to chosen beneficiaries if both member and pension partner pass away |
|---|---|---|---|---|
| Joint Lifetime. | Lifetime. | For survivor's lifetime. | No Reduction. | None. |
| Joint Lifetime Reduced by 1/3. | Lifetime. | Lifetime. | Reduced by 1/3. Pension paid will be 2/3 of the original amount. | None. |
| Joint Lifetime Reduced by 1/2. | Lifetime. | Lifetime. | Reduced by 1/2. Pension paid will be 1/2 of the original amount. | None. |
Joint Lifetime
This option is paid for the lives of you and your pension partner. On the passing away of either you or your pension partner, the pension is paid to the survivor for his or her lifetime. The same monthly pension amount is paid as long as either you or your pension partner is alive.
Note: There is no guarantee for this pension option. If both you and your pension partner pass away, no further payments are made.
Joint Lifetime Reduced by 1/3
This option is paid for the lives of you and your pension partner. On the first pass away of either you or your pension partner, the monthly payment is reduced by 1/3. This means that if your pension partner passes away before you, your pension will be reduced to 2/3 of the pension amount.
Note: There is no guarantee for this pension option. If both you and your pension partner pass away, no further payments are made.
Joint Lifetime Reduced by 1/2
This option is paid for the lives of you and your pension partner. On the first passing away of either you or your pension partner, the monthly payment is reduced by 1/2. This means that if your pension partner passes away before you, your pension will be reduced to 1/2 of the pension amount.
Note: There is no guarantee for this pension option. If both you and your pension partner pass away, no further payments are made.
Historical Single Lifetime pension options
| Pension option name | Member pension payment duration | Guaranteed Term Benefit Paid to Chosen Beneficiaries on Death of Member
|
|---|---|---|
| Single Lifetime Guaranteed 20 Years (Guaranteed 20-year term). | Lifetime | Guaranteed term is 20 years from pension start date. |
Single Lifetime Guaranteed 20 Years (Guaranteed 20-year term)
This pension option is paid to you for as long as you live. If you pass away before the end of the 20-year guarantee period, the beneficiaries you have chosen will continue to receive payments until the end of the 20-year guarantee period.
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