Can PBGC determine the exact monthly benefit amount now?
A5: Whether PBGC can exactly determine your cash-balance monthly benefit depends, in part, on when the cash balance rates that your plan requires are available. Your monthly pension amount is the result of dividing your Account Balance by an “Annuity Conversion Factor” (see Q&A2). Your plan specified that the Annuity Conversion Factor is to be based on the Group Annuity Mortality Table (weighted 50% male/50% female) and 30-year U.S. Treasury Bond interest rate (in effect November of the year before your benefits begin) minus 0.5%. Because we won’t know the interest rate to use until you are ready to begin receiving benefits, we can only estimate what your Account Balance will be when you are ready to begin receiving your benefit. As a result, we can only calculate an estimate of your monthly pension benefit. In addition, there are certain limits on the benefits that PBGC can legally pay. PBGC determines whether and the extent to which those limits affect your benefit when calculating y
A4: Whether PBGC can exactly determine your cash balance monthly benefit depends, in part, on when the cash balance rates that your plan requires are available. Your monthly pension amount depends on how large your Account Balance is when you begin receiving monthly retirement benefits (see Q&A1). That Account Balance will have grown with interest from when the plan ended to when you begin receiving your benefits. Your plan specified the 30 Year Treasury Rates. Because we don’t know future interest rates, we can only estimate what your Account Balance will be when you are ready to begin receiving benefits. In addition, your monthly pension amount is a result of dividing your Account Balance by an “Annuity Conversion Factor” (see Q&A2). Your plan specified that the Annuity Conversion Factor is to be based on 30 Year Treasury Rates. Because we won’t know the interest rate to use until you are ready to begin receiving benefits, we can only estimate what your Account Balance will be when y
