Few investments are more important than the one you have in your pension plan. Because the average American will rely on pension savings for 18 years after retirement, it is essential that you understand your rights and obligations under your pension plan.
Participants in pension plans have certain rights that are governed by federal law. They also have obligations. Similarly, the people who sponsor your pension plan also have rights and obligations. Most are spelled out by a law called the Employer Retirement Income Security Act of 1974 (ERISA). The purpose of this booklet is to explain some of the most important features of this law.
This booklet explains, for example, the role of different federal agencies in regulating pension plans. It describes the obligations of your employer (or other appropriate plan official) to provide you with information about the plan, and tells you what information must be made available automatically, at regular intervals, and, in many cases, at no cost to you. It also points out the importance of keeping informed on any changes in your plan's rules of operation.
This booklet tells you what is generally required to become eligible for your pension plan, including how long you may have to be an employee before becoming a participant. Important concepts such as accruing benefits and being vested in your pension are explained. The booklet also answers common questions about changes in your employee status might affect your pension, such as termination or returning to your job after an interruption of employment. And it discusses the potential impact on your pension plan of mergers, acquisitions and plant shutdowns.
Other important features of this booklet include:
The information contained in the following pages answers many of the most common questions about pension plans. Keep in mind, however, that this booklet is a simplified summary of participant rights and responsibilities, not a legal interpretation of ERISA.
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