Loading
Continued Employee Benefits after you Retire
You’ve worked hard for a company. You’ve given them 10-50 years of loyal service and hard work day in and day out. And now that it’s come time to retire you should be rewarded right?
All companies are different when it comes to employee benefits for those who have retired. While some reward you with a party and a gold watch, others offer you continued services, usage and benefits.
For example, if you have worked at a University for 10 or more years you can expect much of the same employee benefits that you received when you were teaching. This includes health care (but not dental care), and life insurance. You will also have free access to the library, the gym facilities, the computer rooms and discounted tuition fees if you choose to spend your free time going back to school.
So what can you expect from your place of employment?
It’s best to always look at your specific employment contract which will specify the benefits of retiring from your company. There are different types of retirement plans that offer different ways to receive retirement benefits. You have certain responsibilities and some circumstances, such as a divorce or a change of employment may affect your retirement benefit plan.
This is why it’s so important to understand your employee benefit retirement plan.
The Two Main Types of Employee Benefit Retirement Plans
For jobs not connected to the government there are two different types of retirement plans. A defined benefit plan will give you a specific monthly benefit at your retirement. This defined benefit is usually calculated against factors such as age, salary, number of years you have worked for the company, etc. Every month you can expect the same amount of money and benefits as the previous month.
A defined contribution plan, however, does not offer a specific amount each month. Instead you have a say in what happens. Both you and your employee can contribute money to your account and you choose where to invest the money. You choose how much you want to give each pay check to retirement. In a sense, you determine your own retirement benefits.
Other Considerations of your Retirement Benefit Plan
Another important thing to must look into when you begin with a company is if you are actually eligible to earn retirement benefits. For example, part time or casual employees may not be entitled to a retirement benefit plan. In most companies you do not begin accruing benefits until you have been with the company for at least a year and are over the age of 21.
Once you have determined whether you can participate or not, you need to understand how the system works. When will you have access to the funds? Where do the funds go? What happens if I quit or am fired? These are all important questions you must discuss with your employer.
After all, your present employee benefit plan will directly impact your retirement and your future.