Population: New or Prospective Non-Represented
Your Pension Plan
Your pension benefit provides a monthly income during retirement and also helps you give your spouse or other survivor additional financial protection after your death. Your benefit is based on your years of service and final average earnings, and is completely funded by the Company. You make no contributions.
- Provisions of the Pension Plan (an easy guide about your retirement benefits)
- What Does Your Benefit Equal?
- The Supplemental Pension Benefit
- What Are Your Payment Options?
- What If You Retire or Leave PSEG?
What Does Your Benefit Equal?
Your benefit is determined using this formula:
1.3% of your final average earnings up to $24,600
plus
1.5%
of your final average earnings in excess of $24,600
times
Your years (and partial years) of credited service up to 35 years
plus
1.5% of your final average earnings for each year (and partial year) of credited service in excess of 35
equals
Your Pension Benefit
To estimate your pension benefit, log on to Your Benefit Resources™.
Your final average earnings will be calculated using the highest five years of earnings during all service (looking back to January 1, 1995).
The Supplemental Pension Benefit
The supplemental pension benefit is an additional $4.00 for each year of service you worked for the Company (partial years are rounded up). This benefit ends the month after you reach age 65.
What Are Your Payment Options?
You may choose to receive your pension benefit as a:
- Single Life Annuity (payments for your life only);
- 100% Joint and Survivor Annuity (reduced payments for your life, then continuing payments in the same amount to your beneficiary for his or her life);
- 75% Joint and Survivor Annuity (reduced payments for your life, then continuing payments of 75% of the amount you received to your beneficiary for his or her life)
- 50% Joint and Survivor Annuity (reduced payments for your life, then continuing payments of 50% of the amount you received to your beneficiary for his or her life).
Survivor benefits provide income to your spouse if you die before retirement. Annuity options provide income to your spouse if you die after retirement (but before your spouse dies). If you’re married, you’ll need the consent of your spouse to select a form of payment other than the 50% Joint and Survivor Annuity.
Note: You may not designate a non-spouse beneficiary for the 100% Joint and Survivor Annuity who is more than 10 years younger than you. There is no age limitation for a spouse beneficiary designation.
What If You Retire or Leave PSEG?
If you leave PSEG
- If you have less than five years of vesting service and you leave PSEG before age 65, you lose your pension.
- If you have at least five years of service and you leave PSEG before your age and service combine to equal 80, you may receive:
- A monthly benefit beginning at age 65;
- An immediately payable benefit actuarially reduced from age 65; or
- A lump sum.
If you are disabled, you may be eligible for a disability pension available after five years of service. If you are eligible, you may elect either a Single Life Annunity or a 100% or 50% Joint and Survivor Annuity.
If you retire
The Pension Plan provides for normal retirement at or after age 65.
Early retirement
Early retirement is available when your age plus your years of credited service equal at least 80. But your pension is reduced 7% for each year and prorated month you are under age 60. You are eligible for unreduced early retirement benefits if you are:
- At least age 60 when your age and service combine to equal at least 80; or
- At least age 55 with at least 25 years of service.
Keep in mind that your pension and Social Security benefits alone may not provide adequate income at retirement. When establishing a retirement savings strategy, you also should consider your personal savings through the Thrift or Savings Plan.
For additional information on preparing a retirement savings strategy, go to the Financial Planning and the Retirement Planning sections.
For more information, see the Pension
Plan summary plan description.