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What is a cash balance formula?
What is a cash balance formula?
- A formula that defines benefits based on your age and years of service, allowing you to receive a traditional pension plan benefit upon retirement
- A formula that defines benefits based on your education level and certifications, allowing you to receive a higher salary
- A formula that defines benefits based on your account balance, allowing you to take the entire value of your cash balance benefit with you when you leave the company (correct)
- A formula that defines benefits based on your job title and performance, allowing you to receive a bonus at the end of the year
How is the value of your cash balance account calculated?
How is the value of your cash balance account calculated?
- Opening/account balance x Pay credits x Interest credits = Closing Balance
- Opening/account balance + Pay credits + Interest credits = Closing Balance (correct)
- Opening/account balance - Pay credits + Interest credits = Closing Balance
- Opening/account balance + Pay credits - Interest credits = Closing Balance
How are interest credits calculated and applied in the cash balance formula?
How are interest credits calculated and applied in the cash balance formula?
- The monthly interest crediting rate is derived from the average annual yield on the 5-year U.S. Treasury bond at the end of the second full business week of the month immediately prior to the quarter in which such monthly interest credit is to apply, subject to a minimum rate of 1% and a maximum rate of 6%
- The monthly interest crediting rate is derived from the average annual yield on the 20-year U.S. Treasury bond at the end of the first full business week of the month immediately prior to the quarter in which such monthly interest credit is to apply, subject to a minimum rate of 3% and a maximum rate of 8%
- The monthly interest crediting rate is derived from the average annual yield on the 30-year U.S. Treasury bond at the end of the third full business week of the month immediately prior to the quarter in which such monthly interest credit is to apply, subject to a minimum rate of 4% and a maximum rate of 9% (correct)
- The monthly interest crediting rate is derived from the average annual yield on the 10-year U.S. Treasury bond at the beginning of the quarter in which such monthly interest credit is to apply, subject to a minimum rate of 2% and a maximum rate of 7%
What are the two subaccounts that make up a participant's Cash Balance Account if they were in the plan prior to January 1, 2014?
What are the two subaccounts that make up a participant's Cash Balance Account if they were in the plan prior to January 1, 2014?
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When do Pay Credits get allocated to a participant's Cash Balance Account?
When do Pay Credits get allocated to a participant's Cash Balance Account?
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What percentage of monthly eligible pay is allocated as Pay Credits to a participant's Cash Balance Account if they are 50 to 64 years old and have worked for the company for 10 years?
What percentage of monthly eligible pay is allocated as Pay Credits to a participant's Cash Balance Account if they are 50 to 64 years old and have worked for the company for 10 years?
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