Underpayment of Lump Sum Pension Distribution

#1 03-31-2006, 09:57 AM

The pension in question is a cash balance plan with monthly interest
credits paid at the end of each calendar month. The monthly interest
credit rate varies yearly and is based on the one-year U.S. Treasury
rate plus a fixed percentage. It is a conservative plan which pays a
far lower return than average S&P 500 returns.

My year end statement shows a larger amount than I actually received.
As for the outcome, I've written the plan administrator and am still
waiting for a positive result.

Bread wrote:
- quote -

> [old thread. I'm mainly curious what actually happened to this guy:]
> On 2006-02-22 19:06:58 -0500, John Baker <cici[at]remove.bellsouth.net> said:
> > I recently rolled over a defined benefit pension plan into an IRA.
> > The plan administrator correctly calculated the roll over amount at
> > the time I requested the payment paperwork. However, I was unable
> > to complete the paper work immediately and by the time I received the
> > payment two months had elapsed. The payout I received did not include
> > two months of interest, a couple hundred dollars.
> What makes you think you should have gotten those two months of interest?
> At the time they get your submission of a request, they probably
> roll your share of the pension plan over into a cash account which
> may or may not earn interest. (that "correctly calculated amount").
> That cash account may or may not have been interest-bearing. If it's
> an account used for regular distributions and payments, it very well
> not be interest-bearing.
> > Is it common practice for pension companies to define lump sum roll
> > over payment calculations as valid for 90 days when they know it will
> > benefit them directly if the roll over receiptient doesn't return the
> > paper work promptly?
> What do you think was done with your money between the time you
> requested the rollover and the time you submitted the paperwork?
> Contact the trustee and ask these questions.

======================================= MODERATOR'S COMMENT:
Please trim the post to which you are responding. "Trim" means that except for a few lines to add context, the previous post is deleted.

03-10-2006, 04:10 PM

[old thread. I'm mainly curious what actually happened to this guy:]

On 2006-02-22 19:06:58 -0500, John Baker <cici[at]remove.bellsouth.net> said:

- quote -

> I recently rolled over a defined benefit pension plan into an IRA. The
> plan administrator correctly calculated the roll over amount at the
> time I requested the payment paperwork. However, I was unable to
> complete the paper work immediately and by the time I received the
> payment two months had elapsed. The payout I received did not include
> two months of interest, a couple hundred dollars.

What makes you think you should have gotten those two months of interest?

At the time they get your submission of a request, they probably
roll your share of the pension plan over into a cash account which
may or may not earn interest. (that "correctly calculated amount").

That cash account may or may not have been interest-bearing. If it's
an account used for regular distributions and payments, it very well
not be interest-bearing.

- quote -

> Is it common practice for pension companies to define lump sum roll
> over payment calculations as valid for 90 days when they know it will
> benefit them directly if the roll over receiptient doesn't return the
> paper work promptly?

What do you think was done with your money between the time you
requested the rollover and the time you submitted the paperwork?

Contact the trustee and ask these questions.

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#-1 02-22-2006, 11:06 PM

I recently rolled over a defined benefit pension plan into an IRA. The
plan administrator correctly calculated the roll over amount at the time
I requested the payment paperwork. However, I was unable to complete
the paper work immediately and by the time I received the payment two
months had elapsed. The payout I received did not include two months of
interest, a couple hundred dollars.

Do I have any legal recourse to collect monies that I feel the trust
company should have included automatically? I have a year end statement
which shows monies in the pension greater than what I received. Is it
common practice for pension companies to define lump sum roll over
payment calculations as valid for 90 days when they know it will benefit
them directly if the roll over receiptient doesn't return the paper work
promptly?

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