Pension survivor election & PBGC guarantee

If you have a traditional pension, you make one choice at retirement that you can almost never take back: a bigger check that stops when you die, or a smaller one that keeps paying your spouse for life. Get it wrong and the person who finds out is your widow or widower, years later, when nothing can be done. This shows what each option really costs — and what happens to the money if the plan itself fails.

Monthly pension — single life the bigger figure on your election form: pays you for life, stops the month you die Monthly pension — joint & survivor the reduced figure on the same form. Plans set this by their own actuarial factors, so use your number — we will not guess it Survivor percentage what your spouse keeps after you die, under that J&S option Years you expect to collect it from when the pension starts until your death Years your spouse would outlive you Who sponsors the plan? this decides whether PBGC insures it at all Years of credited service only used for a multiemployer plan, where the guarantee is per year of service

A planning estimate, not advice. The reduction is your plan’s to set: joint-and-survivor factors are actuarial and vary by plan, your age and your spouse’s age, so this tool asks for the two figures your election form already shows rather than inventing a factor. The break-even ignores investment returns, taxes and any COLA. Federal law puts your spouse in this decision: for a married participant the plan’s default is a qualified joint and survivor annuity, and electing out of it requires your spouse’s written consent, witnessed by a plan representative or a notary public (26 U.S.C. §417); a QJSA’s survivor share must be at least 50% and no more than 100% of the joint-lives amount, and the election period is the 180 days ending on the annuity starting date. Some plans offer a “pop-up” that restores your full check if your spouse dies first — ask. Talk to your plan administrator and a fee-only advisor before you sign.