# In order for a severance pay plan to not be treated as an ERISA pension plan, how many months...

## Question:

In order for a severance pay plan to not be treated as an ERISA pension plan, how many months does the employer generally have to complete employee payments?

## ERISA:

ERISA, or Employee Retirement Income Security Act, is a federal law that establishes the minimum requirements and operational procedures for pension plans and employee benefit plans.

## Answer and Explanation:

Become a Study.com member to unlock this answer! Create your account

View this answerSee full answer below.

#### Ask a question

Our experts can answer your tough homework and study questions.

Ask a question Ask a question#### Search Answers

#### Learn more about this topic:

from

Chapter 8 / Lesson 13In the United States, ERISA Law helps protect workers' benefit plans that are funded by private employers. Discover more about the ERISA Law, including what plans are covered, plan standards, fiduciary duties, and how this law is enforced.

#### Related to this Question

- This arrangement has employees of a firm participate in the company's earnings. a. ERISA b. Vested rights c. Noncontributory pension plan d. Contributory pension plan e. Defined contribution plan f. Defined benefit plan g. Qualified pension plan h. Profit
- An employee and employer contrubute $3,000 annually for 20 years to a retirement account that earns 9 percent a year, how much will the employee be able to withdraw from the account for 25 years?
- This type of plan has the employee and employer making the total contributions. a. ERISA b. Vested rights c. Noncontributory pension plan d. Contributory pension plan e. Defined contribution plan f. Defined benefit plan g. Qualified pension plan h. Profit
- This pension plan uses a formula, stipulated in its provisions, for computing benefits. a. ERISA b. Vested rights c. Noncontributory pension plan d. Contributory pension plan e. Defined contribution plan f. Defined benefit plan g. Qualified pension plan h
- Your father's employer was just acquired, and he was given a severance payment of $550,000, which he invested at a 3.5% annual rate. He now plans to retire, and he wants to withdraw $25,000 at the end
- This pension plan imposes certain criteria that must be met before the employee can obtain a nonforfeitable right to a pension. a. ERISA b. Vested rights c. Noncontributory pension plan d. Contributory pension plan e. Defined contribution plan f. Defined
- This type of plan has the employer paying the total contribution costs. a. ERISA b. Vested rights c. Noncontributory pension plan d. Contributory pension plan e. Defined contribution plan f. Defined benefit plan g. Qualified pension plan h. Profit-sharing
- This made extensive changes to the Employee Retirement Income Security Act (ERISA) of 1974 which governs employer-sponsored, qualified (for tax deferral) retirement-benefit plans. a. Short-Term Severance Pay laws b. Employer Cost Shifting laws c. The Pens
- Part of this law encourages employees to make greater use of salary reduction (defined contribution) plans. a. ERISA b. Vested rights c. Noncontributory pension plan d. Contributory pension plan e. Defined contribution plan f. Defined benefit plan g. Qual
- Your pension plan is an annuity with a guaranteed return of 4% per year (compounded quarterly). You can afford to put $1,800 per quarter into the fund, and you will work for 40 years before retiring.
- This pension plan specifies the contribution that each party makes and does not promise the size of the benefit at retirement. a. ERISA b. Vested rights c. Noncontributory pension plan d. Contributory pension plan e. Defined contribution plan f. Defined b
- Suppose your employer offers a monthly annuity at 7.3% annual interest. a. If you can afford to put $800 per month into your annuity, and you wish to retire in 23 years, then how much will your annuity be worth when you retire? b. Suppose instead that y
- What will be the earnings at the time of retirement? You are planning for your retirement and have decided the following: you will retire in 35 years and will make monthly deposits into your retiremen
- How can I get Rs 5 lacs per month as pension at the age of 60 if I am earning Rs 1,00,000 per month at the age of 40?
- You are setting up a retirement plan. You will make fixed monthly contributions to a pension fund, until you retire 30 years from now. After retirement, you are planning to withdraw a fixed amount, A, each month for the next 20 years. Assume that the fund
- This law permits uncovered workers to establish individual tax-sheltered retirement plans. a. ERISA b. Vested rights c. Noncontributory pension plan d. Contributory pension plan e. Defined contribution plan f. Defined benefit plan g. Qualified pension pla
- Your employer has agreed to make quarterly payments of $400 each into a trust account to fund your early retirement. The first payment will be made 3 months from now, and payments will stop after 20 y
- Your employer contributes $70 per week to your retirement plan. Assume you work for your employer for another 20 years and the applicable discount rate is 8 percent. Given these assumptions, what is this employee benefit worth to you today?
- Your employer contributes $75 a week to your retirement plan. Assume that you work for your employer for another 20 years and that the applicable discount rate is 7.5 percent. Given these assumptions, what is this employee benefit worth to you today?
- My pension plan will pay me $15,500 once a year for a 10-year period. The first payment will come in exactly 5 years. The pension fund wants to immunize its position. a. What is the duration of its o
- Your employer uses a flat benefit formula to determine retirement payments to its employees. The fund pays an annual benefit of $4,300 per year of service. Calculate your annual benefit payments for 2
- A pension plan is obligated to make disbursements of $1.1 million, $2.1 million, and $1.1 million at the end of each of the next three years, respectively. The annual interest rate is 11%. If the plan
- A pension plan is obligated to make disbursements of $2.6 million, $3.6 million, and $2.6 million at the end of each of the next three years, respectively. The annual interest rate is 7%. If the plan
- A pension plan is obligated to make disbursements of $1 million, $2 million, and $1 million at the end of each of the next three years, respectively. The annual interest rate is 10%. If the plan wants
- A pension plan is obligated to make disbursements of $3.3 million, $4.0 million, and $3.3 million at the end of each of the next three years, respectively. The annual interest rate is 10%. If the plan
- 1.) A pension plan is obligated to make disbursements of $1 million, $2 million, and $1 million at the end of each of the next three years, respectively. The annual interest rate is 10%. If the plan w
- A pension plan is obligated to make disbursements of $1.4 million, $2.4 million, and $1.4 million at the end of each of the next three years, respectively. The annual interest rate is 8%. If the plan
- A) Why do pension funds have vesting periods? Do vesting periods have any advantages to employees relative to a system where new hires are eligible to participate in a pension plan right away? B) Supp
- You begin working at age 25, and your employer deposits $300 per month into a retirement account that pays an APR of 7% compounded monthly. a) What will be the size of your nest egg at age 65? b) Su
- An employer uses a final pay formula to determine retirement payouts to its employees. The annual payout is 3 percent of the average salary over the employee's last three years of service times the to
- A pension plan is obligated to make disbursements of $10 million, $25 million, and $12 million at the end of each of the next three years, respectively. Find the duration of the plan's obligations if
- A pension plan is obligated to make disbursements of $2.0 million, $3.0 million, and $2.0 million at the end of each of the next three years, respectively. Find the duration of the plan's obligations
- An employer uses a final pay formula to determine retirement payouts to its employees. The annual payout is 4 per cent of the average salary over the employees' last three years of service times the
- You plan to work for 40 years and then retire using a 25-year annuity. You want to arrange a retirement income of $4500 per month. You have access to an account that pays an APR of 7.2% compounded mon
- Assume that you are 35 years old and have just changed jobs. You have $152,000 in a retirement plan from your former employer. You can roll that money into the retirement plan of the new employer. You will also contribute $7,400 each year into your new em
- You begin working at age 25, and your employer deposits $340 each month into a retirement account that pays an APR of 6% compounded monthly. Make a table that shows the size of your nest egg in terms of the age at which you retire. Include retirement ages
- A pension plan is obligated to make disbursements of $2.2 million, $3.2 million, and $2.2 million at the end of each of the next three years, respectively. The annual interest rate is 10%. If the plan wants to fully fund and immunize its position, how muc
- Assume you start working at 20 years old and plan to retire at age 50. You contribute $125 per month to your retirement plan and the company matches it. If you could earn 12.6% annual return over the 30 years, how much money would you have when you retire
- You've decided that you are going to put away money for retirement from each of your paychecks. You plan to deposit $300 from each of your monthly paychecks into an account that earns 6% APR compounded monthly. You friend wants to adopt the same plan but
- You are helping your friend plan for her retirement. Your friend's company has a new pension plan that will deposit $100 at the end of each month into her retirement fund (the first deposit will be made in one month from today). She plans to retire exactl
- Using the following annuity values, how much would a normal retirement benefit need to be reduced at each age in order for the value of the normal retirement benefit to be equal to the value of the early retirement benefit? Immediate Annuity factor = Valu
- A pension plan is obligated to make disbursements of $2.6 million, $3.6 million, and $2.6 million at the end of each of the next three years, respectively. Find the duration of the plan's obligations if the interest rate is 7% annually. (Do not round inte
- A pension plan is obligated to make disbursements of $2.4 million, $3.4 million, and $2.4 million at the end of each of the next three years, respectively. Find the duration of the plan's obligations
- A pension plan is obligated to make disbursements of $2.3 million, $3.3 million, and $2.3 million at the end of each of the next three years, respectively. Find the duration of the plan's obligations
- A pension plan is obligated to make disbursements of $1.7 million, $2.7 million, and $1.7 million at the end of each of the next three years, respectively. Find the duration of the plan's obligations
- A pension plan is obligated to make disbursements of $1.4 million, $2.4 million, and $1.4 million at the end of each of the next three years, respectively. Find the duration of the plan's obligations
- A pension plan is obligated to make disbursements of $1.3 million, $2.3 million, and $1.3 million at the end of each of the next three years, respectively. Find the duration of the plan's obligations
- A pension plan is obligated to make disbursements of $2.7 million, $3.7 million, and $2.7 million at the end of each of the next three years, respectively. Find the duration of the plan's obligations
- Your salary for the coming year is $100,000 (payable one year from now) and you expect to work for another 30 years. You expect your annual base salary to grow at a 4% annual rate during the remainder of your career. Your company's pension plan calls for
- Some companies offer their employees defined benefit pension plans. Under these plans, employees are promised a fixed monthly payment after they retire. The federal government regulates some aspects of these plans. A reporter for the Wall Street Journal w
- You manage a pension fund, which provides retired workers with lifetime annuities. The fund must pay out $1 million per year to cover these annuities. Assume for simplicity that these payments continue for 20 years and then cease. The interest rate is 4%
- You want to have $1,200,000 when you retire and you are in a defined contribution plan. You can earn 9% per year on the money invested and you will retire in 25 years. Your employer also contributes to your plan. The employer will contribute 4% of what yo
- A pension plan is obligated to make disbursements of $1.8 million, $2.8 million, and $1.8 million at the end of the next three years, respectively. Find the duration of the plan's obligation if the in
- An employee has year to date earnings of $113,900. The employee s gross pay for the next pay period is $5,000. If the FICA OASDI is 6.2% and the wage base is $117,000, how much FICA OASDI tax will be
- Mattola Company is giving each of its employees a holiday bonus of $800 on December 15 (a non-payday). The company wants each employee's check to be $800. The supplemental tax percent is used. Nobody has capped for OASDI prior to the bonus check. What wo
- If the pension fund you manager expects to have an inflow of $120 million six months from now, what forward contract would you seek to enter into to lock in current interest rates?
- You plan to retire in 25 years. You have $50,000 currently saved and you plan to save an additional $500 every month (starting one month from now) until you retire. If you expect your retirement savings to grow at 7 percent per year (APR with monthly comp
- Suppose you are 20 years old and you just graduated. You plan to retire at 70 with a retirement fund that must provide you a monthly payment of $3000 at the beginning of each month for 30 years. How much you have to save at the end of each month until ret
- Suppose you are 20 years old and you just graduated. You plan to retire at 70 with a retirement fund that must provide you a monthly payment of $3000 at the beginning of each month for 30 years. How much you have to save at the end of each month until re
- Suppose you are 20 years old and you just graduated. You plan to retire at 70 with a retirement fund that must provide you a monthly payment of $3,000 at the beginning of each month for 30 years. How much you have to save at the end of each month until re
- Suppose you are 20 years old and you just graduated. You plan to retire at 70 with a retirement fund that must to provide you a monthly payment of $3,000 at the beginning of each month for 30 years. How much you have to save at the end of each month until
- You are now 30 years old and would like to accumulate $2,000,000 in your retirement account at age 65. You currently have $50,000 saved in the retirement account. How much must you set aside at the end of each year over the next 35 years to attain your re
- James, age 58, has compensation of $150,000 and wants to defer the maximum to his public 457(b) plan. The normal retirement age for his plan is 60. How much can he defer in 2013 if he has an unused de
- You plan to save $1,400 for the next four years, beginning now, to pay for a vacation. If you can invest it at 6 percent, how much will you have at the end of four years?
- It is estimated that you will pay about $87,500 into the social security system (FICA) over your 35-year work span. For simplicity, assume this is an annuity of $2,500 per year, starting with your 30t
- The Social Security System is an example of a public pension plan that is a pay-as-you-go system. What is a pay-as-you-go pension plan? a. If you want the benefits this year, you must pay into the sys
- Under this plan, the employer not only makes the contributions (based on a percentage of an employee's salary), controls the investment, and guarantees a given payout at retirement, it also creates a separate "account" that details the employee's accumula
- Assume that you are 30 years old today and you are planning on retirement at age 65. Your current salary is $45,000 and you expect your salary to increase at a rate of 5% per year as long as you work. To save for your retirement, you plan on making annual
- A pension plan is obligated to make disbursements of $1.2 million, $2.2 million, and $1.2 million at the end of each of the next three years, respectively. The annual interest rate is 10%. If the plan wants to fully fund and immunize its position, how muc
- You belong to an unusual pension plan because your retirement payments will continue forever (and will go to your descendants after you die). If you will receive $5,000 per month every month forever (in perpetuity) starting 40 years from today (in monthly
- You have accumulated some money for your retirement. You are going to withdraw $73,508 every year at the end of the year for the next 17 years. How much money have you accumulated for your retirement?
- You have accumulated some money for your retirement. You are going to withdraw $93,574 every year at the end of the year for the next 19 years. How much money have you accumulated for your retirement?
- You have accumulated some money for your retirement. You are going to withdraw $53975 every year at the end of the year for the next 30 years. How much money have you accumulated for your retirement?
- You have accumulated some money for your retirement. You are going to withdraw $59,573 every year at the end of the year for the next 18 years. How much money have you accumulated for your retirement?
- You have accumulated some money for your retirement. You are going to withdraw $81,167 every year at the end of the year for the next 15 years. How much money have you accumulated for your retirement?
- You have accumulated some money for your retirement. You are going to withdraw $45,500 every year at the end of the year for the next 20 years. How much money have you accumulated for your retirement?
- You have accumulated some money for your retirement. You are going to withdraw $61,746 every year at the end of the year for the next 28 years. How much money have you accumulated for your retirement?
- You have accumulated some money for your retirement. You are going to withdraw $5,9623 every year at the end of the year for the next 20 years. How much money have you accumulated for your retirement?
- You have accumulated some money for your retirement. You are going to withdraw $88,907 every year at the end of the year for the next 29 years. How much money have you accumulated for your retirement?
- You have accumulated some money for your retirement. You are going to withdraw $92,965 every year at the end of the year for the next 17 years. How much money have you accumulated for your retirement?
- To your age as a round number add four more years. At the end of the month following your birthday in that year, you start adding $375 to a retirement plan that earns 6.24% APR. You will do so at the end of each month until you turn 65. a. How much will
- What is the WITHDRAWAL $___per month - You are planning to save for retirement over the next 30 years. To do this, you will invest $750 per month in a stock account and $350 per month in a bond accoun
- A self-employed person deposits $3,000 annually in a retirement account (called a Keogh or H.R.10 plan) that earns 8 percent. How much additional money will be in the account if the saver defers retirement until age 70 and continues the contributions?
- You have accumulated some money for your retirement. You are going to withdraw $89,019 every year at the end of the year for the next 20 years. How much money have you accumulated for your retirement?
- You have accumulated some money for your retirement. You are going to withdraw $87,479 every year at the end of the year for the next 20 years. How much money have you accumulated for your retirement?
- You have accumulated some money for your retirement. You are going to withdraw $98,624 every year at the end of the year for the next 18 years. How much money have you accumulated for your retirement?
- Shaquil receives total employee benefits that are 13.5% of his gross annual pay. If Shaquil has a gross annual pay of $40,000, how much in total employee benefits does he receive?
- The company you work for will deposit $150 at the end of each month into your retirement fund. Interest is compounded monthly. You plan to retire 25 years from now and estimate that you will
- Suppose you plan to retire at age 70, and you want to be able to withdraw an amount of $6,000 per month beginning with the first month after your 70th birthday until you reach your birthday at age 100
- If partially vested participants in a qualified defined benefit pension plan terminate their employment with the sponsoring employer, how must the plan handle the unvested portion of their benefits? a) Use them to reduce employer contributions for that p
- Ginger Brown has a take-home pay of $700 a week. Her disability insurance coverage replaces 70% of her earnings after a four-week waiting period. What amount would she receive in disability benefits if an illness kept Ginger off work for 16 weeks? Show wo
- Mary retired from her job on January 1 and will recieve monthly pension benefits of $2000 per month. She has contributed to her pension plan over the many years and her basis in the plan is $172800. Her life expectancy based on IRS mortality tables is 18
- Assume that Social Security promises you $40,000 per year starting when you retire 45 years from today (the first $40,000 will get paid 45 years from now). If your discount rate is 7%, compounded annually, and you plan to live for 17 years after retiring
- You have accumulated some money for your retirement. You are going to withdraw $83,102 every year at the beginning of the year for the next 19 years starting from today. How much money have you accumulated for your retirement? Your account pays you 11.67
- You have accumulated some money for your retirement. You are going to withdraw $92,801 every year at the beginning of the year for the next 21 years starting from today. How much money have you accumulated for your retirement? Your account pays you 14.69
- 1. Under a company savings plan, a worker contributes $250 a month to an ordinary annuity paying 6%, compounded monthly. Calculate the annuity's worth in 35 years. 2. You are planning to buy a car in
- You wish to have a retirement nest egg of $5 million in 45 years. If you could earn 7% in a mutual fund, what amount should you deposit each month to achieve your objective?
- In which of the following pension plans are benefits covered by the Pension Benefit Guaranty Corporation (PBGC)? 1) Cash balance pension plans 2) Money purchase pension plans 3) Target benefit pension plans a) 1 only b) 2 only c) 3 only d) 1, 2 & 3
- In which of the following pension plans are benefits covered by the Pension Benefit Guaranty Corporation (PBGC)? 1) Cash balance pension plans 2) Money purchase pension plans 3) Target benefit pension plans a) 1 only b) 2 only c) 3 only d) 1, 2 and 3
- At the end of this month, Bryan will start saving $80 a month for retirement through his company's retirement plan. His employer will contribute an additional $.25 for every $1.00 that Bryan saves. If he is employed by this firm for 25 more years and earn