Dictionary of Benefit & Investment Terms

An MMBB joint and survivor retirement annuity option that provides a monthly income amount, and continues to pay the same amount to either the member or his or her joint annuitant regardless of who dies first.

An MMBB joint and survivor retirement annuity option that provides a monthly income amount, and if the member’s joint annuitant dies first continues to pay that same amount to the member. If the member dies first, this annuity pays 60% of that amount to the member’s joint annuitant.

The form sent both to members who have received a benefit plan distribution and to the Internal Revenue Service in January of each year showing the gross annuity for the preceding year and the taxable amount.

A guarantee that if the annuitant dies (or both annuitants die) before all guaranteed payments are made, the designated beneficiary or estate will receive payments for the rest of the 10-year certain period. With the guarantee, payments are reduced by a percentage based on the participant’s age when benefits begin (and, for a joint benefit, on the age of the spouse or other joint annuitant). At MMBB, the beneficiary or estate may receive a single sum benefit equal to the present value of the payments for the rest of the 10-year certain period. This guarantee applies to all MMBB annuities unless the member chooses otherwise.

A fee charged for marketing and distributing mutual funds. This fee does not apply to MMBB funds.

An assumption that results in new MMBB annuities being paid in larger amounts than they otherwise would have been, because they have 4% annual earnings built in. At the close of each 12-month-period ending September 30, the difference between the 4% advance earnings assumption and the actual investment experience of the Annuity Fund during the year becomes part of the calculation of the annuity payout value for the following year. For example, if investments of the Annuity Fund earned 10%, the annuitant would receive a 6% increase in his or her annuity the following year (10% actual earnings minus the 4% assumption); if the Annuity Fund earned 3%, the annuity would drop 1% (3% actual earnings minus the 4% assumption). A slight adjustment may also be made based on the mortality experience of Annuity Fund participants.

A defined contribution plan that allows employees to elect to have before-tax contributions made on their behalf to the plan rather than receiving that amount as compensation in their paychecks. An employer may contribute to a 401(k) plan; in many such plans, employer contributions are matching contributions tied to the amount employees contribute. Some 401(k) plans also allow after-tax contributions by employees. These plans are named for Section 401(k) of the Internal Revenue Code, which makes this type of tax-advantaged savings possible.

This is an employee’s maximum salary deferral contributions for a calendar year, as indexed for that year. The limit includes all such contributions from all employers to his or her accounts in 403(b) plans, 401(k) plans, SIMPLE plans and simplified employee pension (SEP) plans. Employees who are age 50 or older may be able to contribute more. Employees with 15 or more years of service may also be able to contribute more, up to a lifetime limit on these increases. See www.irs.gov.

A defined contribution plan available to certain charitable and educational institutions, which may feature employee contributions, employer contributions or both. A 403(b) plan may give employees an opportunity to have before-tax contributions made on their behalf to the plan rather than receiving that amount as compensation in their paychecks. Employees do so by completing a salary reduction agreement. Some 403(b) plans also allow after-tax contributions by employees. This plan is named for Section 403(b) of the Internal Revenue Code, which makes this type of tax-advantaged savings possible. At MMBB, the RP, TAS and TDA plans are all 403(b) plans.

The maximum dollar amount of employer and employee contributions that can be made to retirement plans, including 403(b) plans under IRS Code Section 415©. See www.irs.gov.