Frequently Asked Questions:

Here are some of the most frequently asked questions about the Co-op Retirement Plan.  The answers given are general and illustrative, and if any misunderstanding arises between the information contained in this Q&A section and the official Plan document, the language of the Plan document will prevail.  If you don’t find your particular question here, please contact United Benefits Group by clicking on the “Contact Us” button.

 Looking for guidance on the often confusing topic of Re-Hired Retirees? Click  Here to read United Benefits Group's analysis of this issue.

1. WHY DO I HAVE TO PARTICIPATE IN THE PLAN ONCE I BECOME ELIGIBLE?

Federal pension law requires broad, non-discriminatory participation in a pension plan.  All pension plans must pass certain tests to demonstrate their compliance.  In a multiple-employer plan like the Co-op Retirement Plan these tests are conducted on an employer-by-employer basis, and if any employer fails the test the entire plan could be disqualified. In reality, it’s more than likely that some of the Plan’s smaller employers would fail the test in any given year.  The only way for the Co-op Retirement Plan to guarantee compliance with the law without complex and costly testing is to require the participation of all eligible employees. 

2. WHY WAS THE BENEFIT ACCRUAL RATE OF THE PLAN LOWERED TO 1.25% IN OCTOBER, 2003?

Pension plans experienced a “perfect storm” in the early years of this decade – a combination of falling interest rates and falling stock prices.  The effect on defined-benefit plans was dramatic as employers were suddenly forced into a position of making huge contributions to their plans.  Even a well-funded plan like the Co-op Retirement Plan faced the prospect of employer contribution rates that would have been backbreaking for our Participating Employers.  In order to reduce the employer contribution to manageable levels, the Retirement Committee adopted a dual strategy of decreasing the Plan’s benefit accrual rate from 1.75% to 1.25% for all service after October 1, 2003 and increasing the employee contribution rate to 3.0% of the Wage Base.  It is not known at this time whether these changes will be permanent or temporary.

3. HOW CAN I CHANGE MY ADDRESS?

For your protection we cannot accept an address change without your signature.  Please send your written, signed address change to United Benefits Group, P. O. Box 169005, Kansas City, MO 64116, or fax it to 816-459-8750.  You can also Click Here to download a change of address form.

4. HOW CAN I CHANGE MY BENEFICIARY?

If you need to change your beneficiary please call the Plan office toll-free at 800-816-5535 and we’ll send you a “Beneficiary Designation” form.  This form is designed to help you select a beneficiary within the requirements of federal pension regulations.  You can also Click Here to download a Beneficiary Designation form

5. I DIDN’T GET MY RETIREMENT CHECK, WHAT DO I DO?

Monthly retirement checks are mailed from our trustee bank at the same time each month.   If you do not receive your check by the 10^th day of the month we can stop payment on the check and have it re-issued.  If the 10^th of the month arrives and you still do not have your check, please call our office toll-free at 800-816-5535.  As always, we recommend that you have your check directly deposited to your bank account to avoid the irregularities of ground mail service.

6. I’VE SUBMITTED MY RETIREMENT APPLICATION, WHEN WILL I GET MY CHECK?

Your first retirement check is an “off-system” check that will arrive in your mailbox (or your bank account if you selected Direct Deposit) 3 to 10 days after the first of the month corresponding to your retirement date if your application was received on a timely basis.  After that, your bank account should be credited on the first working day of each month if you selected Direct Deposit.  If your check is being mailed to your home it should arrive around the first day of the month, although mail service in some parts of the Great Plains might be slower.

7. HOW DOES A DEFINED-BENEFIT PLAN DIFFER FROM A 401(K) PLAN?

A defined-benefit plan like the Co-op Retirement Plan is a traditional type of pension plan where benefits are based on wages and service.  Here are some major ways that it differs from a 401(k) plan:

·         You receive a lifetime monthly benefit from a defined-benefit plan, a benefit you can never outlive.  In a 401(k) plan you have a dollar balance which might be depleted before your death.

·         The benefit you receive in a defined-benefit plan is not dependent on investment performance.  You will receive the benefit promised by the Plan’s formula regardless of the volatility of the financial markets.  In a 401(k) plan your account balance is directly affected by the ups and downs of the investments you have chosen.

·         The assets of a defined-benefit plan are professionally managed for the benefit of all participants.  In a 401(k) plan you must make your own investment decisions.

·         Your benefit in a defined-benefit plan is safeguarded (within limits) by the Pension Benefit Guaranty Corporation, a federal agency that insures pension plans.  No similar protection exists for a 401(k) plan.

8. IS MY BENEFIT GUARANTEED?

Your employer makes a promise to pay you the benefit you have earned under the plan’s formulas and provisions.  Because of the multiple-employer nature of the Plan it is unlikely that the Plan will experience an inability to fulfill this promise due to a Plan-wide termination. However, if for any reason the Plan were to terminate without sufficient funds to pay the benefits owed to all participants, the Plan would be taken over by the Pension Benefit Guaranty Corporation (PBGC), the federal agency that insures defined-benefit pension plans.  The PBGC insures the benefits of plan participants within certain rules and limits.  For more information about the PBGC, please visit their website at pbgc.gov.

9. IS THIS PLAN ASSOCIATED WITH FARMLAND INDUSTRIES?

The Co-op Retirement Plan was originally known as “Farmland’s Employee Retirement Plan,” and included both the employees of Farmland Industries and local cooperatives.

In 1986 Farmland Industries spun their employees into a new plan, at which time the original plan was re-named the “Co-op Retirement Plan.”  Farmland Industries continued to be the sponsor of the Co-op Retirement Plan until it filed for bankruptcy in 2002.  At that time the Retirement Committee and the Farmland Board of Directors moved the sponsorship of the Plan to a new non-profit corporation called United Benefits Group.

Consequently, the Co-op Retirement Plan no longer has any association with Farmland Industries or any of its former subsidiaries.

10. CAN I WORK FOR MY EMPLOYER AFTER I RETIRE?

This is a complex issue.  Without going into great detail, you should not retire if you have intentions of returning to work.  If the facts and circumstances of your case suggest that your retirement was not valid, the Retirement Committee will be obligated to stop your benefits and demand repayment of amounts already received.  However, if you retired with no intention to return to work, and a subsequent change in circumstances makes it desirable or necessary for you to return to work with a Participating Employer, it can be permissible.  For a detailed explanation of this subject, click on the “News of Interest” button, then click on “Rehired Retiree Explained.”

There are, however, special exemptions for those who have reached the Plan’s Normal Retirement Age, which for most participants is age 65.  Read the story “Rehired Retiree Explained” for more details.

11. CAN I INCREASE MY PERSONAL CONTRIBUTIONS?

No, and you really don’t want to, either.  Your benefit is based solely on your wages and service, and not on the amount you contribute to the Plan.

12. HOW MUCH DOES MY EMPLOYER CONTRIBUTE TO THE PLAN ON MY BEHALF?

In reality, your employer does not make contributions specifically for you.  Rather, all Participating Employers contribute an amount necessary to keep the Plan well-funded, and those contributions are made on behalf of all participants.  In other words, the employer contributions go into a giant pot for everyone.  Benefits are based solely on  wages and service, not on amounts contributed.  It is the responsibility of the Participating Employers to make sure that the Plan has adequate funds to pay the promised benefits of all participants when they reach retirement age.

13. WHAT IS UNITED BENEFITS GROUP?

United Benefits Group is the non-profit corporation established by the Co-op Retirement Plan Committee to sponsor and administer the Co-op Retirement Plan.  It is governed by a five-person Board of Directors whose members are elected to rotating five-year terms by the Participating Employers of the Plan.