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How to Collect Your Pension Benefits

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According to the CNN Money website, a pension is a special account maintained by an employer to provide a monetary payout once an employee retires. In 1875, American Express was the first American company to offer its employees a pension plan. Back then, a disabled employee who worked for American Express for 20 years and was at least 60 years of age could receive 50 percent of his salary, up to $500 annually.

Make an appointment with your company's human-resources department. Check with them to make sure you are qualified to receive a pension from the company. CitiBank Online notes that in order to qualify for a pension you have to meet company rules concerning length of employment, retirement age, or some combination of the two.

Apply with your company following their procedures to receive your retirement benefits. Investigate the best option for how to collect your pension benefits. Some companies give their employees the option of receiving their benefits as a lump-sum cash payout or monthly payments. The option you choose will effect how you receive your pension benefits for the rest of your life. There are advantages and disadvantages to both lump sum and monthly payouts. You will have to decide if you want a joint and survivor annuity, so your spouse will continue to collect your pension if you should die first; or single life annuity, with a higher upfront payout, but it will cease upon your death. Notify human resources where you will be living once you are retired.

Apply for Social Security. Social Security is part of all American workers' pension benefits. All workers and their employers pay into the fund over the course of an employee's work life. You can apply for Social Security retirement benefits if you are 61 years and 9 months old or older. You may start collecting a reduced benefit at age 62 or your full benefit at age 65.

Search for other pension benefits due you. If you are divorced, you may be entitled to part of your ex-spouse's work pension and Social Security pension. The Pension Benefit Guaranty Corporation (PBGC) provides a guide for finding a lost pension due to a former employer going out of business.

About the Author

Based in North Carolina, Carol Taber has been writing since 2008. Her work is published on her blog, A Second Cup, and on various other websites. She is currently a features writer for The Wake Weekly and holds a Bachelor of Arts in accounting from the University of New York at Buffalo.

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