Top Pension Questions for Becton Dickinson Employees
These are the most frequently asked questions for Becton Dickinson employees from our weekly webinars.
Question 1:
How do the cash balance benefits differ for associates hired before and after April 1, 2007, under the Becton Dickinson and Company Retirement Plan?
Answer:
Cash Balance Benefits Differences: At Becton Dickinson and Company, the calculation of cash balance benefits varies based on the associate's hiring date relative to April 1, 2007. Associates hired before this date were initially part of the Final Average Pay Pension Plan and could choose to convert to the Cash Balance Plan—a decision known as "Pension Choice." Those who did not convert by 2007 had their plans automatically adjusted in 2013 ("Pension Change"). Associates hired on or after April 1, 2007, were directly enrolled in the Cash Balance Plan. This distinction affects calculations at retirement, helping to maintain the values for those with a prior Final Average Pay benefit during the conversion
Question 2:
What steps should employees follow to access and understand the summary plan description (SPD) and official plan documents relating to their pension benefits at Becton Dickinson and Company?
Answer:
Accessing Plan Documents: Employees seeking information about their pension benefits at Becton Dickinson and Company should consult the Summary Plan Description (SPD) and the official plan documents. These resources provide detailed and compliant information about retirement plans and are accessible through the Benefits Direct portal or by contacting the Benefits Direct helpline directly.
Question 3:
Could you elaborate on how the “Rule of 85” operates at Becton Dickinson and Company and its significance for employees planning for early retirement?
Answer:
The Rule of 85: The "Rule of 85" is an early retirement benefit that applies to associates where the sum of their age and service years equals or exceeds 85. This rule allows for the retirement benefit to start before the age of 65 without reduction, applicable only to those covered by the Final Average Pay benefit, including those who converted to the Cash Balance Plan under "Pension Choice" or "Pension Change." The calculation maintains the value of the early retirement subsidy within the cash balance setup.
Question 4:
Can you explain how employees can estimate their retirement income using the tools and resources available through Becton Dickinson and Company?
Answer:
Estimating Retirement Income: Becton Dickinson and Company offers tools such as the Benefits Direct platform, where employees can estimate their retirement income by selecting potential termination and benefit start dates. This system enables planning by providing estimates based on the individual’s specific retirement scenario.
Question 5:
In the event of changes to the retirement plan or its termination, how does Becton Dickinson and Company maintain the accrued benefits of its employees?
Answer:
Maintenance of Accrued Benefits: If there are any changes or termination of the retirement plan at Becton Dickinson and Company, the accrued benefits of the employees are kept in accordance with legal requirements. The plan’s terms may be amended, but the accrued rights to benefits remain preserved.
Question 6:
What are the differences in the benefit calculations for “Pension Choice” and “Pension Change” associates at Becton Dickinson and Company?
Answer:
Pension Choice vs. Pension Change Calculations: For "Pension Choice" and "Pension Change" associates, the benefit calculation at retirement involves maintaining or enhancing the value of the Final Average Pay benefit as it is converted to the Cash Balance benefit. This affects their retirement outcomes based on the values retained or increased.
Question 7:
How do employees at Becton Dickinson and Company make informed decisions regarding the conversion from traditional Final Average Pay benefits to Cash Balance benefits?
Answer:
Conversion Decision Process: The process for converting from Final Average Pay benefits to Cash Balance benefits involves understanding the long-term impacts on retirement benefits. Associates need to evaluate how the conversion affects their retirement finances, considering factors like benefit retention and potential growth in the Cash Balance plan.
Question 8:
What role do early retirement subsidies play in determining the pension benefit for associates at Becton Dickinson and Company, and how do they interact with the Cash Balance Plan?
Answer:
Early Retirement Subsidies: Early retirement subsidies, such as the "Rule of 85," play a significant role in determining pension benefits for associates who meet specific criteria. These subsidies can increase the overall benefits received at retirement, making them a critical factor in retirement planning for those eligible under the old Final Average Pay or the converted Cash Balance Plan.
Question 9:
How should employees of Becton Dickinson and Company navigate the complexities of rehiring policies in relation to their retirement benefits?
Answer:
Navigating Rehiring Policies: Rehired employees at Becton Dickinson and Company must understand how rehiring affects their pension benefits. Those rehired after April 1, 2007, with prior vested benefits from the traditional plan, will have their benefits calculated cumulatively under both the Final Average Pay and the Cash Balance plans, impacting their total pension upon retirement.
Question 10:
How can employees contact Becton Dickinson and Company to learn more about their pension plan and related retirement benefits?
Answer:
Contacting for More Information: Employees can learn more about their pension plan and retirement benefits by accessing the Benefits Direct website or calling the Benefits Direct toll-free number. These channels provide direct access to detailed plan information and support for any questions related to retirement planning at Becton Dickinson and Company.
Question 11:
How does the Becton Dickinson and Company defined benefit plan differ from the cash balance plan in terms of eligibility and benefit calculation?
Answer:
Defined Benefit vs. Cash Balance Plan: The Becton Dickinson and Company defined benefit plan and cash balance plan differ significantly in terms of eligibility and benefit calculations. The defined benefit plan calculates benefits based on the employee's final average pay, age, and years of service. In contrast, the cash balance plan, introduced in 2007, provides a hypothetical account balance that grows with defined pay and interest credits. New hires after January 1, 2018, cannot join either plan, reflecting a closure to new entrants.
Question 12:
In what ways are pension benefits and service calculated under the Becton Dickinson and Company BD Retirement Plan?
Answer:
Pension Benefits Calculation: Under the BD Retirement Plan, pension benefits are calculated based on 'Total Compensation,' which includes various forms of income like base salary, bonuses, and other regular compensations. Vesting in the plan occurs after five years of service, granting employees rights to benefits.
Question 13:
What specific maximum benefit limits should employees at Becton Dickinson and Company be aware of regarding their retirement plans and how do these limits adapt annually?
Answer:
Maximum Benefit Limits: Employees should be aware of IRS-imposed limits on contributions and benefits under retirement plans. For 2018, the compensation limit for pension calculations was $275,000, adjusted annually for inflation. Staying informed about these adjustments is essential for retirement planning.
Question 14:
How can Becton Dickinson and Company employees address discrepancies in their benefit calculations or if they believe they have been wrongfully denied benefits?
Answer:
Addressing Discrepancies or Denial of Benefits: Employees should contact the Plan Administrator to correct any issues with benefit calculations. The process includes filing claims and understanding rights to appeal under ERISA, helping employees to navigate these situations effectively.
Question 15:
What roles do the Plan Administrative Committee and the Investment Committee play in managing the BD Retirement Plan of Becton Dickinson and Company, and how can employees get involved or seek clarification on their plans?
Answer:
Role of Committees in Managing the Retirement Plan: The Plan Administrative Committee manages the plan's administration, while the Investment Committee oversees asset investment. Employees can attend committee meetings or contact them directly for inquiries.
Question 16:
How does the early retirement benefit impact employees at Becton Dickinson and Company, particularly in terms of eligibility and the calculation of reduced benefits?
Answer:
Impact of Early Retirement: Early retirement is allowed from age 55 with at least 10 years of service, with benefits reduced accordingly. This structure helps employees make informed decisions about retirement timing.
Question 17:
What steps should employees of Becton Dickinson and Company take to keep their retirement benefits accurate and up-to-date, especially after a change in personal circumstances?
Answer:
Keeping Benefits Accurate: Employees should update HR with any changes in marital status, address, etc., and regularly review retirement plan statements to ensure their benefits reflect current personal details.
Question 18:
What alternatives exist for Becton Dickinson and Company employees who are not eligible for the BD Retirement Plan, and how can they plan for retirement adequately?
Answer:
Alternatives for Non-Eligible Employees: Those not eligible for the BD Retirement Plan may explore options like IRAs or the BD 401(k) Plan to build retirement savings despite ineligibility for the traditional pension plans.
Question 19:
In the context of the Becton Dickinson and Company BD Retirement Plan, how are survivors' pensions determined, and what options are available for employees regarding beneficiaries?
Answer:
Determining Survivors' Pensions: The survivor's pension provides a monthly benefit, generally 50% of the employee’s pension, to the spouse for life. Designating beneficiaries is essential to maintaining financial provisions for loved ones.
Question 20:
How does Becton Dickinson and Company adapt its retirement plan to current economic realities and regulatory changes?
Answer:
Adaptability and Communication of Plan Changes: Becton Dickinson and Company periodically reviews and amends the plan, updating employees through comprehensive summary plan descriptions to promote understanding of any changes.
Question 21:
In what ways does the cash balance account structure within the Becton Dickinson and Company Retirement Plan benefit employees compared to traditional pension plans?
Answer:
Benefits of Cash Balance Plan Structure: The cash balance plan provides a hypothetical account balance that grows through contributions and interest credits, offering steady growth and benefit portability.
Question 22:
How can employees at Becton Dickinson and Company effectively enhance their retirement benefits through the Cash Balance Plan?
Answer: Enhancing Retirement Benefits: Employees can strategically plan retirement timing to benefit from accrued benefits and leverage annual interest credits, increasing account balances in the cash balance plan.
Question 23:
For employees who are considering early retirement at Becton Dickinson and Company, what options and implications should they be aware of regarding their Cash Balance Account?
Answer:
Implications of Early Retirement: Employees considering early retirement should weigh access to funds with potential reductions in lifetime benefits, understanding the long-term impact on their financial future.
Question 24:
What are the vesting requirements for employees participating in Becton Dickinson and Company’s Cash Balance Plan, and how do these requirements influence overall retirement planning?
Answer:
Vesting Requirements and Retirement Planning: Employees must complete three years of service to vest in benefits, which impacts their retirement strategy. Meeting this minimum is important for securing accrued benefits.
Question 25:
Regarding Becton Dickinson and Company's plan administration, how is transparency maintained in communicating the status and performance of employees' cash balance accounts?
Answer:
Transparency and Tracking Retirement Benefits: Employees access account information through portals and regular updates, enabling them to monitor benefit accrual and retirement plan performance.
Question 26:
What resources does Becton Dickinson and Company provide for employees who have questions or concerns about their retirement plans?
Answer:
Resources for Addressing Concerns About Retirement Plans: Employees have access to HR representatives, plan administrators, summary plan descriptions, and other support to navigate complex retirement benefits.
Question 27:
How does the conversion from a Final Average Pay Plan to a Cash Balance Plan at Becton Dickinson and Company affect long-term employees' retirement benefits?
Answer:
Impact of Transitioning from Final Average Pay to Cash Balance Plan: Employees may see changes in benefit calculation methods and should review their benefits to assess the impact on retirement planning.
Question 28:
For employees who experience a change in their employment status, such as termination or re-employment, what are the implications on their Cash Balance Account within Becton Dickinson and Company's retirement plan?
Answer:
Employment Status Changes and Retirement Benefits: Becton Dickinson and Company outlines the impact and protections under various scenarios, so employees retain access to benefits during employment changes.
Question 29:
How can employees at Becton Dickinson and Company stay informed about legislative updates or IRS changes that could affect their retirement savings?
Answer:
Staying Informed About Legislative and IRS Changes: Becton Dickinson and Company provides resources and updates to help employees understand legislative changes and stay proactive in retirement planning.
Question 30:
What are the key investment objectives that the Trustees of Becton Dickinson UK Ltd consider in managing the pension scheme, and how do these objectives align with the long-term stability of the scheme?
Answer:
Investment Objectives: The Trustees aim for consistent returns, managing risks to funding levels and diversifying assets, promoting scheme stability amid economic fluctuations.
Question 31:
In what ways does the investment strategy of Becton Dickinson UK Ltd incorporate environmental, social, and governance (ESG) factors?
Answer:
Incorporation of ESG Factors: ESG considerations are included to address regulatory, political, and environmental risks, supporting sustainable pension scheme performance.
Question 32:
How does Becton Dickinson UK Ltd's liability-driven investment (LDI) mandate help handle interest rate and inflation risks for scheme beneficiaries?
Answer:
Liability-Driven Investment Mandate: The strategy limits exposure to interest rate and inflation risks, stabilizing the fund’s position across economic scenarios.
Question 33:
What are the day-to-day management practices employed by the Trustees of Becton Dickinson UK Ltd to monitor investment manager performance?
Answer:
Management Practices and Performance Monitoring: Trustees delegate to professional managers, regularly assessing adherence to guidelines, benchmarks, and risk parameters.
Question 34:
How do the Trustees of Becton Dickinson UK Ltd adjust their investment strategy in response to economic or regulatory changes?
Answer:
Adjustments in Strategy for Economic or Regulatory Changes: Trustees revise risk profiles and consult advisers to support scheme growth and compliance with pension legislation.
Question 35:
How do the mechanisms for rebalancing the investment portfolio work at Becton Dickinson UK Ltd, particularly during periods of cash flow surpluses or deficits?
Answer:
Rebalancing the Investment Portfolio: Strategic reallocation during surpluses or deficits keeps investments aligned with long-term goals, maintaining the scheme's financial health.
Question 36:
What measures has Becton Dickinson UK Ltd established to manage risks such as concentration and liquidity risks within the pension scheme?
Answer:
Risk Management Measures: Trustees use diversification and strategic asset allocation to balance growth and minimize risks, supporting a robust investment portfolio.
Question 37:
How can Becton Dickinson employees learn more about the pension scheme?
Answer:
Contact Procedures for Pension Information: Employees can use established contact methods to access pension benefits and investment information, promoting transparency and informed planning.
Question 38:
What role does the investment consultant play in the decision-making processes of the Trustees at Becton Dickinson UK Ltd?
Answer:
Role of the Investment Consultant: Consultants provide valuable assessments to help Trustees evaluate investment managers and maintain alignment with strategic goals.
Question 39:
How do the Trustees of Becton Dickinson UK Ltd plan to address member concerns regarding investment restrictions based on personal beliefs or values?
Answer:
Addressing Member Concerns and Investment Restrictions: Trustees balance member preferences with the scheme’s objectives, integrating ethical considerations without altering investment strategy.
Question 40:
What are the key considerations for employees at Becton Dickinson and Company when making long-term retirement decisions?
Answer:
Key Considerations for Retirement Planning: Employees should consider vesting, benefit analysis, and retirement timing to improve outcomes and maintain financial stability.