§ 26101 Actuarial Benefit Equivalency

• •This law is about making sure two different benefits are equal in value, even if they look different.
• •The value is calculated using special numbers (interest rates and mortality tables) chosen by experts.
• •If you switch from one benefit to another, the new one should be worth the same as the old one.

Imagine you have a pension that pays you $1,000 every month for life. Your company offers you a one-time payment of $150,000 instead.

The law says the $150,000 should be worth the same as the $1,000 monthly payments. Experts use math to make sure it’s fair.