Helping employees stretch their retirement dollars

Under a provision of the Deficit Reduction Act of 1984, employees who participate in qualified defined contribution pension programs can increase retirement income by spreading out the installments over an annually redetermined life expectancy. The provision also enables employees to withdraw more than the minimum required distribution during periods of inflation and to continue receiving payments beyond age 100. In most cases, the change in distribution will provide payments throughout the participant's lifetime and a small balance for the participant's estate--rather than a fixed number of mandatory withdrawals spread over a shorter period.