General Electric began under the direction of inventor Thomas Edison and today is a multi-billion-dollar company with interests in fields across the business spectrum, from health-care systems to energy and propulsion. Retirement benefits for GE's workers allow them to retain their standard of living through pension payments and access to health care that maintains their quality of life.
The Pension Plan
Many GE employees working on a full-time basis are eligible for pension plan benefits upon retirement. The company supports several different varieties of plans, though each essentially boils down to one of two options: a plan reflective of career earnings (better for executives with higher salaries and shorter terms of service) or a plan that factors in years of service and average career earnings (better for long-term employees). The pension plan provides a monthly income to the employee after he retires.
Health and Life Benefits
Life and health insurance benefits are extended to GE employees who retire under the GE Pension Plan with 10 or more years of service. Health insurance benefits provide for routine medical exams, prescription drug coverage, hospital stays and certain kinds of maintenance care. Life insurance consists of a payout amount that is generated upon the policy holder's death. According to General Electric's web site, retirees collectively share in the cost of health-care benefits, thereby reducing the monthly premiums for all of the 250,000 insured by GE health insurance plans.
GE has not made contributions to the GE Pension Plan since 1987. This means all monetary contributions to the GE Pension Plan come directly from the employee's pocket. Plans are funded through employee contributions (usually deducted from their paychecks) and placed in interest-bearing accounts that are usually tied to stocks. This creates a modest return on funds contributed to the plan (8.5% in 2004). Remember that retirees still have to report payments from a pension plan as income, even though it's money they essentially earned some years ago.