Defined Contribution

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The Defined Contribution Plan, administered by Principal, is another savings tool to prepare you for retirement. While your pension plan promises a stable steady monthly income, this account has room for growth. Your individual account grows with contributions and earnings from investments, and is another layer of financial security as you get older.

You’re eligible to participate if your employer is required by a collective bargaining agreement, or another written agreement, to contribute to the Defined Contribution Plan.

How it works

The Defined Contribution Plan is a 401(k) Plan. Your employer contributes to your account for each hour you work in covered employment. You’re also allowed to contribute to your account on a pretax basis, lowering your taxable income. The Internal Revenue Service sets the maximum you’re allowed to contribute each year. For 2022, that amount is $20,500 (or $27,000 if you’re age 55 or older).

Then, you can select how your account is invested from the plan’s available investment options based on your goals and how you feel about risk. If you decide not to pick how your account is invested, you understand that your account will be invested in the plan’s default investment option until you make a new investment selection. The plan’s default option is a target date fund series where the investment strategy is designed to manage risk based on how close you are to normal retirement age.

Contact Principal at 800-986-3343 with questions about your account. To view your funds, review investment options under the plan, change your investment selections, or review your statements, go to the Principal website and log in.

Withdrawing funds

You can withdraw the funds in your account if any of the following apply:

  • You’re at least age 55 and you have retired.
  • You are any age and there have been no contributions to your account for 3 consecutive plan years.
  • You become totally and permanently disabled.

You’re required to withdraw the funds in your account beginning on April 1 following the year in which you turn age 72.

Payment options

The way you receive your annuity depends on whether you’re single or legally married. The default option if you’re married is the 50% Joint and Survivor Annuity, but you can also elect a 75% Joint and Survivor Annuity. Both options provide your spouse with an annuity after your death. You can waive the joint and survivor options even if you’re married, but your spouse must consent in writing.

If you’re single, the default option is the Life Annuity, which gives you equal monthly payments during your lifetime. You can also choose a lump-sum payment of your account balance or a combination of both options. Make sure to designate a beneficiary to your annuity so the Fund Office knows where to send payments in the event of your death.


You’re immediately vested in all contributions to the Defined Contribution Plan. That means you have a non-forfeitable right to the money in your account.

Applying for benefits

You must file an application form with the Fund Office.