Let's assume that an employee is married at retirement and wanted to provide for his or her spouse in the event of the employee's death. The employee was 62 years old at retirement and the employee's spouse was 60. The employee decided upon the "A" 1 / 2 option at the time of retirement.
The employee's pension without reduction for any Survivorship option had been calculated at $17,253.75 per year. A Pension Office employee would then consult actuarial tables for a pensioner aged 62, a spouse aged 60 and "A" 1 / 2 as the option choice. The factor (in this case, .8925) is multiplied by the unreduced pension amount as follows:
This means that the employee would, upon retirement with an "A" 1 / 2 option, receive $15,398.97 per year for life. Upon the employee's death, the employee's spouse would receive one-half of this amount, $7,699.49 per year for the remainder of the spouse's life.
Although this example shows annual amounts, pension checks are paid monthly