Co-op employees traditionally have enjoyed access to well-defined pension plans that allow them to save for retirement while earning an income during their golden years. Co-op retirement plans offer unique value, yet are gradually being phased out from private sector options such as 401(k)s or personal savings accounts. Cooperatives aim to foster sustainability and longevity, so pension plans help foster that value by encouraging long-term financial planning.
Co-ops differ significantly from conventional pension plans in that their democratic decision-making processes involve all members and householders of the co-op as part of its ethos of collective good rather than profit maximization. Members have input in investment decisions, plan management decisions and more; all this fits within the philosophy of their business model that promotes co-operatives as alternative investment vehicles.
Co-op retirement plans stand out due to their multiple employer status. By pooling resources and risk among 900 other rural electric cooperatives nationwide, administrative and investment costs are kept lower than they otherwise would be. Furthermore, NRECA acts as plan sponsor and assumes much of its responsibilities and potential liabilities associated with Cooperative Retirement Plans.
Co-ops can leverage their large membership base to negotiate competitive administration and investment plan fees, as well as offer benefits that may not be offered through traditional pension plans, such as tax deferral on contributions and lifetime income streams upon retirement. Furthermore, co-ops provide their members with competitively priced life insurance through National Rural Electric Cooperative Life Insurance Company.
Cooperatives provide many features and benefits to their members, such as access to affordable mortgage and car financing through affiliated financial services companies. Furthermore, their focus on serving the common good can lead to additional advantages for members – for example some cooperatives are even able to offer access to mortgage and auto financing through affiliated financial service companies.
What steps can I take to rejoin a Coop? Former members can reapply by visiting the Membership Office during office hours and providing proof of identity and address; additionally they must pay any refunded member equity investments of $100 as soon as they reenter. Any adult living within the household also need to present ID and proof of address documents in order to reapply;
All members of a household must participate in the same workslot, and the Coop will be informed if someone leaves without being present during a shift. They will contact the family to assess if this person can stay or if they will be “suspended” from work.