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If your employer funds your benefits, you usually begin to earn benefits as soon as you become a participant in the plan. A participant is a current or former employee who is, or may be, eligible to receive pension benefits from a plan when they become vested (have worked a sufficient number of years to qualify for a non-forfeitable right to receive some pension benefits). With most jobs, you must be allowed to pay into the pension plan after one year of service (1,000 hours) or age 21, whichever is later. To receive benefits, you must be vested. If you start work at age 18, the vesting process must begin when you are 18, even if you cannot join the plan until you are 21. When you join the employer's plan at age 21, you will already have credit for three years of service toward vesting, because you started work at 18. This is a particularly important rule for women, who often leave the labor force to raise children. You and/or your employer won't be able to start making contributions toward retirement pension benefits until you reach age 21, however. Thus, if you start a job at age 18 and vest at age 23, you will only have a pension based on accruals (i.e., earned funds) from age 21 on. A part-time employee may be excluded from a plan if she works fewer than 1,000 hours per year. It is unnecessary to stay with a particular job for your entire career to receive pension benefits. Rules establish the minimum amount of time you must work for an employer so that a portion, or all, of your employer's contribution to your pension is vested or not forfeited if you leave. Once you are vested, you are entitled to the benefits you have earned even if you leave. When you leave a job, you are always entitled to the money you have personally invested in your employer-sponsored plan. Vesting is done by several different methods and can be complicated and confusing. The following methods of vesting may be used:
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