The board of trustees of the DGA-Producer Pension and Health Plans have voted unanimously to allow participants to take up to $20,000 in loans against their Supplemental Benefit Plan’s retirement funds “to assist participants experiencing financial hardship during the unprecedented work stoppage during the COVID-19 crisis.”
Loan amounts, which are limited to the lesser of $20,000, or 20% of a participant’s account balance, will be permitted only from the vested portion of a participant’s account balance, officials said. The loans will be made available from May 1-July 31, and the minimum loan amount is $1,000.
Before applying, however, the trustees are urging participants “to seek alternative means of support in order to preserve your retirement funds to the extent possible and ensure the availability of adequate financial resources during your later years. Other options may include bank loans or other emergency resources, including those provided by the various relief funds available to entertainment industry workers, such as the DGA Foundation in association with the Motion Picture Television Fund.”
Interest rates are set at prime plus 1% for the life of the loan, and up to two outstanding loans will be allowed during the loan availability period.
“Loan repayments must be made quarterly, beginning with the first full quarter following the quarter in which the loan is distributed,” the Plans said. “Loan must be fully repaid within five years, and can be repaid in full at any time without penalty. For married participants, spousal consent will be required for loans of $5,000 or more.”
In another move to provide relief to members left unemployed by the COVID-19 shutdown, the Plans announced Monday that they are eliminating premiums for three months on COBRA health insurance coverage for participants whose coverage expires June 30. COBRA allows eligible employees who have lost their jobs to continue receiving health benefits.
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