The reduction for each of the first 36 RF is 5/9 of 1%. The reduction for each month
greater than 36 is 5/12 of 1%. The reduction amount is based solely on the number
of months involved.
EXAMPLE: Benefits for a person with a FRA of 67 who retires at age 62 will be reduced for
60 months of early retirement. At age 67 we give them an ARF that is applicable for
25 months. It is not material when those months actually occurred. After the ARF,
a reduction for 35 months applies. The reduction is calculated using 5/9 of 1% for
35 months regardless of when those 35 months occurred.