Knew I was vested in my pension when I resigned but thought the only option was monthly annuity. Was pleasantly surprised when a package came yesterday (though it says it was prepared November 10 and sent by certified mail) with a lump sum option.
Anyone else received similar and did anyone do a rollover of lump sum to XOM savings plan? If so, how was the experience? Thank you.
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What is the average of your last 3 years salary?
10 years experience, my lump sum option is $250k
Rolling it over to an IRA. Same with XOM savings plan when the stock goes back up a bit. Makes no sense to me to rollover pension to XOM savings plan where you have little control over the investment strategy.
It's basically the same, it is a non taxable event to roll the pension lumpsum into a 401k just as it's a non taxable event to roll the money into an IRA. Once the money is there though, there are a few
differences between an IRA and 401k. The biggest knock against XOM's 401k is the lack of ability to trade when you want (ie. getting the average price of the following day when placing a trade, as well as being limited to 2 trades/mo). Not to mention only having 7 investment options. Consult an advisor that knows what they are talking about there are some pretty complex rules especially around NUA and having the money available when you need it that you need to consider before lumping everything together in the savings plan.
Got the same letter and was pleasantly surprised. Non-retiree here, fake PIP'd in July (mid 30's, but pension vested). Final page in the pension summary plan description has a supplement "non-retirees are eligible to elect the lump sum payment option under limited circumstances. Only non-retirees who terminate employment with the company...under a company-sponsored or company-funded severance program are eligible." Goes on to state that you have to take the lump sum now, no option to defer it to normal retirement age.
Does anyone know what the "special tax treatment" is for rolling the lump sum into the EM Savings Plan? Is it any different than just rolling it into a non-EM IRA? (I've tried calling my case administrator at the benefits center a couple times to ask but it goes to voicemail with a message of "unless it's an emergency, try calling again after this pandemic is over"....ugh)
It depends on if someone is retirement eligible or not. Unless you are being let go, you do not get a lumpsum option until you reach age 55. They only option is to take the annuity at age 65. If you are being let go you get a one time lumpsum option 3 months after your last day on payroll. Benefits will send you a "intent to retire" package with the details. You will want to put the lumpsum (if you choose that option) into either the savings plan or into an IRA. I would pick the IRA because of the limited investment options in the savings plan as well as the restrictions on trading in the savings plan. Those detractors usually out weigh the benefit of the low cost of the savings plan, especially when you can open an account at Schwab or Vanguard and basically replicate the funds in the savings plan if that's what you want. I would suggest talking to a financial professional before trying to undertake any of it your self. Goodluck!
Thanks for the responses. The reason I asked about rolling over to XOM savings plan is that it is tax deferred as well and hopefully the transfer is electronic (calling today so will know). Then going forward I only need to work with ING and not XOM benefits.
By pension lump sum, are you talking about severance ? Or is this separate from severance ?
Place it in some type of retirement account or you get taxed your current rate.
You can go to the benefits site and run the calculator to see what you get.
Correcting last post -
You resigned - and have the option.
Even voluntary, same applies.
Nest egg, though you never know.
It's there.
Lump Sum about to go away.
If offered to involuntary now - take that nugget to an IRA! Good rate in 1Q21.
You can finagle with the IRA if you like, but let it ride until later.
It's not for now.
Just a warning. Regarding 'certified mail'.
They send the lump sum check - made out to your IRA - via standard USPS.
Standard in your home address box.
Usually on a rainy windy day.
Anyone mind sharing what the lump sum if worth if NRE based on years of service and pay?
I hope this lump sum option stays if you leave the company voluntarily before retirement age. Wouldn’t mind investing it myself!
Yes - the rule was changed recently. All let go got the one-time lump-sum option. Will be paid in Feb-21.