Hello after 13 years starting to consider leaving the company. My question is if I left today would I have the option of taking a pension cash out? If so how long would it take to receive? Thanks in advance
30 replies (most recent on top)
@3wuv. Thank you. It worked perfectly.
@1mrc
you must input your benefit start date at lease three months after your resignation date, e.g.
last date worked
12/31/2021
When do you want to begin receiving your checks?
04/2022
This will allow you to have the lump sum option available
good luck!
Re:"The fewer employees linked to a longer term pension plan the better off we will be financially."
No chance the company rolls what it used to set aside for pension into 401k. We won't be better off. The company will. How many of you are actually stockholders? I wouldn't invest in this company.
Post ID @1tlr+1bHOnQ9E is the best post I have seen on this site in weeks.
IF YOU ARE PLANNING to leave, read his post in this thread. It's 100% accurate. The only thing left off.....how do you actually forward the check to Voya??
All lump sum pensions in our plan are taxed at ordinary income levels, so you will take a hit on the tax if you leave and take the lump sum. If youre still focused on the longer term for retirement, you might try and roll it into a 401k (which you have 60 days to do per IRS guidelines)...I just don't actually know how thats done mechanically.
@1zdn+1bHOnQ9E
Depends if you are retirement eligible or not. Suggest check your goto/ocbs
I couldn’t get the pension calculator to generate a lump sum projection for any date other than my normal retirement date. Does this mean it’s not available to me
"Taking the lump sum is a one time option available only in the benefits commencement package they send you within 90 days of separation."
Unless this 'well - run' company screws it up as it did with me. 8 months into a new job with a new company, and when they sent the second offer, it inspired me to accept the lump sum. Why should I trust the contract with my money given all I know?
I’m 62 with 13 years service. Would my pension be discounted if I had to take this option
I resigned last year, cashed out my pension. Got the lump sum about 6 months after my resignation date. They send a physical check, which is easy to forward to Voya to roll into your 401k.
I know several others in similar situations who all took the lump sum. Half a dozen people, with years of service ranging from 8-20. Pension ranged from $70k-475k. It’s a function of years of service, your recent salary, and the discount rates , which are set by the IRS.
https://www.irs.gov/retirement-plans/minimum-present-value-segment-rates
You are eligible whether you resign or are terminated. You are eligible as long as you are vested in the pension (>5 years).
The pension benefit calculator on the benefits web site is accurate. Set your separation date, then set the benefits commencement date to +3 months from then and it will tell you to the penny your lump sum. The only thing that may change are the IRS interest rates, which can swing it a few %.
Taking the lump sum is a one time option available only in the benefits commencement package they send you within 90 days of separation. Call the benefits center immediately on separation and ask them to prepare your BCP and mail it to you. If you don’t take the lump sum in the first BCP window, they don’t have to offer it again. All you will be able to get is an annuity at 65, or a much much smaller annuity earlier than that.
Go to the benefits web pension calculator and see what yours is worth.
Can you please help explain it bit more? At 43, your lump sum was calculated from 43 to 85 (actuarial age), discounted by treasury rate equivalent to get lump sum at age 43. Then penalized by 88% so ?
Has anyone seen the table for the discounted lump sum based on age? I have seen it for the monthly pension payout, but not the lump sum. Is it the same? That was my assumption.
If you are let’s say 63, can you defer your lump sum payment until 65 so you can receive 100%?
@1szy+1bHOnQ9E
The early lump sum discounted cash flow calculation starts at the benefit commencement date, not 60 years old. Of course there is a hefty penalty the younger you are. I think mine was 12% (as in I only was credited with 12% of my cash flow) and I was 43 when I took mine.
How is it calculated? Is there a PENALTY for early pension cash out? Or is it just plain discount rate without any PENALTY?
FYI = EVERYONE after 3 years gets to cash out their pension now. The policy was updated in the middle of COVID and no longer requires the 15 year vesting option. Those in the 8-20 year range should consider this before leaving. You dont have to wait until age 55.
Former employees have been contacted by ExxonMobil about cashing out. A former co-worker that left the Company after being vested was contacted via regular mail. She thought it was odd but, contacted the Benefits department and the letter was legit. What’s that about?
ExxonMobil will eventually grandfather the traditional pension for the longer term goal of offering a 401K plan only. The reason the corporation wants to offer a one-time lump sum pension to those less than 55 years old and less than 15 years of service is to accelerate the grandfathering of the traditional pension.
The fewer employees linked to a longer term pension plan the better off we will be financially.
Yes you can cash out, but you will get lot less than you can if you stay. For example: if you are 15 years of experience and say make $200K for last three years and are age 40. If you leave today, Your pension at age 60 would be 2000.01615 = 48K annuity. Life expectancy is 85, so you’ll get 48K from 60 to 85 on annual basis. At 4 % discount rate that would be = $750K
Here is the catch, if you leave on your own, you do not have a lump sum option unless you are retirement eligible. You will only get the annuity starting age 65. If you are PIP’ed as in you are leaving outside your choice, you get the lump sum option.
Catch 2: you won’t get $750K. Because that’s what is owed to you at age 60. So it will be further discounted to your current age, say 40. So $750K becomes $340K discounted at 4%.
Catch 3: penalty for early withdrawal. At age 40 could be 50%. So you end up getting $170K as cash payout, for which you will pay taxes. Post tax would be $140K.
If you stayed with Exxon, even without pay rise your pension at 60, with 35 years of service would be 350.016200= 112K , lump sum 1.7 Million - 10 times more tab $140K. Now you can invest your 140k in Crypto and it can grow to 1.4M in 20 years, I won’t argue with you on that ..
Pension is designed to promote long term employment, so it’s working as designed.
Exxon is one of the very very few that gives both 401K Match and a pension. In addition, Pension is on base salary, which unlike other companies is quite high for Exxon (I would always take higher base salary over smaller base with variable bonus )
401K match is to keep you employed today, pension is to keep you employed tomorrow.
Hope it is useful to those who are on fence. What exxon has is pretty hard to match elsewhere. Grass ain’t greener elsewhere ! But life is a journey so take a wise decision one way or other
Going to excel now to model scenarios
Be aware that the closer you are to retirement, the more SPP you are leaving on the table that you cannot get in cash.
Wow. The pension was keeping me here but this is groundbreaking news. Considering salaries flatten out late in career if I can cash out why would I stay?
I received two packets after involuntary termination. One with outdated info about needing 15+ years of service to qualify for lump sum. Then an updated packet stating I only needed 5 years of service to qualify.
Luckily I called the number in the packet after I got the 1st one just to confirm whether or not I qualified (even though It seemed like I did not). They told me I did and to disregard the info they sent me in the 1st one.
Filled everything out and got my money 4 months after last day on payroll. I agree with advice that you need to stay on top of it and keep calling them to make sure everything is good to go.
I just read the Pension SPD and it says lump sum is only offered to retirees, not terminees. So if I quit, HR "may not" offer the lump sum?
@lzo+1bHOnQ9E
VERY important correction, the early pension lump sum is available FOR 90 days after your last day on payroll. If you don't elect to take it within that window, you loose the lump sum option forever. That is why you need to stay on HR's ar-e about receiving your packet. I was hounding them weekly, and my packet showed up with 6 days remaining to get the lump sum.
You folks just made my day with this.
Goto/earlypension
Cash out is available 90 days after leaving.
Where is the pension estimator calculator at?
The policy changed sometime in the last couple years. Everybody can get a cash out when they leave, and there’s a calculator you can use to determine how much it is
You can take a pension lump sum. Check the estimator and put Jan. 2022 as your payment date and sometime this year as your last date employed. Check all payment options and the lump sum amount should be there.
You cannot take a cash out unless the company offers it to you. I’ve had a few friends that have left (less than 10 years service) that were offered a cash out at a later date. If you read the summary plan description of company benefits pertaining to the pension, you cannot take the lump sum unless you you have 15 years with the company and retirement status (55 years of age or older… or maybe it’s 50.. I forget).
Best of luck, OP. Hope they offer it to you.
I believe you can cash it out. The company is allowing people leaving an option to cash out to promote attrition, though you may want to check and validate.