Does the pension calculator on fidelity website show the estimated pension based on the new rates with the 13-30% reduction?
12 replies (most recent on top)
NO
Although I left in 2021, all the years past, the pension calculator only showed the interest rates from the current year. So, the rates you see in most cases are the rates you get.
The exceptions are, you leave after one of the cutoff dates, November for Legacy T, or Dec 30th for Legacy SBC.
If you want to see how the interest rates, you will need the IRS minimum present value segment rates. Get the 1st, 2nd, 3rd segments.
https://www.irs.gov/retirement-plans/minimum-present-value-segment-rates
In the Fidelity site, pension estimator, you will need to enter those numbers into the form, there is a spot, it's fairly obvious, once you know what those boxes are for.
That should calculate the pension payouts with the new rates.
In years past, I've seen where the calculator didn't work. Plug in the segment rates, and there would be no change in the lump sum payout. So, be aware, if there is no change, you better not rely upon those numbers, because the calculator isn't working for you!
I’m also 50 w/25 yrs. Got 1 in college and 2 in HS. Hoping to make 5 more years. I’m one of the few, it seems, that have overall enjoyed my time at SWBT, SBC, and ATT. Started as CSR, then splicer, now “Eng”. Have had good and great bosses, and made many good friends.
My pension is good. No need to worry about rates.
https://www.irs.gov/retirement-plans/minimum-present-value-segment-rates
The new segment rates can be found here. They come out every month, but AT&T locks in the November rate for the next year. So, for 2022, we are using the 2021 November rate, which is at an 130 year low, because interest rates have been so low.
For 2023, they will lock in the November 2022 rate for the entire year. So far, we only have the October 2022 numbers, and yes, the drop in value for the Lump Sum is breath taking.
I have 25 years with the company, and if I were to leave 12-30-22, my pension lump sum would be $365k. If I were to leave 1-1-23, it drops to $255k (and that's using the October numbers. I'm sure November's will be even worse) If you take the monthly annuity, that value actually goes up as the interest rates go up, but once you die, that's it. No money to pass down to the next generation.
Definitely call Fidelity and ask them.
I'm only 50, so if I were to leave this year, I'd still have to work another 5 years before I could start drawing my 401k early. I've decided to work here another 5 years and hopefully my pension will add back some of its value by then.
“ When I called Fidelity months ago, they would NOT speculate as to what next years raye would be. The did want want the liability!“
I am continually amazed by the extremely low IQ’s displayed here for all to see on a regular basis.
Of course a Fidelity call center rep is not going to speculate about future interest rates. Do you really think that is something they should be doing? In the unlikely event that they did, do you really think Fidelity would be liable for the Fed changing interest rates?
When I called Fidelity months ago, they would NOT speculate as to what next years raye would be. The did want want the liability!
Use the October rates since we are so close and be shocked at what you might loose if you are L-T. Might be too late now to retire before the end of November. L-SBC is December.
GTFO of Toxic-T any way you can!
I believe for current rates you don't even have to enter the 2021 Nov rates in the boxes, if you leave them blank it defaults to what is current rate. I second what everyone else says, to be sure, call Fidelity.
One other important note, not all pension plans are impacted the same. For example some with plans of legacy companies are not impacted as far as lump sump, but their annuities may go up.
qoute: I think the 20-30% reduction only applies if you take the lump later versus now /quote
Maket that 40% reduction
Call Fidelity and ask for a 'pension expert for AT&T'. This team is the one to talk with.
Call Fidelity for details on your situation. Depends on your timeline and what you want to do. If you want the monthly pension and not a lump, then don't panic. I think the 20-30% reduction only applies if you take the lump later versus now (when interest rates drop again at some point in the future, the lump will start going back up - they are inversely related). If you want to opt for the monthly pension (and not the lump) I think you will see the monthly pension does not go down for you in 2023 and most likely will go up. Bottom line, call Fidelity, get the facts that apply to you.
Yes it will. You need to input the current segment rates from October and specify your off payroll date and pension commencement date and compare it with the default rates which are from 11/30 or 12/30 last year depending which legacy company you work for