Another great advantage to the lump sum is being able to manage/customize annual income and taxes. Who has converted their lump sum to a Roth IRA? What steps were involved? What is the final tax impact??
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This site is only for the "common folk who were tossed up? What a loser self-deprecatory comment. I guess I don't belong either. And no, -Vett, $7000 or so is not that far-fetched for a monthly annuity for someone in the higher PSG's and bonuses, not the 1-2%, like you claim. What kind of $hit are you smoking out on your platform? I wish I could get some, I'm tellin' ya! I didn't know that they let you bust up out there.
@OrCSQGR-Vett, It should be fairly cut and dried where your PSG and CIP bonuses put you in the range of pension annuity and lump sum payout values, and those , you say, don't agree with the ranges posted on this thread. I sincerely apologize if you are being truthful and you are honestly astounded at the amounts that your coworkers earn. If you doubt this, do some more research, how hard could that be? There was no intent to offend anyone.
@Vvwe, The vast number of readers on this thread KNOW what's truthful and what's not. Just because you insist pushing that a J&S $7200 annuity is pretty common for a retiree at Chevron doesn't hold water. That amount is possible only for the 1-2% of the very highly paid retirees. I don't think these types of former employees come to this site to read about the common folk who were tossed. So stop with your crap. No one is buying it.
Vcxn, again, I would apologize if you were being truthful. But I truly know now that you are full of BS and I haven't offended anyone. There's no way that the fake number that is so incredibly low for your annuity is real (lower than average Social security for professionals) or that you are sincere unless you have only been working 5 or 10 years. You are on here strictly to provoke others and get the last word in. Thanks for letting everyone know that you are a pathetic troll with nothing worthwhile do do with your life.
@Ujms, If you are the poster who has a $2250 or so annuity I am sorry if you were offended. But there are a few things that you have to understand, son. Your annuity is below average, which is why you may feel slighted by a person who has a pension annuity of $7200 or more. It is not uncommon. They are not full of BS because their monthly CVX annuity is several times larger than yours. Deal with it. A previous poster bragged about a 1.6MM nestegg. That, is a nice nest egg for most and well about average but only for the entire nation - Google retirement info.. Yet again, several times smaller than what many have accumulated especially in O&G and many in tech industries/services. Not BS. Deal with it. And don't post your own numbers online if you do not want them to be judged by others and perhaps ridiculed.
Have a nice day.
No, Veuk. Don't refer to "you all", only to those who use the childish word, "butthurt" in their posts.
I rest my case, Usdg. It didn't take long for you to respond. I called you out correctly.
-Uymg/Ujms, You dug the hole and jumped in and even as you are being buried by multiple, knowledgable sources you continue to spout out 'fantasy', 'BSer', 'fake' and 'exaggerate'. This might work for the orange one but not you.
I see I really hit a raw nerve with one or two of you, that you had to post more than once. We all know the BS'er claiming a $7200 annuity and a fantasy portfolio that's off by +/- $1.6MM is a fake. I called him out and he's fuming that even here on this site he is a failure in life. That's what you get when you exaggerate. People are not stupid.
@Uymg - Wow, you don't even know the basic facts about how your pension is calculated. Years of service is a multiplicative factor. The calculator doesn't ask for it cause it already knows how many years you've worked. If you don't know what you're talking about on a topic, it's better to keep quiet and try to learn something so as not make a fool of yourself.
@Uymg, I think you should check out the Chevron Benefits webpage and sleuth out some truthiness for yourself. The single life annuity calculation (which goes into the joint & survivor benefit calculation) is 1.6% x highest, 36 months of average earnings x YEARS OF SERVICE - Social Security Offset. So if you did manage to work for 100 years instead of the 27 you claim, your single life annuity would be 3.7 times more, and your joint & survivor annuity would benefit as well. I assume you let Chevron calculate your Social Security Offset instead of you providing them your actual earnings, this probably reduced your final annuity payments as well. I worked 29+ years before I EOI'd last year, spent the entire time on the technical career ladder (i.e. am not JW, GK nor was ever a manager) and my J&S annuity is in line with the poster you so confidently called BS on.
If you guys think $3MM or $4MM is something so utterly fantastic and impossible all you have to do is search some of the Reddit or other early retirement sites. There are many young Software Engineers in their 30's, who have more than that and are not even ready to retire yet. Some with inheritances, but many with $300k-400k salaries +bonuses and stock options, on the West coast, for instance, some NYC area. Also 80% savings rates, living frugally. Starting investing in 08-09. Joy. Welcome to the world, whipper snapper, life is not always like this.
I am not trying to burst your bubbles or be a Debbie Downer but that's just reality. And No, I have no where near that amount, and don't plan to ever need it. It's all about your own budget. many live on $40k a year easily in many areas of the country, with a paid off house and no debt, and very happily. It's all about choices, desires, and expectations. After a while you realize keeping up with the Jones does nothing for you, is self-destructive, and has nothing to do with your own personal needs, desires, and budget. Until you understand that, you will never retire or live happily and within your means. Many people with the huge portfolios on these sites make a hobby/lifestyle/game of saving and accumulating wealth, and rarely spend much and many live more frugally than you and me. dedicate it to charities sometimes. Think about it.
Uymg, I am not the poster you are mocking but you are a bit off base. To start with, My annuity, as calculated, is not much different, nor is my portfolio value, than Tozq. Yes, he could be a braggart, but not unbelievable and no more a braggart than the 1.6MM person who didn't know what he was up against. You stated you have a very respectable J&S annuity of $2250 or so. Be happy with that - it is more than most have. Do not mock other's or claim BS so quickly. It tells more about you than them and does you no good. I can personally assure you that a net worth or nest egg of 3 to 4 X $1.6MM is not unreasonable with a good position and proper, diligent investing. And I would not post my exact numbers either, nor would most people. But money isn't everything past a certain point. The person may spend $300k to 400k a year on things that are not even luxuries or travel/vaca. (insurance, apt. maintenance/management, upkeep, property taxes, etc.). Usually the high cash flow people live not much different than you and me. That's how they got there. Relax and be happy. I am happy with my old beat up pickup and laugh at the idiots in debt with their big fancy gas guzzlers that I can afford more than they can, but that's just me, as long as we are all happy with our choices!
@Tdkr, I was a 27 year career employee, but the Chevron annuity calculation doesn't care if I would have put in 100 years. It uses the highest 36 months of eligible pay (including bonuses). I wasn't no John Watson or George Kirkland either, but I know my 100% J&S annuity was only $2,250. My spouse is within 4 months of my age too. I also have a good sense for sleuthing out exaggeration and BS as well. That previous post about a $7,200 J&S annuity amount is not possible from what what Chevron pays 99% of its highest paid employees. The total give away was when the BS'er insinuated having plus or minus $1.6MM (when he said 3 or 4 times that amount). You cannot make this stuff up and sound credible. Sorry.
@Tlgq - Don't know anything about Tozq, but your assertion about how large a 100% joint survivor annuity can be is way off. I just went back and doublechecked my paperwork and mine would have been about 20% larger than that and believe me, I'm not John Watson or anywhere close to that. (I took the lump sum, but that's another matter) And my wife is 5 years younger than I am to boot (which makes the joint annuity smaller). Not sure where you're getting your data from. Maybe you underestimate the effect of decades of service and the fact that they include CIP bonuses in the calculation.
Which is it really, Tozq? Three or four times the $1.6MM? Don't tell me you don't remember. If you can't be accurate to recall if you have plus or minus 1.6 million throws your braggadocio into extreme doubt from what I read. I may add also that a monthly $7200 joint and survivor annuity amount is not possible unless you are J Watson, G Kirkland or other million+ salaried employee. Sorry guy, you overshot your lie with that post. But I'll give you one thing, if you did actually take the annuity, whatever real amount it is over $1500, congrats, because it really is the best way to go.
Tmjq. You are so correct. Even though I have three to four times the assets that some posted on here, like Qngq below, I have chosen the annuity also to play it safe. I have done the research, checked Vanguard, Fidelity, Schwab and others and you just simply cannot match the 100% joint survivor annuity on the open market. That's $7200 a month guaranteed for life until the last one of us dies. The severance was just icing on the cake. I almost wanted to give it back it was so good. Who said getting laid off was supposed to not be fun - Ha! Maybe there's a new car or boat I may want one day. But not today. I am content with my good old beater and my fishing kayak which I use several times a week now. Don't be so concerned about a market turn-down. That's what the annuity is for. Let the arrogant market timers and fortune tellers like "you know who" below sweat it out in the market. A 40% turn down + annuity and you're still sittin' pretty. All of my assets are in relatively safe investments and real estate. I do have some equities, just not as much as when I was a younger lad. Good luck to you all.
I have your same view, Sgwz. Retirement is a time for enjoying life as best one can. Worrying over losing money sure isn't a way to enjoy life. I took the annuity also and conservatively invest my 401 and Roth IRA savings. I'm becoming more concerned that although I'm diversified in low risk funds, they has been more talk of a possible serious stock market correction as high as 40%. For that reason, I'm paying a lot more attention to the markets and world economics.
@Qlts, I'm happy where I'm at with my life and investment plan. If I had a larger nest egg, I wouldn't change a thing. It would still be the annuity and conservative investing of my retirement savings. Retirement (for me) is the time to enjoy your life in peace.
@Qlct, Your investment plan may be a good one for you and others. At least it seems you've put much thought into it, which is a good thing. Everyone needs a plan, even though there's a risk in it all. I have my own approach to investing and manage my own nest egg of $1.6MM. I opted to take the Chevron 100% joint & survivor annuity because it pays a guaranteed $4,100 monthly for the rest of my spouse's and my life. Between the annuity and social security that I started receiving 3 months ago, we have more than enough money to meet all our needs for at least 10-12 years out. Our bank savings along with the 1-year severance payment from Chevron serves as a cushion reserve. As you can understand, one plan does not fit everyone. Your strategy is one to consider and can be tweaked as each person sees appropriate for them. I have a more conservative approach to investing my 401k and Roth IRA money, because that's just me.
The annuity from CVX is a s---er bet, made attractive by security. You got a severence? Maybe also had a couple of years paid up? Take the lump sum, roll it into a self managed IRA with E Trade or any of them. Find a good mix and take your time investing in stocks with good dividends and strong performance. I like about 40% big oils, CVX, RDS, BP, XOM, 40% of the best blue chips I can find with better than 3% dividends and closer to the 52WL than 52WH due to the economy F, GM, VZ, T and about 20% in REITs and other dividend bad boys with solid projections. Don't touch this for a year or three, live off of your severence, savings and selling your stuff you don't need, and you'll be amazed at what you're looking at 3 months then 3 years down the road. Model it, then run some FireCalc portfolio estimates to verify. You could call this "Reverse Dollar Cost Averaging," if we all di this we'd put the so called financial advisors out of business, you know, those guys who will DCA you into nothing while driving around in their Lexus and Mercedes. But reality, they know, like we know, that maybe 1 in 1000 of us have the balls AND the brains to do this, so they're safe.
Ofeq, All most of the laid off or soon to be laid off losers do on this site is insult people so you might as well get used to it. And they generally have nothing to contribute of any value, just blowing off steam. Then there's the dimwits who make a comment every so often that they hope college kids read these comments (or ignorantly call it a "blog" which it isn't), as if college kids would be looking here for useful info. I don't know one college student, and I work with many as interns, who are that stupid to not realize the nature of the worthless comments from a site such as this, considering the sources - laid off personnel who are looking to blame everyone at the company but themselves for their being cut and accusing the company/management of everything illegal and unscrupulous that you can dream of. It's like that at all of this layoff threads for all the companies. Chevron is nothing special. Some people have just been drinking the koolaid and have never worked anywhere else. I, as a contractor, don't believe that biased/closed-minded view of the working world is very healthy to your career. Shell, XOM, BP, Noble, Marathon, S.Aramco, etc., are all just as bad and in some divisions/units are much worse.
@OrCSQGR-Oqzq, which SWR would you recommend? It's obvious that you do not agree with the previous poster but all you had to add was insults, and you are obviously envious of other's financial success, which you lack, from the tone of your post. Care to add anything constructive to the conversation? If you disappear, it will be confirmed, you are a common troll with no life and are a financial imbecile and embarrassed to respond.
-Oqzq , Yes, but he/she will surely take financial advice from a 3rd -grade level loser like you, since, after expressing envy, anger and ignorance, your insults just sound "Oh so sincere" and intelligible - LMAO!
@Nwzl, just from reading your 6th grader-type rant, I conclude you are no savvy investor by any stretch of the imagination. Save your words and while you're at it, better save your money too. Seems like you are no where close to financial independence. Lol.
Yes, that's true, just a tiny portion of a portfolio like he revealed does not tell the entire story. However 5% is not conventional wisdom for SWR. It's generally 4% and many opt for 3 to 3.5 to play it safe. I definitely would not budget for 5% and not even 4% WR from my next egg for the initial stages of retirement after all that I've seen and been through.
What's quite laughable, though is the old geezers that get on here and throw out a phrase like federal reserve interest rate or cite fundamentals of inflation and expect everyone to bow down with shock and awe of their financial prowess, as if they are the only ones (besides my 7 year old grandson) who know anything about investment basics. Then of course they invariably hang themselves out to dry by claiming "because of a, b and c = Nostradamus prediction of what the future holds for mankind". No wonder financial advisors and wealth management firms exist, and are some of the wealthiest entities in the U.S. economy.
The only quantitative asset he revealed was $1.6 mil in his 401k. Otherwise he has savings, rental income and pension. Depending on his lifestyle, I'm sure he can be financially independent and comfortable. 5% yield on the 401k plus the other assets should give a good, sustainable income. How much do you really need? BTW, my own 401k represents only about 12% of my assets. What does that tell you.....Absolutely nothing. One input to a complex equation does not reveal the big picture. If the guy says he's good, he's good. Leave it be and recognize him for achieving HIS goals, not YOURS.
Nqmn -what the heck you talking about? his assets aren't that bad. Now, definitely below average for a normal Chevron employee, well below what I have accumulated, but much better than many in the US as a whole. Of course, I agree, that's nothing to brag about and not something I wouldn't be posting online, I don't know why anyone does that unless they want to be ridiculed. I guess you get what you ask for.
@OrCSQGR-Mczn, ROTFLMAO, imbecile idiot. Next time don't post your pathetic financials online. Or at least multiply them by three or four, do yourself a favor - lol. You're anonymous and that's simply embarrassing for a 59 YO in O&G. Please. There are millennials that I know with 4X your assets and they aren't even THINKING of retiring.
Should have paid better attention in school, lil' fella, I'm telling you. Hope that SS is still available when you need it, and it looks like you will.
In addition - Find something to do with your free time. It sounds like you don't have a life and need to troll lay-off sites. Just a hunch that I picked up from you trolling here without a life or purpose - LOL!
@Mvxk, I am "retired" in the absolute meaning of the word. Retired - Not working, don't want to work, on my own time now, don't bother me until noon, whatever. I'm 59 and have enough income from my Chevron annuity pension, paid-off rental property and my bank savings to nit have to dip into my $1.6MM Vanguard 401k for years after I'm 65. I haven't even starting mentioned my Social Security Income I plan to start drawing as soon as I'm 62. As you should be convinced now, when I say "retired", I mean RETIRED. And BTW, I'm doing pretty good.
@Mick, It's no secret that when anyone retires and no longer working, there risk tolerance automatically gets very conservative. The annuity from Chevron is a serious choice for many because of its guaranteed income. The 401k savings then becomes the only thing requiring careful investment which they don't risk too much. I suppose you need to be retired and no longer working to truly realize what I'm saying.
Have a google for the graph of last 62 years of fed rates if you think rates have more down side than up side from today's 1% rate. If you don't know what a fed interest rate is or if you think you are getting a 6% return on investment by taking the pension, take the pension!
If you already took the pension, no need to wade into the debate as it is too late for you to change your mind. Spend as little as you can and pray inflation never returns.
I would prefer to not take the lumpectomy, personally although the option is still open for me. I have checked the online calculators for many private annuities including Vanguard and cannot find a better annuity on the open market, nor would I want to do that route. If you take the lump sum, for the sake of God, don't turn around and purchase an annuity. That's defeating the purpose isn't it? Don't you expect to invest it and make more? Or is that too risky of a proposition, like counting on interest rates to rise? Listen to yourselves. Gambling is gambling. It really doesn't matter what you're gambling on, it's still a gamble. At least the CVX pension annuity is backed by an outside guarantor. Vanguard annuities are guaranteed sources or income, guaranteed by them. as are all private annuities. It's unlikely, but they can go down.
@Lgkk, your premise goes on the assumption that interest rates will rise in 5-15 years after taking the lump sum now during low rates. Questions: What sum are you going to live on while waiting 5-15 years to go by? How much principal will there be left to put into the Vanguard annuity when that time comes? Will the market provide you at least a steady 6% return (Chevron's equivalent annuity return) while you wait for interest rates to rise? Summary: A retiree should be spending their golden years in relative 'financial peace and tranquility', not sweating it out and worrying each year whether their financial goals are on the edge of a cliff. I chose the Chevron 100% J$S annuity and don't regret that choice at all.
One thing to be careful of when doing the comparison is to be sure you are comparing the exact same type of annuity. For example, the CVX 50% spousal option will be 50% to your spouse if you die first but pay 100% to you if your spouse dies first.
There is no need to speculate. You can do your own comparison using the online tools from CVX and Vanguard and make your own decision. When I do it, I get the same money now but far more flexibility with Vanguard and and a great deal more if I wait. Plus it all makes sense. Take a lump sum when rates are low but annuitize when they are high. Interest rates will surely go up over the next 5-15 years.
It only makes sense, if you want a higher annuity payout, go with the original payer (Chevron). If you convert it to a lump sum to go to a third party to reconvert back to an annuity, your amount will be less. Why? The third party must realize a profit. No one does anything for free.
Everything I have heard or read about taking the CVX lump sum and then converting it to an income annuity (constant monthly payout and the type CVX offers) is that you will not do as well as just taking the CVX annuity. I went to the Vanguard site and if I took the lump sum today and then immediately invested it in a Vanguard income annuity, my monthly Vanguard annuity payout when I reach age 60 (same age as when my CVX annuity would start) would be only 93.8% of what the CVX annuity would pay. If your talking about Vanguard variable annuities then your comparing apples to oranges. If you want a constant monthly annuity payout, stick with the CVX one, you cannot do better than that.
@Kmry I agree with that approach also, What the poster below brought up was an interesting option that he/she is considering to go with Vanguard for the annuity after taking the lump sum, which he calculated to be a better deal and also offers more flexibility to wait and get a bigger annuity. Of course, that's how annuities work. The older you take a lifetime annuity, the cheaper it is or the higher the annuity is for a given purchase price, which Chevron does not offer, IIRC. What I don't understand is why so many posters on here have already checked this and noted that on a side by side basis, the CVX pension is better than public market availability price wise. I think that it may be deep into the details, though, like your exact numbers, whether you choose 100% joint survivor, etc. Or perhaps Vanguard is offering a better deal today than before? These things routinely change with market conditions, right?