13 years of service. Recently laid-off. I had/have the 'newer' cash-and-carry pension and did take a printout of the pension calculation on my last day at the office. Also, I have it all hardcopy unopened from corporate. : ) I do not want to keep my, now old, pension funds in Honeywell hands and have opted to go with Fidelity's IRA Rollover. I attempted to call Honeywell's HR help line (option 5) on their help sheet, but there does not appear to be an actual person on the receiving end. I was able to set up an appointment with them which is Monday next week (no idea why I have to wait a week for that). Given we are talking about a ton of money here, I am nervous about getting the corporate run around on getting MY money in MY hands. Being an outsider now, I can't find where I can access information. Fidelity made it seem easy... I give them my info and they mail Fidelity a check. Any advice you X-Honeywellers can give would be appreciated. Am I going about this correctly? Do I have a right to be nervous on not getting a cash out check easily?
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FYI - due to Covid, if you take a lump sum instead of rollover, I am reading they wave the 10% early withdraw fee.
Also reading the tax hit can be spread over 3 years. I am not sure how you keep them from taking the 20% off the top though. Has anyone done this?
There is a also a rule you can take a distribution of up to 25% with no tax hit, but I don't know if that refers to a partial distribution during rollover or a distribution once you are retired.
FYI - due to Covid, if you take a lump sum instead of rollover, I am reading they wave the 10% early withdraw fee.
Also reading the tax hit can be spread over 3 years. I am not sure how you keep them from taking the 20% off the top though. Has anyone done this?
There is a also a rule you can take a distribution of up to 25% with no tax hit, but I don't know if that refers to a partial distribution during rollover or a distribution once you are retired.
Work with Fidelity. They can take care of everything pretty quickly. At least that was my experience.
https://leplb0750.upoint.alight.com/web/honeywell/login?forkPage=false#/routing
Folks, here's an external web link you can use for the Honeywell pension signup and questions. Paste it into your browser, press enter and you have to sign up as a new user.
I started in 1981 and left on a VRIF about three years ago with the old Garrett/Signal Co. pension which was an annuity only. I signed up on the website about eight weeks prior to my six months of severance payments ending and I chose a start date for the 1st of the month after my severance ended. I had no problems going through this site and the process was surprisingly seamless. I still use it occasionally to adjust my fed and state tax deductions.
Last, my annuity payments and tax form 1099-R come from Northern Trust Insurance Co. Honeywell transferred my pension fund to an annuity at this insurance company and I'm not dependent on the viability of Honeywell as a company in the future.
Well, I absolutely deserve all of the thumbs down...for some reason I thought the OP was pulling the money and not rolling it over. Bad reading comprehension. :(
Just FYI, remember you can roll over your pension into a Fidelity IRA (and let account continue he to grow u til you eventually want to take disbursements) and just pay a very reasonable expense ratio fee (they have many below .8 and 4 newer ones that are no fee). I had picked out a couple index funds with low fees that I want to roll my pension into (50/50j and when I called Fidelity, a rep talked me through the whole transfer process and the money ended up in those 2 funds.
If you later decide you want Fidelity to actively manage your account and pay 1.3+ percent , you can make that change.
Take time to check out the info pages for individual funds Fidelity offers to see what the expense ratio fee is, what the fund invests in, 1, 5 and 10 year history, etc. Talk to a Fidelity Advisor to ask about pros and cons of having them manage your account t to help decide if it is worth while for you.
If you are close to retirement and want to protect some of your funds in low risk bond funds, Fidelity
offers those too.
@1vpx As far as I know, the "rule of 55" only applies to your 401k. I KNOW it does not apply to IRAs or 403b plans, and I'm pretty sure (backed by a quick search) that it does not apply to pensions. 457 "deferred comp" plans don't have a penalty.
To avoid the penalty on the pension lump sum, you have to roll it into an IRA.
You won’t pay any lump sum penalties if you do a rollover. You only pay penalties or taxes for actual withdrawal.
If you turn 55 in the year you withdraw, there is no 10% penalty on the pension. They take 20% Fed tax off the top of a lump sum distribution - then remaining tax at tax filing time. But as other poster said, the lump sum withdraw is added to your earned income for the year and may throw you into a different tax bracket overall.
The Pension fund "help" call was really no help at all other than giving you the website addresses. www.myfidelitysite.com/HONEYWELL for the 401k. HTTP://digital.alight.com/honeywell for the pension. I was told you can do everything online. I would get a financial advisor or talk to fund manager for IRA you are transferring to if you have questions or large sums to think about.
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No 30%, you roll over into IRA and get taxed as you pull out and spend
Lump sum pays better than annuity at 60, so taking that.
Fidelity management charges me a total of 1.4% of my total portfolio to manage my account. It is taken out quarterly. Im not an investor by no means so i felt like they would do better than i would. The more i make the more they make. Im very happy with them so far. They have earned me 40k since March 20th.
All but impossible for me to understand why a long-tem employee who would have a chunk of money in their pension would take a lump sum. You're worried about the company keeping funds??? How about the higher tax rate you're going to pay and the 30+% you've just gifted to the government this year in the form of taxes? That's 30+% on retirement funds plus any regular pay you've recieved this year...it didn't just hit the excess pension funds coming out, you just volunteered to pay MUCH more of your earned income, too.
Can you get subsidized healthcare now, with that chunk of change coming your way? Nope.
Can you squeeze it into your bank account over a couple of years at a nice low tax rate? Nope.
Can you find bonds that spit out steady 5+% like the pension was averaging? Nope.
Even though Luck is not a plan, Good luck in retirement.
I am moving my pension into my IRA and it has been going on for 3 months now.Nothing is easy when it comes to HW websites.....I wish I would have know about moving it to Fidelity . It sounds easier to do it that way.
I quit Honeywell in June. I went through the paperwork to get a lump sum payout. The fund disbursement is confirmed for Sept 1. These are the steps I went through:
1) Call to make appt with retirement specialist (option 5)
2) Have appt with retirement specialist and they will calculate your final lump sum value (which will be close to the estimate, but calculated to your last day of service)
3) They will mail you an authorization form to sign. I am married, so I had to get my spouse to sign it (spouse is entitled to 50% of retirement) and get it notarized. This form has the mailing instructions to rollover financial institution: address, Account #.
4) Mail the form back in and they will process and confirm the authorization and schedule a disbursement date.
5) A check will be mailed to you (but it made out to the financial institution you elected), and then you forward it to your financial institution.
I know another individual who quit several months before me, and it took them 4 months to get their money. Like everything else, Honeywell holds every penny as long as possible. They pay out the pension in monthly windows, and all your paperwork has to be ready by X date to make a window 30-60 days in the future.
Call Fidelity and tell them you want to roll over your entire 401k into an IRA, they will walk you through the process and do the paperwork for you. (Don’t get a check from Honeywell then deposit it with Fidelity - extra work- just let Fidelity do a direct transfer for you). Maybe just select one of their basic index funds (S&P 500 Index) with a low expense fee for initial roll over. You could get fancy and move money to other funds later since once your money is at Fidelity it is easy to manage it.
I see people have commented you need to wait until severance period is over to do a roll over - I don’t have expertise in that area, but worth a call to fidelity to ask. You might be able to open a fidelity IRA and deposit, say, $100 a month, while in your severance period to have an established IRA with them - then have them transfer/rollover your Honeywell account whenever it is allowable.
I'm on the lump sum, riffed after 17 years. I called the day after I was notified I was out. They stated that I can't do anything with my lump sum until two months before severance ends. At that point, I can only notify of them of what I want to do but have to wait until severance ends before I can actually take any action on it. If you take a cash withdraw, per insurance and tax regulations, you have so many days to roll it into something else such as an IRA. I believe it's 60 days but don't quote me on the actual day requirement.
If you are getting severance pay, do not take your pension until your severance is finished. Read the severance policy
Yes be nervous. I left Honeywell after 26 yr of service in April. I had the new pension plan and took the lump sum payment. It took Hon 4 months to cut me the check. They screwed up the paperwork several times. Need to stay on top of them. I rolled my pension it into Morgan Stanley and built a bond ladder of bonds paying 5 to6 percent. Fidelity will be about the same. DO NOT leave YOUR $$$ with Hon.
To the poster who is using Fidelity Management, how much does that service cost? Thanks.
I was on the legacy Honeywell pension that pays annuity only. The told me I didn’t have a choice but to take the annuity payments when I reached retirement age.
I left Honeywell 8 months ago. I went with Fidelity Management. I rolled my lump sum and my 401 into Fidelity management. Call fidelity and get a advisor. They will walk you through the process. It was very easy. I lost 133k in March before the roll over was finished. Fidelity has made 40k of it back in 3 months. Hope this helps.
No need to be nervous, just get your new agent to handle the rollover for you. Take the lump sum not annuity. But keep your printout just in case, and question if not similar value.
No need to be nervous, just get your new agent to handle the rollover for you. Take the lump sum not annuity. But keep your printout just in case, and question if not similar value.
No need to be nervous, just get your new agent to handle the rollover for you. Take the lump sum not annuity. But keep your printout just in case, and question if not similar value.
I worked at HON 18 years, just got riffed. I called about my pension. The first told me I had $700 in my pension. Really? I then asked again. They clarified that it was $700/month in the annuity once I hit retirement age. I then asked what the cash total was. To my pleasant surprise it was between $150K - $200K. Unreal. I asked if I could cash it out and roll it into an IRA. The operator (who was totally clueless) told me to be careful as this would be considered "early retirement". I explained that I was laid off.
This is all typical HON. They keep the whole pension thing opaque because they want to keep the cash. I plan on rolling it into an IRA, but I am expecting a fight and a lot of bureaucracy.
So yes, be nervous.