Oh happy day!
Arrived in the mail on 4/3, hopefully others are seeing theirs!
laid off 12/1/20
final day 2/1/21
10 replies (most recent on top)
@2ucy+1aetRz9R
The lump sum versus annuity for a retirement eligible person is an obvious choice in the current interest rate environment (lump sum). The early lump sum is a more difficult decision. It is really all about whether when taking into account the penalty for drawing it early can you beat the annuity return. I believe you only get 20% of the pension value when you are sub-50. That unfortunately is a lot of return to make up. I’m probably going to take the early lump sum, but I have a pretty juicy investment opportunity (100% ROR). I’ll still go through the exercise of calculating the present worth of the annuity just to be sure, but I think I already know the answer.
When I was at XOM, I recall playing around with the pension calculation tool and looking at scenarios where I stop work in 2021 and get a lump sum or annuity later in life and definitely a debit to the lump sum you get now but I honestly never really quantified the percentage lost or anything of that nature. To be clear, even though I looked at lump sum later in life, terminees don’t have a lump sum option later in life, just an annuity.
My general thoughts is that I can make up the difference by investing the lump sum now and manage its growth.
I have a rudimentary understanding of how all of this works and I am sure I am not optimizing it but just happy to be in control of the money and be done with Exxonmobil.
Maybe someone with a little more bandwidth in retirement/financial planning can comment on whether waiting for annuity and leaving it alone is advisable against taking lump now..
Hi OP and thanks for the information. Did you have to take a discount on your lump sum due to your age ?
OP here
14 yrs, nominal $125k salary, $140k lump sum
Thank you everyone that commented with additional information and clarifications.
It's also available to people with 5+ years who have resigned.
6 years experience, salary 130k (avg over last 3 years), getting $47k
Was the amount what you expected? I have a guess on what mine will be (roughly 1 year salary), but the early calculation has so many extra pieces to it, I have no clue what’s coming. I had 21 years with the company.
Thanks for the information. Will be on the
Lookout. After this, there will be no other ties to the corporation.
Questions for OP. Number of years with EM? Age? Salary? Lump sum amount?
Sorry for lack of details on the original post but I was not retirement eligible but anyone terminated via layoff that was not retirement eligible has the lump sum pension option if you execute it soon, otherwise it goes away and the pension payout will be an annuity that will be later in life.
Were you already RE when laid off