Lump sum option is in the way out. The economy tanking is only going to accelerate the xerox free fall. When they don't think twice about nixing retiree benefits and slashing headcount, pension funding is not going to be a priority.
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At age 65 (retirement age) from that table the PBGC guarantees a $75K a year payout. Not many get that high a pension payment from Xerox. To get that payment amount you would had a salary of over $180K a year in 2012 when the plan stopped (as 42% is the max retirement payout based on your 3 yrs average high salary over a 5 year period, including base, commissions, and or bonuses) - at Xerox to make that $$$ you would be the exception in 2012 making $180K+ a year (you would be the exception in 2022 making that much at Xerox unless you had a great few years in sales - or were a highly paid executive). Also using that table the spousal payment is $67K (not 50% of full payment as other poster claimed) a year payment. I think 99.9% of retired Xerox employees are fine for the monthly or spousal payment to be 100% covered. Do your research. Know your numbers. Think. Then act. Seek the help of a fee only (no AUM or commission sales) financial professional if needed.
The two downsides to PBGC (if they take over plan in future) is you can only get a monthly payment, not a lump sum, it is the same exact payment amount, it just limits the option to take and manage your own money (statistically it is the same, maybe even a bit better to take the monthly payment, but you trade off flexibility). The biggest risk to a PBGC payment is the survivor option is limited to 50% of the monthly payemnt, so if you elected and planned a larger amount (75% or 100% reducting your monthly payment to cover a spouce) the insured benefit only pays 50% max monthly. So this is your biggest risk over time. At some point in the future the risk of PBGC ownership gets larger. See this link https://www.pbgc.gov/wr/benefits/guaranteed-benefits/maximum-guarantee, look up the 2022 payment schedule and you will see that most Xerox people are well under the maximum monthly payment in retirement - so your pension is as safe as the Federal Government (I know this comment trolls!).
The greatest risk is your longevity (not PBGC insurance) - in that you are the one who dies earlier when on a monthly payout.
if you are eligible for the lump sum consider getting out as soon as you can. The segment rates change monthly and they are going up. Even a small increase in the segment rates can severely reduce the lump sum. i took the money and ran. Talk to a finance expert so that you know and understand all your options!
Thank you - I looked at those reports and I have to admit I do not understand them - they don't say anything to me I can easily understand as a plan participant (more reporting). But, appreciate the site to look them up. THANKS for the site and plan look up.
Also this is very valid and true!: "Don't let layoff.com be the source of information for one of the biggest financial decisions you will make in your life." This pension stuff is confusing. But, I would think we are not that 'unsafe' due to PBGC backing? Why is it so hard to get facts?
No, it's wrong.
The post below is absolutely correct. Here's the link to the SEC reports for Xerox. There's a button you can click to sign-up to get notified via email about any updates or new filings.
https://sec.report/CIK/0000108772
80% is the minimum funding level required by US PBGC in order to provide 100% lump sum payouts. If they go under the 80%, then PBGC penalties will be assessed. Xerox operates at this level as do a lot of other corporations. It doesn't mean the plan is at risk, only that they are staying in compliance.
That doesn't mean it is ideal for the participants, as fully funded would be much better. Most companies prefer to payout lump sums vs lifetime annuities, and as the 3 segment interest rates go up, the lump sums go down. One time payment, no further obligations, and one less person they have to pay to PBGC for insurance.
Stay vigilant, pay attention to the 10Q's and 10K, and any ERISA filings, and worry when you get an official notice from the company that the plan will change. Don't let layoff.com be the source of information for one of the biggest financial decisions you will make in your life.
Like I said, in the way out. Bye Bye 👋
Looks like the US funding level is just under 81% if I read that correctly?
You have no idea what you are talking about.
If anyone is interested in finding the actual filing for the US RIGP plan to see if it is funded and in compliance, then go to this site. https://www.efast.dol.gov/5500Search/
Search for 'Plan Sponsor' = xerox, EIN = 160468120 then click on the 'Plan Year' column to find the most recent filing for the plan that was submitted on 11/15/2021.
Rules changed. Funding is in the 90's. I know that will pi-s off the whiners. I'll take my 7 figures whenever I want it...
Wrong
US pension fund was at 96% the for 2022 report. Also with so many old people going last few years the BIG hitters are paid out and gone. With rising interest rates this is good news for how the US pension investment fund has to invest (better returns). Even if it drop in future no worries as it is backed by PBGC (Fed Funding like a bank) - so who cares who writes your future payment. And by UK law the local pension there requires 100% funding.
Xerox doesn’t play by any rules in todays workplace …Don’t trust anything they say or publish as this company is famous for Doublespeak.
Last i saw was 80% and has steadily dropped the last few years. Extrapolate...
What is the funding level in the US? It's been fully funded in Europe for many years, but the last data I could find for the US it was in the 80s somewhere.
Fully funded for the next 2 years. This id--t thinks it’s pay as you go for XRX.
You clearly don't know what you're talking about.
Enough with the du----s trolling comments. It’s 100% funded with the new regulations.
Don't hold your breath
At least we are getting 401k match
Proof that it's going away or STFU.
This has been a chicken little topic for a long time, although it is a lvalid concern. Good luck, everybody.