How soon will they stop the lump sum payout on your RIGP?
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To the person that posted... having a letter stating lump sum payment information... I don't recall that. Can I get a copy of that from you ?
This is not the place . At least half of the statements here are incorrect. Get your investment advise from a layoff forum, suffer the consequences.
To make this simple - Who would you rather have controlling YOUR money (Xerox or you)?
Answer this question and the rest is fairly easy
TAKE IT NOW!!!
If the funds drop below 80% they won’t give you the whole lump sum. It will be some a smaller lump lump some and an annuity. They lower the funding the less of a lump sum.
@dyy+1aevXuxf Why spread misinformation? I took the lump and rolled it over into an IRA with no tax implications. If you take it and don’t roll it over yes there are tax implications. Best for OP to read the rgip FAQs. This site has zero accountability for factual information.
If Xerox was going to halt all lump sum RIGP payouts, I predict it would happen by quarter end (June 30) or not at all (for the foreseeable future). My rationale is that the optimal time to have cashed out on RIGP was between Sep '20 and Feb '21. That's when interest rates were at historic lows and would have boosted the lump sum valuation to their highest levels ever. Now that interest rates have started their ascent, COVID cases are on the decline and the economy gradually improves, lump sum valuations will remain flat or trend downward as interest rates rise to pre 2020 levels. As Xerox employees or retirees start to see their RIGP valuations stagnating (or worse, dropping), many more will contemplate cashing out. If Xerox brass does not replenish the sudden drop in the Pension fund balance, it could fall below the 80% (funding/liability) threshold, triggering a 50% lump sum / annuity (or the company preferred 100% annuity option). The next few months are critical and will dictate what RIGP options remain for future retirees.
If you are talking about taking a "lump" sum if you quit, retire, or laid off, there are no taxes as long as you roll it over into a IRA. I did it with my bank and had to have the account ready to accept it. In the forms you fill out it will ask you for an account number and bank routing number. Make sure you have the account ready to go or they may just send it to you instead of FBO "for benefit of" to whatever bank/institution you chose.
The other question as to whether they are still doing lump sum payments may be up in the air unless they honor their commitment. I have a letter that as far as I know has not been changed that was emailed to everyone a few years back which says if you started work before Jan 1 1990 you would be eligible for 100 percent lump sum. After Jan 1 1990 if the fund went under 80 percent it would be half lump sum and half an annuity. Under 50 percent yielded a 100 percent annuity.
Go to the benefit site and do a projection a month or two out and see if the lump sum option under "all payment options" is still available. It will either be all payable or half annuity half lump sum or all annuity.
Read the rigp faq doc, updated march 2021. Why ask a bunch of random people ??
Why are you asking
Roll the lump sum directly into an IRA. Then the money can be invested and you are only taxed on what you take out of the IRA. Consult a qualified investment advisor. This is one of the most important decisions of your life.
lump sums are subject to automatic 20 percent tax
As soon as they can