I am 60 days from when I got approved for lump sum severance payout and only received a portion of it so far. I received only two weeks right after my notice period ended. I just called and the Displacement Rep sounded surprised, then reviewed my pay slips and said he is escalating this.
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What's Charlie Scharf's severance going to be, I wonder.
I took the lump sum - couldn’t be happier. I have no intent to ever work for WF again and now I’m just done with them!
Got it, thanks for the story!
everyone's financial situation is different, and whether you should take a lump sum or not is not a blanket solution. I'd say if you have other benefit options like through a spouse and the lump sum won't put you in a higher tax bracket then go for it, only lite tail risk is if your tax bracket is higher or lower than the 22% they will tax it you will have to wait until tax time for it to normalize. plus with a lump sum you could put that money in a high interest savings account making 5% and withdrawal as needed
Do you have to pay back part of your lump sum if you get rehired by wells within a certain time?
The OP says they submitted it months ago, which means they would have been able to split the income across two tax years: 2023 and 2024. Instead, if you get the lump sum all in 2023 after already getting 10 months of salary in 2023, you're essentially getting paid 2 years of income in 1 year, pushing you into a way higher tax bracket.
OP is actually extremely lucky he/she did NOT get the whole lump sum in 2023.
“ I would never take the lump sum due to the amount of taxes they take out.”
For a financial employer we sure have a lot of folks who don’t understand that money is fungible or how to manage their own assets.
I went through this. Unless you request it - severance pay is not lump sum. You get paid every two weeks until the severance is paid out. Deductions for benefits (except 401k) continue. You do not have to deal with COBRA until your severance is paid out. BTW COBRA is extremely expensive.
If you continue with biweekly pay for severance I believe they continue to take out medical/dental insurance payments. With lump sum they do not. If this is correct then better to opt for lump sum if you have another job or getting medical benefits through spouse. Taxes don’t matter much since it will even out come tax time, unless of course you need the money now.
I would never take the lump sum due to the amount of taxes they take out. I enjoy getting my severance every two weeks while collecting my new paycheck from my new company.
Should of posted here before deciding to take lump sum payout
The lump sum payout is a bad move.
they may tax it higher or not enough depending on your tax bracket. regardless, you'll either pay more or get a refund come tax time.
Ok? You called them and they are working on it. What's your point?
They tax it higher when you take the lump sum