Absolutely not!
7 replies (most recent on top)
The amount shown does not account for the taxes that will assessed. I'm going to take my 70k and run.
I was told that the 20-30% ( whatever it will be depending on your tax situation) is not already taken to account in your balance in Netbenefits. Anyway... HP stopped contributing to the pension when I was 2 years in.... and will only grow to $10k by the time I'm 65. Yeah I'm cashing out now.
If you take the lump sum now, you'll pay a 10% tax penalty (the amount listed on their web site already take 30% withholding into consideration).
Taking a penalty still might make more sense to pay off debts on anything costing more than 10% of that debt over the time you have to pay it (not annual, but total cost of interest over remaining time) because:
1) You'll have a better credit rating
2) You will have greater cash flow to put money back into retirement on your own terms
3) You'll be able to afford the commute to an HPE facility (Costs me about $300~400/mo extra to travel to an office)
4) You might need the money to supplement unemployment, given how Meg and her crew have been raping it
5) If you collect unemployment for 12 weeks this year, no 10% penalty!
I've got at least 15 years to make up for the hit on my retirement fund, with a decent budget surplus paying off my debt brings, I'll more than compensate my IRA plus some. Otherwise, I'm living paycheck to paycheck never able to add another dime to my retirement.
The economy, for those of us who aren't rich, is poor anyway. No good return on investments for us unless you have the kind of money and attention to manage those investments, and most pension funds are getting hit when people like Meg have finished their job looting a company and parting it out... AND selling off all their stock, that company crashes, the stock crashes and the ones left holding the bill are the pension funds. Debt just sucks money out of us at an alarming rate.
Are they going to be offering early retirement again?
I'm considering cashing in to pay debt as well, but $700 a month for the rest of my life after age 65 is nice addition to whatever else I can save for retirement. No, it's not much but it's something.
My thinking is it might be better to cash in now, and clear out the debts that have accumulated due to my pay not keeping up with inflation (thanks, Meg). I could probably change my cashflow $700~1000 a month and avoid paying interest while living paycheck to paycheck.
I wish I could. They stopped contributing to the pension maybe 5 years into my career so there's only peanuts in there.