Any smart advice about the pension calculation using November, 2017 interest rate? Is that a no-brainer to take it and run by April 1, 2019? Waiting for a severance might mean losing more..in the long run?
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lets hooe you don't have to pay back from pension fund miscalculations, strapped for cash companies uses all the tricks to f--- with you, without Vaseline,LMAO
A much bigger Issue on the Management CB calculation is what company your pension plan is with. In the last voluntary offer (made a week after the Cash balance option was offered for Legacy T and Legacy S) it became clear that there are huge differences in the calculations based on the pension plan terms. Example- A Legacy T employee in my group with a very close salary and the same service date (1981) was offered a $511,000 CB to retire and took it. A Bellsouth (SE Management plan) covered Manager with the same service and salary would have over 6 figures lower in their CB calculation. An Ameritech Plan covered employee with 20 years service and 60 years old in my group was offered over $400,000 to retire and stayed- over $200,000 more than a Bellsouth Manager with 20 years service and similar salary treatment- age is not a factor in the SE Plan CB calculation only salary and years of service. Yes, there are other variables like craft service combination benefit (pre 1999) for SE Managers but the Interest rate changes are tiny compared to the examples above based on your plan. Good Luck and at least the south has better weather................
It isn't that big of a deal ... other than in one's head ... if you get less in a lump, it is because you theoretically need less ...... because interest rates are going up!
I would rather have a smaller lump and lock in 4, 5 or 6% in a CD .... ( 5 year is already back up to 3.65-75% ) rather than receive a huge lump and have to invest more into the stock market to get a yield.
Ideally you get the lump in the rate transition, which is possible now ... at the FED they are already talking about no next interest bump or even reversing, since it is too much too fast it seems.
Good Luck!
Don't have any advice for you; but, You are certainly looking at the situation in the right light. That lower interest rate (discount rate) for lump sum calculations will be gone come December 31st and I too hate to let it go by.
Me, I am just holding my breath that another financial calamity will arrive in the next few years and force them back down again. Chances of that happening are pretty good I think.
I hope I am not making a mistake by not taking advantage of the lower discount rate we have right now. It goes way up on January 1st. I don't even want to know how much my lump sum will be down in 2019 as a result of that.
Working additional years doesn't seem to make much difference in the calculation. It is all about that discount rate. It injects massive leverage into the calculation. If it goes way down, that is great for you and me. When it goes up, You are losing money out the ying yang.
@1tit, my CFP agrees with the people you’ve talk to. Think about certainties, for those married....two Social Security checks and your Pension check. Should one spouse pass, the survivor is cared for with that annuity.
When the ‘07-‘09 recession struck, AT&T retirees, that had the Annuity, had that security blanket to keep them warm while they waited for the market to recover. Your pension is safe, though there are legitimate reasons to grab it as your out the door....family health history, or you’re single and can not designate a family member, other than a wife or husband to leave it to.
Before you leave the T, make sure you and the spouse know the % & $$ annuity payout. What it will be when you both retire and what it will be when one partner dies and the other begins receiving those payments.....no one likes surprises. Talk with HR and ask questions, a lot of them.
From the people I have talked to your lump sum would have to make about 6%, very hard to do, without a lot of risk. Do the math yourself, with your own lump sum, and what your pension would be.
Correct it impacts the lump sum ...would prefer to take the lump versus an annuity. Financial planner can invest and do better than att annuity (I hope). But it could impact the lump negatively by thousands $$$
I thought the interest rate only affected the lump sum payout; not the pension annuity.