AT&T along with its biggest market competitor Verizon have been especially highlighted as companies that could potentially incur pension losses due to the market tum downturn in late 2018 because of the way they account for fluctuations in their pension plans. More on this is in the article in the link.
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For additional thoughts on this matter review the following:
https://www.thebalance.com/when-to-start-your-pension-2388767
https://www.thebalance.com/how-to-compare-pension-options-lump-sum-or-annuity-2388838
Keep in mind a Lump sum may benefit those expecting a short life expectancy and/or have heirs to consider in their estate planning. Also understand the money is yours to manage for the rest of your living days and market downturns in parallel with withdrawals during the same period can have significant impact in your retirement portfolio.
If you are laid off, take that money and put it in an IRA. If something happens to you, your spouse will not be able to collect the lump sum, and will only get 50% of the monthly payment.
The statement by efl is completely factual. No issues with the pension fund. Regarding the lump sum; you will have to get about a six percent return on your investment to equal the monthly annuity. That is VERY hard to achieve on a continual basis. The plus side of the lump sum is that the money is yours to with as you please. Look at both sides of the picture, stay diversified. Your 401K will be invested. You may not want everything in the stock market.
To end the funding claim repeated on this blog/board. - No participant in any PBGC covered Pension Plan can get a Cash Balance payout if the plan funding level is below 80% per the Pension Protection Act of 2006. AT&T continues to payout millions to retiring employees that request the cash balance method of payment.
From The IRS Filing that AT&T is required to make yearly for the Pension Plan. I would imagine the wireless tracking stock is included here. I hope just because it says 75% in a news article someone might fact check it before you post it as fact. The Intern that wrote the article might not have passed math class.
Funding Target Attainment Percentage
2017 96.5%
2016 98.5%
2015 98.7%
Single-Employer Program Continues to Improve
PBGC’s Single-Employer Insurance Program covers about 28 million participants in more than 22,000 plans. Last year’s report projected the program could potentially emerge from deficit by FY 2018 and was likely to emerge by FY 2022. The program forecasts have improved, with a larger chance of emerging from deficit by FY 2018 and emergence likely by FY 2019. The projections for FY 2027 show a wide range of potential outcomes, including the possibility for future deficits that could range in excess of $100 billion, but with an average positive FY 2027 net position of $26 billion in future dollars ($20 billion in today’s dollars). Improvements in the program’s financial position over the 10-year period are due to the general trend of better funding of pension plans and projected PBGC premiums exceeding projected claims.
AT&T PENSION BENEFIT PLAN AT&T Inc. 431301883 903-910-4201 Single-employer
take our money and run......................Knowing AT&T they will figure some obscured and borderline illegal maneuver to get some of your pile of money, LOL
Take your money from any IRA where ATT has, or had access, and run.
If ATT finds that you have got a job in the industry after you were laid off.... say TMO or Sprint or whoever is a "competitor" in a way or another, they may and will come after any money which might be paid as severance. It will be embedded in your exit papers, which you will have to sign in an extremely short time. They can go and raid your pension or 401k if they want to.
Again, read the papers before signing if you were "randomly" selected.
With the layers and money they have, you ain't got a chance.
Link to article that works: https://outline.com/sBCCkN
This isn't news all these older blue chip companies have massive underfunded pension obligations. Just wait five more years when all the retirees.start getting pension haircut's.
I was a 37 year tech. If I took my working monthly pay out of my pension each month it would last at 0% interest for 10 years. Yea, I watch the markets, but it's all my $$$ now, not relegated to pension fund levels and will never be cut or go to the PGBC. I'd have to live for 17 more years to break if I took the annuity. Take the lump, the insurance, and walk away.
OP, I wasn’t able to read the full article since I don’t have WSJ membership.
I took the lump sum as well and just have doubts about AT&T. Who knows exactly what the best choice is but I decided to take the lump sum.
That's exactly why I flipped mine into a separate 401 k NOT controlled by the company.
The 2018 Pension just hit your NetBenefits today. You can log in to see the 2018 Pension contribution paid by T.
OP here. Sorry, forgot to post the link with the article on this, so I'm posting it here in the reply
https://www.wsj.com/articles/pension-losses-could-hit-companies-like-at-t-and-verizon-hard-11548428400
Exactly why I took my lump sum. Cut all financial ties with AT&T.