Thread regarding AT&T layoffs

Roll the lump sum into IRA this way not taxed. You can start withdrawals at 59 1/2 with no penalty. To determine amount use pension calculator. I opened IRA with fidelity took about 15 minutes via phone. Then once you choose to collect pension based on your calculations just input roll into IRA. My money was transferred to IRA within a couple of weeks.

@ast- Yes you can take your lump sum roll into IRA

if you reach magic 75 (I have a year to go) and you get tossed, can you take lump sum even before 59 1/2? Serious question, I've never been told anything about it other than it is available (for now) but not "how" to do it. thanks.

In 2016, the full lump wasn't available but I was perfectly happy to take partial lump & invest it and reap the remaining annuity without the spousal option.

I figured since I am in good heath, it's best to harvest a bigger annuity payment now as the spousal remainder would be even further decimated by inflation. If I croak early, she's got the invested 50% lump. Today's dollar value is about as good is it's ever going to be. And there's the case to split your risk exposure to a single strategy as there's a lot of life and economic variables.

Be careful of annuities. Check out what Ken Fisher Investments has to say on the topic on youtube.

So far my strategy is so good. :)

a good financial planner would not suggest annuity unless he/she is in it for a heft commission. the rule of thumb to determine taking lump sum or monthly pension is that if your annual pension is less than 5% of the lump sum, then take the lump sum since at&t pension is not adjusted to inflation.

There are two other considerations when assessing lump sum vs. annuity pension. With the traditional annuity pension there is no inflation protection since AT&T does not offer COLA adjustments like many public employee pensions. Inflation will greatly diminish the buying power of the annuity pension over time. The other thing to keep in mind is that AT&T could at any time offload the pension to a private insurance company that is not backstopped by the PBGC. Verizon did this with their management pension plan several years ago.

Taking the money and run is not a wise decision. The AT&T ANNUITY is paying more than other ones being offered. My financial planner suggested partial lump sum and AT&T annuity (They are not making as much $ telling me to go part T annuity so I believe they are being honest). Putting your lump sum into the market is bad advisce as your 401k is also in the market. The market is about the percentages of win or losses you will incur the annuity is a gamble on how long you might live. Balance your odds and every investment holds risk.

I am concerned whether AT&T will be able to continue to annually fund the fidelity annuity. Even the insurance that protects it is underfunded. I heard of cases where the company made incorrect calculations and the retiree was asked to reimburse the substantial overpayment while on a fixed income. I love the idea of having a reliable income but not sure the annuity will provide that anymore. As others have said if you and spouse die soon, you leave a lot of money on the table that will not go to your heirs. They say if you will live 15 more years, the annuity would be better but that is not taking into account the health of AT&T with all that debt and also not taking into account if you can find a good financial vehicle to provide reliable income.

"Keep in mind you can purchase an annuity from your lump sum payout... you don’t have to keep it with The DeathStar"

The returns from a purchased annuity will come nowhere close to matching the returns the annuity the Death Star offers up.

Do your homework by doing a stare-and-compare.

I have found it is far safer the take the money and run(rolling it over into a IRA or similar). You never know what will happen to the pension payout over time, especially at the rate that ATT is incurring DEBT. If their 5G fails, FirstNet falters, and the Video business disintegrates, do you really think they will keep the counterparty risk that is the outdated pension for employees at the same level?

The annuity is attractive if you live longer , let’s remember there are no guarantees on longevity. example: 40 years gives you lets say about $3, 000 a month , intrest rates went up in 2018 so the lump payout is about 10% to 15% % less for retirees in 2019 , lets say $450 -$500 , if you invest that in an IRA you can take distributions using the 4% rule you will receive about $1500 mo. but if you couple that with another $400,000 from a 401k you can receive the 3K a month and still have close to a million in ten years maybe more if you invest carefully, some people have less money than that hopefully you all have more money saved.

I took the lump sum last Sept and when I looked at things I only need to average 4.5% to equal the pension I would have received. If I would have chosen the monthly pension I would have picked the 100% survivor for my wife. But the thing I like about the lump sum is we can will it to our daughter. It is very easy to average 4.5% with historical growths and I have mine with some moderate stocks that pay pretty good dividends.

For those that have retired you can talk to a financial planner or use Fidelity. With fidelity you can chose to put some of your money in Brokerage link to get better plans or stocks that wasn't available with the 401k. Just my opinion though.

Keep in mind you can purchase an annuity from your lump sum payout... you don’t have to keep it with The DeathStar

@bzx, well said and you’re making a valid point. Our Fidelity CFP suggested the Annuity long before we ever asked. No kids, good health...it’s not right for everyone and a larger family brings about a different set of rules, but it will work for us.

And it will be one less investment worry and hassle if the market decides to go on tilt. Interest rates have almost no affect, if any, on Annuities. Having two Social Security checks and the Pension Annuity funding our retirement will be a comfort.

For the rest of you, each to your own needs

@bzx You couldn’t be more incorrect. MOST of the time (not all), you’re far better off taking the lump sum benefit, investing it in an IRA with some diversified mutual funds and generating your own income from that.

If you look at the numbers, you will receive a much greater benefit if you take the traditional pension, instead of the lump-sum. Unless you don't expect to live long, the annuity is the better option.

AT&T encourages the lump-sum to get the pension liability off of its books.

And financial planners encourage the lump-sum so that they can manage it for you and charge you fees.

No, this info was sent out by ATO President. It had pension Q & A attached in a link. After 4/1 pension start date it will be based on lower multiple to reduce the CB amount 7-12K for every 100K. (This is only for Legacy SBC and Legacy T). Real Nice...............

The short answer is, no.