At this point many AT&T employees have made the decision to stay with the company into 2023, despite the massive pension losses that will be incurred. Many of these people plan to work for several more years with AT&T, which they hope will make up for the loss in their lump-sum payment. However, there is a scenario which could be the worst case possible for these employees. If AT&T decides to conduct layoffs in 2023 these employees could lose their source of income AND suffer a massive hit to their lump-sum.
AT&T sent a memo to their employees in September, predicting that employees would lose about 30% on their lump-sums at the end of the year. That means if an employee has $1 million they would lose $300,000. A loss this substantial could be crippling for an employee’s retirement plans. With losses that significant, the real question is, would AT&T conduct layoffs?
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It certainly would not be the first time AT&T laid off workers, and the company has been attempting to cut spending under John Stankey. AT&T also conducted a surplus in the sales department earlier this year so they are clearly looking to reduce headcount.
Many people believe that we are heading into a recession, which is yet another reason for concern if you are an AT&T employee. Many companies have already announced layoffs, most notably Meta, Amazon, and Twitter.
It is important for AT&T employees who are planning to stay with the company in 2023 to consider this scenario. What would happen if you were laid off and lost 30% of your pension? How would that impact your retirement plan? Would you need to get another job from a new company? Would you be able to command the same income elsewhere?
All of these are considerations which AT&T employees should be aware of when making a decision on their future. If your plan is to work for 5 more years with AT&T, consider the possibility that forces beyond your control may prevent you from continuing your employment.
So, how can you prepare for this scenario? We would recommend reading searching "AT&T Retirement" on YouTube. There are some great videos which can help you plan for an abrupt job loss. One of the main tactics you should look into, is opening a line of credit against your home equity (called a HELOC). This can essentially be used as a back up plan in-case of emergency. You will not pay for the line of credit unless you actually use it. It is important to apply for the line of credit while you still have a job, as it could be much more difficult to obtain if you are unemployed.