As recruiter clients ask me all the time about their pension plan. When is the last time you checked on your AT&T pension plan? If it has been a year or two there are some things you may have missed.
As of June 1, 2018 AT&T has been giving current and former management employees the additional option to receive a full lump-sum payout. This is an excellent addition to the plan given that previously, management employees could only receive either a partial lump sum and residual monthly annuity, or a full monthly annuity.
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The full lump-sum payout option gives you the ability to receive your entire benefit as a one-time payment once you retire. You may then roll it over into an IRA and invest it in whichever way you choose.
You Are Eligible for the Full Lump-Sum If:
- You left AT&T and your last day was on or after May 31, 2018.
- The day you choose to receive your payment (commencement date) is on or after June 1, 2018.
- You have not started receiving pension payments already.
Is a Lump-Sum Right for Me and My Family?
The best part of the lump-sum is that you are in charge of how you'd like to use and invest your money, letting you use various tactics and investment tools to help protect against inflation. It also offers more beneficiary and inheritance options. However, there are some drawbacks associated with taking a full lump-sum. For example, you are exposed to market risk, and there's a greater chance of running out of money in retirement.
On the other hand, the monthly annuity payout option has its own pros and cons which should be weighed as well. The biggest advantage of the monthly annuity is it gives you a source of income for life, while also shielding you from market risk. The cons, however, are that you are not protected from inflation and, if your cost of living increases, the payments will not reflect that.
Ultimately it is up to you and your family to look at these pros and cons and make the best decision regarding your financial future.
If you are looking for more details about your benefits, reach us at TechStaffer.
If you are wanting to get a better understanding of your 401(k), visit https://techstaffer.blog/2020/01/10/have-you-looked-at-your-401k-plan-recently/
If you want to know if your eligible for your pension plan, visit https://techstaffer.blog/2020/01/08/eligible-for-your-pension-plan-here-is-how-you-calculate-it/
For more information on AT&T job postings, visit https://techstaffer.blog/2020/02/10/att-surplus-job-ideas/
Sources:
- The Retirement Group or www.theretirementgroup.com
- AT&T Non-bargained Summary Plan Description, 2019
