Ex Warner Lambert/Reports of Lump Sum Pension

There are former Warner Lambert colleagues reporting they have received letters offering a lump sum buyout of their pensions currently only available as a monthly annuity. The letter states no "number" will be available until July 10,2015. All WL folks who have received the letter please reply. Are you already retired? Did all former WL employees receive or only those who have not yet begun taking their pension? All details helpful. Hope it's not bogus.

 

I got mine it's a major rip off.

 

I haven't received any letter. I've been retired 3 years. Will call Fidelity.

 

former wyeth layed off 1 1/2 yrs ago and under 55 years old. got notice of lumpsum payout a couple of weeks ago. don't know if its for both wyeth and pfizer pensions (wyeth pension had lumpsum provision when you hit 55 years old)

 

Thanks Wyeth Poster. WL never had a lump sum option. I called HR / Fidelity today and was told it IS occurring in waves. However, there are "eligibility and date of separation" requirements. The window when offers may be accepted is July 15 and if you do not receive a letter, you can call to get specific info on your personal eligibility. I have not received a letter and I am fully retired and receiving the monthly lump sum. Since the plan is to shut down the PFE pension by 2017, perhaps they are making offers to all to get the reserve off the books?

 

Here's a good website to calculate what a good buyout offer should be based on your personal profile:

https://www.pensionbenefits.com/calculators/cal_main.jsp?sub_item=lumpsum_cal

 

Nice website but how does one determine the actuarial formulas?

 

I didn't put in an age setback but just used the drop down menu for the 2015 Mortality table. The "number" I received was about 56% of what I would receive by multiplying my monthly pension benefit X12 X 25 (to calculate what I would receive for 25 years.) To make up for what you give up in monthly payments, you will need to earn at least 5% a year. If you earn 4% a year on the lump sum while drawing the same amount monthly, it will last approx 21 years. However, if we don't live long enough to collect for 25 years.....well that's why the lump sum is generally a smarter move for family and estate planning purposes. Then we just need to find the right allocation of investments to earn at least 5% and hope there is not another 2008!!

 

You're welcome moron.

 

It is only for those who have not started collecting their pension. I am 58 and was going to collect at age 60. There are 5 options. Take a cash payout lump sum. Take the lump sum rolled into a personal IRA. Take a lump sum and deposit into the Pfizer savings plan if you still have an account open. Take your pension now and start collecting or do nothing and collect your pension at a future date.

 

Looks like interest rates are heading up. Two years from now your lump sum will probably be a lot smaller. May want to rethink waiting two more years.

 

This issue was beaten to death on another thread awhile ago. Actually, it was a very interesting and informative discussion. There are advantages to both. Certainly this isn't the place to get a definitive answer to the question because there are so many variables. Your accountant/ financial advisor is the one to talk to, not the "experts" here.

One simple rule of thumb my advisor gave me that has held true is that if you can make 5-6% return on your lump, then you are equal to or better off than taking the pension. It has worked for me.
Either way you go, there are risks, but life is a risk. Many of my group walked away with 500-1M and there was no way We were going to let Pfizer be in charge of our retirement. HR Connect is a joke.

 

I'm a current WL retiree receiving a pension. Remember the WL amount you are due does not increase or change -- EVER -- with regard to the amount you will receive as an annuity. It was a fixed amount effective December 2011. So, the minute you are eligible to take your pension do it. Every month you don't sign up you are leaving money on the table. It is not subject to the same rules as the Pfizer pension.

 

Considering you are at least 62.......

 

My valuation in two years…. 30-40% less than today's value. unless you enjoy working for free, punch out now.

 

Annuities are for suckers.

 

agreed, they are giving you back your own money!!

 

Former legacy Pfizer employee. Received the letter too about the pension buyouts in July 2015. If they pay based on the wording in the plan summary they will use the GATT_2003 (1994 GAR) and the segmented rates two months prior to the lump sum calculation.

It that is the case and we are given numbers in July then they are using May's numbers which are: First Segment Interest Rate 1.38%, Second Segment Interest Rate 3.88%, Third Segment Interest Rate 4.98%.
There is a calculator on https://www.pensionbenefits.com.

I used the PPA 2006 Lump Sum Value Calculator. If they use that as the calculation based on my scenario my Lump Sum = 83,186.20.

My case is $1025 pension per month at 65 in 2027. I am currently 53 and I worked for Pfizer for 11 years.

 

I would not wait until 65. Companies do what is best for them so you can figure that out.

 

Ex WL colleague here. Lost my job in 2007. Was with WL/Pfizer for over 20 years.

I'm only 53 and single. No dependents. According to the pamphlet, if I took the Lump Sum (Option 3), I may get hit with tax penalties for taking retirement benefits early. Might not be worth that.

I'm still working, so I do not need this money now to start collecting the pension now (Option 4), and I'd probably be penalized for drawing on my pension early.

Not sure I trust that the pension will be around to collect later (Option 5).

So, I'm leaning towards Option 1, rolling it into an IRA. Question ... is there any way to roll this money over to an existing Roth? I remember that with my 2007 severance, I was not able to roll my 401K into a Roth, so I'm thinking it would be the same here and it would be a Traditional IRA? I'd hate to get hit with paying taxes later when I'd need the money most, so a Roth would be the better option if available.