PENSION 2019

New pension begins in 2020 and is not based on years of service. 10% of pay only

 

what is the estimated annual return for the cash balance

 

it depends on your age and years of service. A new employee would be 6.5%. Anyone with age plus years of service 70 or over would be 10%. It is better than nothing but really screws over the older tenured employees who are still working.

 

$3 mil should be fine

 

alittle over 5%

 

Have $2.8 mil, close to retirement but in HCOL. Will have to ration meds to survive since Merck cut retiree healthcare.

 

Bears

 

Walked out of Merck with 3.2 mil plus 2 mil in 401k after 30years. Only 55 and moving on to Biotech. Great company and benefits.

 

Suck!

 

I call BS on the 3.2m and 1.5 pension. What was your contribution rate to 401k and what was your salary. If you really have that balance then don’t be afraid to share the specifics.

 

Stop hating the elite. You’re a big fat zero.

 

Your numbers don’t add up! If you have 1.5m in your pension after 30 years then your current salary/annual earnings are max $210k. You have to be over 50 so assume you are maxing out $25k with catch up. Now, you probably will say you are contributing after tax above the $25k. I’ll guess your going to say total contributions are 25%. Assume you do all that then your numbers don’t add up.

 

THe former plan was a defined benefit plan. Meaning you retired after a defined amount of time and were guaranteed an income for life, like an annuity. It’s back loaded intentionally because the expected rates or return on invested money rarely meets the need, especially since we are living longer. The risk to the company and the pension itself is that markets crash and companies can not afford to cover the losses. Legal changes to defined benefit plans really center around actuarial assumptions on rates of return and life tables. It started in 2005 under the pension protection act and continues to be updated periodically.
The new plan is defined contribution. Much like a 401k, the company increases contributions with age and tenure, maxing out at 10% when the two equal 70. You’re guaranteed a rate of return that is exactly inflation plus 3%. Not to fall below 3.3% and not to exceed 10%. To a financial actuary, this is a very safe rate of return thus eliminating the risk of default.
To me there are two benefits to this plan. It is risk free money so I can take bigger risks in my 401k. The other is the survivor benefit which is 100% to your spouse, heirs, or estate. The previous plan was capped at 50% (I believe).
It’s not what it used to be but it ain’t bad either.

 

Pension of 1.5 million assessment (one receives the paperwork when retired) for 34/35 years of service is correct. In the past, people could be guaranteed that pension in a lump amount atop the 401K. Many paid the max into the 401K so that is how the numbers played out. It is great to be out of the rigors of the pharma industry and all of the bs. I do not miss it for one second and my time is all my own.

 

I have been with merck in chronic care sales (or some version of that ) for 28 years. Never management. Pension is just under 1.1M now . I have contributed to 401k at a good rate and it’s at 1.2 M. Hope that gives some perspective to others who are curious.

 

I retired early this year with 30 years. I was a VP in MRL. The pension post of 3 mil is BS. The IRS governs the max salary that can be consider for pension calculation. Now if the person who is blabbing on this site was a VP then yes, they would be right to a point as there is a supplemental retirement program for VPs. I made about 2 mil on that program but the old pension was 1.7 mil. The 401k was 2.5 mil upon exiting. Ken Frazier makes the same as me regarding pension.It is capped people!

 

Merck Janitors don’t make enough dough. You’re getting laughed at on here.