Getting laid off - Pension??

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anonymous

Guest
Hi,

If I take lump sum after 20 years, roll into my 401k, do taxes get paid by me right away? ER said check will be about $475k

Serious replies no complainers. We have all been so lucky to have these jobs this long.
 












anonymous said:
Hi,

If I take lump sum after 20 years, roll into my 401k, do taxes get paid by me right away? ER said check will be about $475k

Serious replies no complainers. We have all been so lucky to have these jobs this long.
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So long as you roll it you don't get taxed. You pay taxes as you withdraw the money, never have the initial check sent to you directly. Here's the kicker, unless you are 62 you won't be able to roll or touch the money. Say you are a 50 year old rep with 500k in lump sum. Whether you leave on your own OR are let go you can't roll or touch the money. If you do you will get pennies on the dollar. The money sits in Mercks pension account the you can roll it when you are 62. You can roll it a bit early at a reduced rate, say 60 years old. Anything before that you won't see much.
 








anonymous said:
So, it may not even be there when I'm 62 if merck goes belly up right?
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Correct, but it is well funded, Merck cannot touch the retirement funds say for R & D, acquisitions,etc.

If you are 50 years old with 500k I would leave it alone. Now, if you are in dire straits and about to lose your house you can take it. However, as the other poster mentioned, the check will be very small. Better to draft off your 401k if you need money. I'm in the same situation my friend, good luck.
 








anonymous said:
Hi,

If I take lump sum after 20 years, roll into my 401k, do taxes get paid by me right away? ER said check will be about $475k

Serious replies no complainers. We have all been so lucky to have these jobs this long.
Click to expand...

I did this a couple of years ago. You can transfer your pension from Merck to a brokerage, bank or other financial institution. At this point it becomes an IRA. You have 100% control of this IRA. In the future as you make withdrawals assuming you are 59 and 1/2, the amount you withdraw will become taxable. Lets say you have 500K as the total and you want to withdraw 30K in a year. The 30K will become taxable. As long as you keep the funs in an IRA you will not pay taxes until you draw funds. Good luck to you!
 




anonymous said:
I did this a couple of years ago. You can transfer your pension from Merck to a brokerage, bank or other financial institution. At this point it becomes an IRA. You have 100% control of this IRA. In the future as you make withdrawals assuming you are 59 and 1/2, the amount you withdraw will become taxable. Lets say you have 500K as the total and you want to withdraw 30K in a year. The 30K will become taxable. As long as you keep the funs in an IRA you will not pay taxes until you draw funds. Good luck to you!
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How old were you when you did this? I'm 45 with 20 years in. If I leave now can I also take my pension lump and transfer it to an IRA or do I have to wait until a certain age? Thank you!
 




it really pays to talk to a financial planner. its worth the 250 an hour 10 times over. get your questions answered.HR is giving all sorts of shit advice that is frankly incorrect.
 




anonymous said:
How old were you when you did this? I'm 45 with 20 years in. If I leave now can I also take my pension lump and transfer it to an IRA or do I have to wait until a certain age? Thank you!
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I was in my late 50s when this happened. I believe there is a minimum age required when you are separated or leave Merck to obtain the pension as a lump sum. It might be 55. If you are under a specific age your only option is the monthly check. You can find this out by researching the pension modeling website. Call their 800 number to discuss this point.
 




anonymous said:
...Here's the kicker, unless you are 62 you won't be able to roll or touch the money. Say you are a 50 year old rep with 500k in lump sum. Whether you leave on your own OR are let go you can't roll or touch the money. If you do you will get pennies on the dollar. The money sits in Mercks pension account the you can roll it when you are 62. You can roll it a bit early at a reduced rate, say 60 years old. Anything before that you won't see much.
Click to expand...

Wrong. I was bridged at 49 in 2011. Waited until I turned 55 in 2016. First day of the next month after turning 55, I started the paperwork to get MY pension $ out of Momma MRK's hands. Did the calculations with my financial planner and found I could do better investing the money myself than leaving it with Mother. Got my money a few weeks later and rolled it into my own retirement account. I had also rolled out my 401k immediately after being forcibly retired. My nest egg is now free and clear of MRK and I sleep better and happier each night for it. After Momma made the retiree healthcare worse, dropped dental coverage, and just this year dropped retirees from being able to match charitable donations through the Merck Foundation, I'm glad I didn't wait for her to screw me any more.
 




anonymous said:
Wrong. I was bridged at 49 in 2011. Waited until I turned 55 in 2016. First day of the next month after turning 55, I started the paperwork to get MY pension $ out of Momma MRK's hands. Did the calculations with my financial planner and found I could do better investing the money myself than leaving it with Mother. Got my money a few weeks later and rolled it into my own retirement account. I had also rolled out my 401k immediately after being forcibly retired. My nest egg is now free and clear of MRK and I sleep better and happier each night for it. After Momma made the retiree healthcare worse, dropped dental coverage, and just this year dropped retirees from being able to match charitable donations through the Merck Foundation, I'm glad I didn't wait for her to screw me any more.
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you were smart....I did the same thing at 55...Sure, I got a smaller sum than if I would have waited until
62, but no way was I going to let Mother Merck screw me again...I invested it with my brokerage and
I have it and am in control of it
 




anonymous said:
Wrong. I was bridged at 49 in 2011. Waited until I turned 55 in 2016. First day of the next month after turning 55, I started the paperwork to get MY pension $ out of Momma MRK's hands. Did the calculations with my financial planner and found I could do better investing the money myself than leaving it with Mother. Got my money a few weeks later and rolled it into my own retirement account. I had also rolled out my 401k immediately after being forcibly retired. My nest egg is now free and clear of MRK and I sleep better and happier each night for it. After Momma made the retiree healthcare worse, dropped dental coverage, and just this year dropped retirees from being able to match charitable donations through the Merck Foundation, I'm glad I didn't wait for her to screw me any more.
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This was true THEN, for reps NOW the bridge age has changed. Many younger reps under 50 have 20-25 years in. The so called bridge has been extended and repaved so no bridge fo yu. You cannot touch your lump until 62. If you do you will get pennies on the dollar.
I am glad some of these posters took the money and ran when they could.
 




anonymous said:
This was true THEN, for reps NOW the bridge age has changed. Many younger reps under 50 have 20-25 years in. The so called bridge has been extended and repaved so no bridge fo yu. You cannot touch your lump until 62. If you do you will get pennies on the dollar.
I am glad some of these posters took the money and ran when they could.
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Poster #12 here. I was under the impression that the 'age 55' was a federal tax rule, not a MRK rule. I was able to roll my pension out of MRK into a qualified personal retirement plan without any tax implications, and my investment strategy should return to me more than if I had left it with Mother until 62. Either way, yes I can't touch it for several years; but I was able to get it away from Mother's clutches.
If what you say is true, it's just another example of Mother screwing its employees (former + current) and I am so glad that I am free and clear of her.
 












I was separated in 2014. I had 15 years with the company and had just turned 50. I was bridged to retirement which means I got the 5 years credit for a 20 year pension. I have not spoken with the company that manages the pension since 2014, but my understanding is that at the age of 55 I can take my lump sum payout. It will be less at 55 vs. waiting till 62, but the difference is 3% per year. Most financial advisors will tell you that you are better off to take the hit and take the money early because if you are a good investor then you will do better than the 3% per year loss. This information came directly from the company that manages the pension vs Merck HR.
 




Age is irrelevant as long as you roll into an IRA. I quit on my own a few years ago and my Merck 401k and pension lump sum are both snug as a bug in a rug in an IRA elsewhere. Oh and I was in my 30s when I left. I spent 13 years there and I promise the grass is greener. Good luck to all of you!
 




The bridge for the current restructure is age+years of service must be greater than 65, and you lose 3% per year under 65 - so if you are 55, and bridge, take the pension, you lose 30%
 




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