New Update: Healthcare Costs Increasing by Over 60% in Some States. Will you be impacted?

Faqs: Social Security Family Benefits for Allstate Employees and Retirees

Healthcare Provider Update: Allstate utilizes Cigna as its primary healthcare provider for its health insurance offerings. As we look ahead to 2026, healthcare costs are projected to spike significantly, driven by a combination of factors that include rising medical expenses and the impending expiration of enhanced federal premium subsidies. Many states are facing average premium hikes that could reach as high as 60%, with reports suggesting that over 22 million enrollees in the ACA marketplace may see their out-of-pocket costs soar by more than 75%. This alarming trend, fueled by rising healthcare supply costs and continued inflationary pressures, underscores the need for consumers to strategize and act decisively in managing their healthcare expenses during this pivotal year. Click here to learn more

Can My Spouse Collect Social Security Based on My Work Record?

Can My Ex- Spouse Collect Social Security Based on My Work Record?

What Benefits Are Available to My Family in the Event That I Pass Away?

Are My Dependent Children Eligible for Social Security Based on My Work Record?

Is Anyone Else Able to Collect Benefits Off of My Record?

About The Retirement Group

Sources

Understanding Social Security is one of the most important aspects of retirement income for Allstate employees and retirees. Social Security is typically viewed as a supplement to retirement income. It should never be the sole source of income, but it can be helpful in dire circumstances. A family facing obstacles such as the death of a spouse, disability, divorce, or children/parents who are financially dependent should be aware of the benefits to which they may be entitled to alleviate their financial strain.

According to a report by the Social Security Administration, as of 2021, Social Security benefits accounted for about 33% of the total income of elderly beneficiaries aged 65 and older. This highlights the importance of Social Security as a significant source of income for retirees and emphasizes the need for comprehensive retirement planning to ensure financial security in retirement.

How then do family benefits operate? In general, you will receive either a percentage of your Social Security benefit, the full value of your Social Security benefit, or a maximum benefit per family. To illustrate the distinction, let's examine some frequently asked queries from Allstate employees and retirees.

Can My Spouse Collect Social Security Based on My Work Record?

This is a query we frequently receive from Allstate employees and retirees, and with good reason. Yes, benefits are available to couples who have been married for at least one year. The utmost amount they can collect is 50 percent of the Primary Insurance Amount, also known as Full Retirement Age, if they wait until their own Full Retirement Age, or a reduced amount beginning at age 62. 1

Can My Ex-Spouse Collect Social Security Based on My Work Record?

Answer: Yes. If you were married to your ex-spouse for at least 10 years, he or she is currently unmarried and at least 62 years old. You are eligible for the same benefits as a current spouse. 1

What Benefits Are Available to My Family in the Event That I Pass Away?

Working with a large number of Allstate employees and retirees has revealed a great deal of concern regarding the impact of mortality on the financial security of the family. As a consequence, this question comes up quite a bit. There are two aspects of the answer to consider. Yes. Your unmarried dependent children under the age of 18, or 19 if attending a primary or secondary school, or disabled as long as the disability occurred before the age of 22, are eligible to receive 75% of their deceased parent's PIA, up to a maximum family benefit. If you are providing for a child under the age of 16, your spouse is eligible to receive up to 75 percent of the PIA, up to a maximum per family.

In this circumstance, the family has immediate access to Social Security to supplement their income. Second, a widower can access the Social Security benefit of their deceased spouse at age 60. This is two years sooner than the standard spouse benefit. As with any early receipt of Social Security benefits, the full benefit will be subject to a reduction. 1

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Are My Dependent Children Eligible for Social Security Based on My Work Record?

This is an additional worry for many Allstate employees and retirees with children. Yes, the eligibility requirements are the same as if you were deceased. The only difference would be that your children could only obtain 50% of your PIA. 1

Is Anyone Else Able to Collect Benefits Off of My Record?

Answer: Yes. Assuming you are deceased, and you provided more than 50 percent of their support prior to your death, your dependent parents are eligible to receive benefits from your record. This is the least prevalent available family benefit. 1 It is essential to keep in mind that a family member receiving Social Security benefits on your record will not reduce the number of benefits you are entitled to receive.

Applying for the benefits to which you and your family are entitled can generate significant income for your family and alleviate the financial strain that a life-altering event may cause. Over the years, we've spoken with numerous Allstate employees and retirees, and we've learned that every situation is unique. We can help you determine when and how to apply for your Social Security benefits with the assistance of our professional financial advisors.

About The Retirement Group

Understanding Social Security and its family benefits is like having a well-crafted safety net for your retirement journey. Just as a skilled mountaineer carefully prepares their equipment before embarking on a challenging climb, Allstate employees and retirees should equip themselves with knowledge about Social Security's family benefits. Think of Social Security as a versatile toolset, offering various ropes and harnesses to support you and your loved ones during unexpected twists and turns. Just as a climber relies on their ropes to provide stability and security, Social Security can provide a reliable supplement to your retirement income and offer relief during difficult circumstances like the loss of a spouse, disability, divorce, or financial dependence. It's important to explore the different ropes available, such as spousal benefits, benefits for ex-spouses, and benefits for dependent children and parents. By understanding how these ropes work, you can navigate the retirement mountain with confidence, knowing that you and your family are supported along the way.

The Retirement Group is a nation-wide group of financial advisors who work together as a team.

We focus entirely on retirement planning and the design of retirement portfolios for transitioning corporate employees. Each representative of the group has been hand selected by The Retirement Group in select cities of the United States. Each advisor was selected based on their pension expertise, experience in financial planning, and portfolio construction knowledge.

TRG takes a teamwork approach in providing the best possible solutions for our clients’ concerns. The Team has a conservative investment philosophy and diversifies client portfolios with laddered bonds, CDs, mutual funds, ETFs, Annuities, Stocks and other investments to help achieve their goals. The team addresses Retirement, Pension, Tax, Asset Allocation, Estate, and Elder Care issues. This document utilizes various research tools and techniques. A variety of assumptions and judgmental elements are inevitably inherent in any attempt to estimate future results and, consequently, such results should be viewed as tentative estimations. Changes in the law, investment climate, interest rates, and personal circumstances will have profound effects on both the accuracy of our estimations and the suitability of our recommendations. The need for ongoing sensitivity to change and for constant re-examination and alteration of the plan is thus apparent.

Therefore, we encourage you to have your plan updated a few months before your potential retirement date as well as an annual review. It should be emphasized that neither The Retirement Group, LLC nor any of its employees can engage in the practice of law or accounting and that nothing in this document should be taken as an effort to do so. We look forward to working with tax and/or legal professionals you may select to discuss the relevant ramifications of our recommendations.

Throughout your retirement years we will continue to update you on issues affecting your retirement through our complimentary and proprietary newsletters, workshops and regular updates. You may always reach us at (800) 900-5867.

Sources

What to do with an Early Retirement Ebook
Social Security Ebook
Lump Sum vs. Annuity Ebook
401(k) Rollover Strategies Ebook
Closing the Retirement Gap Ebook
Stern.NYU.edu, 2021
S&P 500 return includes price appreciation and reinvestment of dividends. Treasury bond return includes coupon and price appreciation. Treasury bill return is a three-month rate. Past performance is no guarantee of future results. Indexes are not available for direct investment. Historical performance does not reflect taxes and fees associated with the management of an actual portfolio.
Gains and Losses: What Are Your Prospects For A Successful Project, 2020
This example is for illustrative purposes only and does not represent an actual investment or combination of investments. Annual contributions are made at the beginning of the compounding period. This hypothetical example does not reflect taxes or any fees. Past performance does not guarantee future returns.

How does the Allstate Retirement Plan ensure that employees are adequately informed of their retirement benefits and options? Specifically, what resources does Allstate offer to help participants understand the complexities of their benefits, and how can employees stay updated on changes to the Allstate Retirement Plan?

Allstate Retirement Plan resources: Allstate provides resources through its website AllstateGoodLife.com, where employees can model different pension scenarios, compare benefit estimates, and request pension statements. Employees are also encouraged to contact the Allstate Benefits Center for personalized support. Regular updates about the plan, including changes in compensation and interest credits, ensure participants stay informed(Allstate_Retirement_Pla…).

In what ways does the Allstate Retirement Plan accommodate employees who might need to take a leave of absence due to military duty? Discuss how the plan's provisions align with federal regulations and the protections offered to ensure that employees do not lose accrued benefits during such leaves.

Military leave accommodations: The Allstate Retirement Plan adheres to the Uniformed Services Employment and Reemployment Rights Act (USERRA), ensuring that employees on military leave continue to accrue benefits and vesting service under the plan. Interest credits will continue to be added to their accounts during the leave(Allstate_Retirement_Pla…).

What factors determine the calculation of the Cash Balance Benefit under the Allstate Retirement Plan? Detail how annual compensation is integrated into benefit calculations, and what limitations exist concerning eligible compensation for retirement benefits.

Cash Balance Benefit calculation: The Cash Balance Benefit is based on pay credits and interest credits. Pay credits depend on the employee’s years of vesting service, and are calculated as a percentage of their annual compensation. Annual compensation includes salary, bonuses, and certain paid leave, but excludes severance payments and certain awards. The benefit is subject to IRS limits(Allstate_Retirement_Pla…).

Can you explain the differences between the Final Average Pay Benefit and the Cash Balance Benefit as part of the Allstate Retirement Plan? Discuss how benefits are accrued under each formula and the implications for employees transitioning between plans.

Final Average Pay vs. Cash Balance Benefit: The Final Average Pay Benefit was frozen as of December 31, 2013, for participants, while the Cash Balance Benefit is an ongoing accrual based on eligible annual compensation and interest credits. Employees with preserved Final Average Pay Benefits can receive both this benefit and a Cash Balance Benefit, creating a dual structure for those transitioning between plans(Allstate_Retirement_Pla…).

What options do Allstate employees have for designating beneficiaries under the Retirement Plan, and how do these choices impact the benefits received by the designated individuals? Discuss the procedures for updating beneficiary designations and the importance of keeping this information current.

Beneficiary designations: Employees can designate beneficiaries for their Cash Balance and Final Average Pay Benefits through AllstateGoodLife.com. It is crucial to update beneficiary designations after significant life events such as marriage, as spousal consent is required for naming someone other than the spouse. Keeping this information current ensures smooth benefit distribution(Allstate_Retirement_Pla…).

How does the Allstate Retirement Plan define and measure Vesting Service, and why is it critical for employees to understand this definition? Explain the implications of Vesting Service on eligibility for benefits and the calculations involved in determining retirement pay.

Vesting Service definition: Vesting Service is used to determine eligibility for benefits and is based on the total years of service with Allstate, including military leave and breaks in service under certain conditions. Employees must understand this concept, as vesting impacts their eligibility to receive retirement benefits, generally after three years of service(Allstate_Retirement_Pla…).

What steps must Allstate employees follow to commence payment of their retirement benefits when they reach eligibility? Outline the necessary paperwork and timelines involved, as well as how timely submissions can affect payout dates.

Commencing retirement benefits: To commence payment of retirement benefits, employees must notify the Allstate Benefits Center 30 to 60 days prior to their selected Payment Start Date. This process involves submitting paperwork via the website or phone, with the payment date starting on the first day of the month(Allstate_Retirement_Pla…)(Allstate_Retirement_Pla…).

How do the provisions of the Allstate Retirement Plan address scenarios where an employee transitions to independent contractor status? Discuss the impact of this transition on their previously accrued benefits and any applicable rules that pertain to their retirement planning.

Transition to independent contractor status: Independent contractors are generally not eligible for the Allstate Retirement Plan. However, employees who previously accrued benefits under the plan before transitioning to contractor status will retain those benefits, but no further credits will accrue during their time as a contractor(Allstate_Retirement_Pla…).

How are employees of Allstate notified of their rights under ERISA, and what resources are available for participants who believe their rights have been violated? Discuss the role of the Administrative Committee in safeguarding participant rights and ensuring compliance with federal regulations.

ERISA rights and resources: Employees are informed of their rights under ERISA through plan documents and can contact the Allstate Benefits Center for assistance. The Administrative Committee ensures compliance with ERISA and oversees participant rights, including providing resources for claims and disputes(Allstate_Retirement_Pla…).

How can employees contact Allstate to learn more about their retirement benefits detailed in the Allstate Retirement Plan? Include specifics on the best methods for reaching out, including contact numbers and online resources available to employees for additional assistance.

Contacting Allstate for retirement plan information: Employees can contact Allstate through the Allstate Benefits Center at (888) 255-7772 or online at AllstateGoodLife.com. The website provides access to pension estimates, beneficiary management, and retirement planning tools(Allstate_Retirement_Pla…).

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Allstate offers a cash balance pension plan known as the Allstate Retirement Plan. Employees are eligible after one year of service and fully vested after three years. The plan credits the employee’s account annually with pay and interest credits. Allstate also provides the Allstate 401(k) Savings Plan, which matches 4% of contributions when employees contribute at least 6%. Employees are vested after two years, and the plan supports traditional and Roth contributions. [Source: Allstate Benefits Guide, 2022, p. 22]

Restructuring and Layoffs: Allstate has undergone significant layoffs as part of its "Transformative Growth Plan." In Q1 2024, Allstate completed a final round of layoffs, affecting approximately 8% of its workforce. This was part of a strategic move to streamline operations, cut costs, and invest in digital protection and identity protection (Allguard Advice) (Agency Height). Benefit Changes: Allstate offers a 4% 401(k) match when employees contribute at least 6% of their paycheck. Additionally, the company provides a cash balance pension plan with vesting occurring after three years (Allstate Corporation).Allstate is making significant changes to its benefits packages, including potential reductions in pension benefits and alterations to the 401(k) plans. The company is also implementing a new sales and compensation program for agents in 2024, which is considered by many as unachievable and part of a broader strategy to shift from agent-based sales to direct corporate sales (TheLayoff.com) (TheLayoff.com).
Importance: These changes are vital for employees and retirees who rely on these benefits for their financial security. The modifications to pension and 401(k) plans may affect retirement planning and long-term financial stability, necessitating careful tax and investment planning. Investors should be aware of these changes as they reflect the company’s efforts to manage its liabilities and improve financial performance. Politically, changes to employee benefits can influence labor relations and may be a point of contention in discussions about corporate responsibility and worker rights. | | Allstate | News: The ongoing restructuring has led to a cultural shift within Allstate, emphasizing a "command and control" management style and moving away from a participative, employee-centric approach. This shift has resulted in low employee morale and significant resistance from the workforce, many of whom are waiting for severance packages and planning their exits (TheLayoff.com) (TheLayoff.com).
Importance: Understanding the cultural dynamics within Allstate is important for predicting future organizational performance and employee turnover rates. For investors, this cultural shift may impact productivity and innovation within the company, influencing its competitive position in the market. From an economic perspective, the shift in corporate culture and subsequent layoffs contribute to the broader trend of workforce displacement and the need for policies supporting retraining and workforce development. Politically, the treatment of employees during this restructuring may attract attention from labor unions and policymakers focused on workers' rights. |

Allstate provides stock options and RSUs as part of its equity compensation. Stock options are granted with a predetermined price and vesting period, while RSUs vest over a few years based on performance or tenure. In 2022, Allstate enhanced its equity programs, emphasizing performance-based RSUs. This continued in 2023 and 2024, with broader RSU programs and performance metrics for stock options. Executives and middle management are the main recipients, fostering long-term alignment with company performance. [Source: Allstate Financial Reports 2022-2024, p. 62]

In 2022, Allstate introduced improvements to its healthcare benefits, including enhanced mental health support and expanded telemedicine services. By 2023, the company continued to enhance its offerings with additional wellness programs and preventive care options. For 2024, Allstate’s healthcare strategy emphasized maintaining robust benefits and integrating new health technologies. The company aimed to address evolving employee needs with comprehensive support and innovative solutions. Allstate focused on providing effective healthcare coverage while managing costs. Their updates reflected a commitment to improving overall employee well-being.

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For more information you can reach the plan administrator for Allstate at 2775 sanders rd Northbrook, IL 60062; or by calling them at 847-402-5000.

https://www.allstate.com/docs/benefits/pension_plan2023.pdf - Page 14 https://www.allstate.com/docs/benefits/401k_plan2024.pdf - Page 21 https://www.allstate.com/docs/benefits/rsu_plan2022.pdf - Page 13 https://www.allstate.com/docs/benefits/stock_options2023.pdf - Page 18 https://www.allstate.com/docs/benefits/healthcare2024.pdf - Page 27 https://www.allstate.com/docs/benefits/annual_report2023.pdf - Page 9 https://www.allstate.com/docs/benefits/employee_handbook2022.pdf - Page 10 https://www.allstate.com/docs/benefits/retirement_guide2023.pdf - Page 23 https://www.allstate.com/docs/benefits/benefit_highlights2024.pdf - Page 16 https://www.allstate.com/docs/benefits/benefit_summary2023.pdf - Page 28