Navigating Sequence Risk in Retirement: Lessons and Strategies for Moog Employees

New Update: Rising Oil Costs are Affecting Retirement Plans. Will you be impacted?

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Navigating Sequence Risk in Retirement: Lessons and Strategies for Moog Employees

August 27, 2025

How Oil Volatility Affects Your Moog Retirement

Oil market turbulence continues to ripple through the broader economy, with crude swinging between $50 and $120 per barrel and annualized volatility near 80%. The broader economic effects of oil volatility, from inflation to interest rate policy to equity market sentiment, reach well beyond energy companies. Moog employees should recognize that their retirement portfolios, through index fund allocations and sector exposure, likely move with energy markets more than they realize. Retirement savings strategies at Moog should account for how energy price cycles influence inflation, interest rates, and market returns over the long horizons that retirement planning requires. Working with a financial advisor can help you position your planning strategy for sustained energy price uncertainty.

'Moog employees approaching retirement should recognize that the sequence of market returns in their early years can influence the longevity of their income far more than the average return itself, making disciplined withdrawal strategies and diversified income planning essential.' - Brent Wolf, a representative of The Retirement Group, a division of Wealth Enhancement.

'Moog employees nearing retirement can benefit from understanding how market downturns early in retirement may have lasting effects, and from adopting flexible, research-based withdrawal and allocation strategies to help sustain their income over time.' - Paul Bergeron, a representative of The Retirement Group, a division of Wealth Enhancement.

In this article we will discuss:

Historical examples of sequence-of-returns risk and their effects on retirement income.
Why the first years of retirement are most critical for portfolio sustainability.
Researchâ€‘backed strategies for managing sequence risk and supporting longâ€‘term retirement goals.

Contributed by Paul Bergeron and Brent Wolf of Wealth Enhancement

For Fortuneâ€¯500 employees approaching retirement, recognizing the timing of returns, not just the average return, can be critical to keeping income going over the long term. This concept, known as sequence-ofâ€‘returns risk, shows how poor early market performance in retirement can have a lasting impact on a withdrawal plan, even if long-term averages seem strong. Historical market data provides clear examples of this risk and offers practical methods for responding to it.

Historical examples of sequence risk

Fortuneâ€¯500 retirees entering retirement during tough market cycles face situations similar to the declines seen in the late 1960s, when the market hit two bear markets (1968-70 and 1973-74) alongside high inflation. The S&Pâ€¯500 dropped roughly 48% during the 1973-74 bear market, compounding inflation-related difficulties. ¹ Likewise, those retiring endured two severe bear markets in the decade, while 2022 proved one of the toughest years for balanced portfolios, with sharp drops in both U.S. stocks and high-quality bonds.

Why the early years matter most

For a Fortuneâ€¯500 retiree, significant losses in the first five to ten years of retirement, combined with regular withdrawals, can shrink the number of shares left to rebound when markets recover. Academic studies and industry research repeatedly show that even with the same average return, the order of gains and losses plays a huge role in retirement outcomes.

Research-backed strategies to manage sequence risk

One effective method for Fortuneâ€¯500 retirees is keeping a mix of asset types to help weather downturns. Cash and bonds can act as "shock absorbers" for immediate expenses, reducing the need to sell stocks during market dips. Flexible withdrawal approaches, such as adjusting withdrawals within set guardrails, have been shown to support portfolio longevity better than fixed-dollar withdrawal methods.

Staging risk in a retirement portfolio, by holding one to two years of expenses in cash-like assets and several years in shortâ€‘ to intermediateâ€‘term bonds, may give equities time to recover before they're tapped for income. For some Fortuneâ€¯500 retirees, delaying income sources like Social Security can help raise total lifetime income and lessen the need to tap investments during volatile times. Thoughtful rebalancing and managing tax lots, especially during downturns, can also help maintain equity exposure and extend portfolio lifespan.

Implications for retirement planning

While higher stock allocations may offer greater long-term growth potential, they also increase sequence risk in early retirement for Fortuneâ€¯500 workers. Historically, balanced portfolios, often with 30% to 50% equities for income-focused funds, have supported more resilient initial withdrawal rates compared to all-stock strategies. ² Strong early-market results can set up long-term success, but disciplined spending limits, guardrails, and rebalancing remain key.

As you plan your transition from Moog into retirement, understanding the company's benefit structure can help you make more informed decisions. According to publicly available information, Moog maintains an active defined benefit pension plan, which provides retirement income based on factors such as years of service and compensation history. Moog also offers retiree healthcare benefits to eligible employees, which can provide meaningful coverage for those who retire before reaching Medicare eligibility at age 65. Because the specifics of your pension formula, vesting schedule, and benefit eligibility depend on your individual employment history and plan documents, We encourage you to review your Summary Plan Description (SPD) or speak with Moog's HR or benefits team for the most current details.

Sources:

1.The New York Times. ' What Happens When Stock Markets Become Bears ,' by William Davis, Karl Russell, and Stephen Gandel. 13 June 2022.

Other Resources:

1. Guyton, Jonathan T., and William J. Klinger. " Decision Rules and Maximum Initial Withdrawal Rates ." Journal of Financial Planning , vol. 19, no. 3, Mar. 2006, pp. 48-50, 52-54, 56-58. Financial Planning Association.

2. " Timeline of U.S. Stock Market Crashes ." Investopedia , 30 Oct. 2024, section "The 1973-74 Oil Crisis Bear Market."

3. ' When to Start Receiving Retirement Benefits. ' Social Security Administration, Pub. No. 05-10147, May 2024, pp. 1-2.

4. Arnott, Amy C., CFA, and Ivanna Hampton. " Why More Diversification Doesn't Mean Better Returns ." Morningstar , 7 June 2024.

How does the transition from the Moog Pension Plan to the RSP(+) Program affect my retirement savings strategy, and what steps should I take to optimize my contributions in light of the changes Moog has implemented to its retirement programs?

Transition from Pension Plan to RSP(+): The transition from the Moog Pension Plan to the RSP(+) Program offers greater flexibility and portability, as the RSP(+) includes both a retirement contribution and a matching contribution. To optimize your contributions, aim for the maximum percentage of your eligible compensation to take full advantage of Moog's increasing match, which phases up to 10% by October 2021. Evaluate your long-term goals and consult a financial advisor for personalized advice.

In what scenarios would remaining in the Current Retirement Program offered by Moog provide a greater benefit compared to the new RSP(+) program, and what factors should I consider when assessing my long-term retirement goals in relation to these two options?

Benefits of Staying in the Current Program: Remaining in the Current Retirement Program may provide greater benefits for long-term employees close to retirement. The Moog Pension Plan offers a defined benefit that provides predictable, stable income, which can be beneficial if you're near retirement age or value a guaranteed income. Weigh the security of the pension against the flexibility and growth potential of the RSP(+) based on your retirement goals.

With the Moog Pension Plan being "frozen" as of December 31, 2019, how does this affect my accrued benefits, and what are the implications for my retirement planning as I approach retirement age and consider other income sources?

Frozen Moog Pension Plan Impact: Since the Moog Pension Plan was frozen on December 31, 2019, your accrued benefits will not grow, but you retain the value you’ve earned. This fixed benefit, payable as an annuity, can still play a role in your overall retirement strategy. As you approach retirement, plan for other income sources, like Social Security or RSP withdrawals, to supplement your frozen pension benefit.

What are the specific vesting timelines for the different retirement options available through Moog, and how do these timelines impact my ability to access benefits if I decide to leave the company before reaching retirement age?

Vesting Timelines: The Moog Pension Plan vests after five years of service, while the RSP(+) retirement contribution vests after three years. The RSP(+) matching contributions are immediately vested for current employees, but newly hired employees face a three-year vesting schedule. If you leave Moog before vesting, you risk losing unvested contributions, so factor in your tenure when planning your exit.

Can you explain the various payment options available when I decide to withdraw from the Moog Pension Plan or RSP(+) account, specifically discussing the benefits and drawbacks of lump-sum distributions versus annuity options offered by Moog?

Payment Options: For both the Pension Plan and RSP(+) Program, Moog offers various withdrawal options. Pension benefits are generally paid as a monthly annuity, whereas the RSP(+) offers lump sum, installments, or partial withdrawals. A lump sum offers flexibility but shifts the investment risk to you, while an annuity provides stable, lifelong payments but limits liquidity.

What investment decisions do employees have the power to make regarding their contributions to the RSP and RSP(+) at Moog, and how might these decisions impact the overall performance of my individual retirement accounts as I prepare for retirement?

Investment Decisions in the RSP(+): Employees control investment decisions within the RSP(+) Program. Moog’s initial contributions are invested in Moog Class B Stock Fund-Restricted, but you can reallocate to other funds. Your choices significantly impact the growth of your retirement savings, so regularly review your investment strategy to ensure it aligns with your retirement timeline and risk tolerance.

How does Moog ensure the security of my retirement benefits under the Pension Plan, and what protections are in place in the event of financial difficulties faced by the company, including the role of the Pension Benefit Guaranty Corporation (PBGC)?

Security of Retirement Benefits: Moog’s pension benefits are backed by the Pension Benefit Guaranty Corporation (PBGC), providing a safety net in case of company financial difficulties. However, the RSP(+) accounts are not PBGC-insured, and the value depends on investment performance. Your pension is protected, but careful management of your RSP investments is crucial.

In the event of my death before receiving retirement benefits, what provisions does Moog have in place for disbursing my accrued benefits to my beneficiaries, and how does marital status affect these benefits under the Moog Pension Plan and RSP?

Death Benefits: If you pass away before receiving your Pension Plan benefits and are married, your spouse receives a monthly lifetime benefit. For the RSP(+) Program, your designated beneficiary will receive your account balance as a lump sum. Spousal consent is required if you wish to name a non-spousal beneficiary. Marital status directly impacts the distribution of your retirement benefits.

How can I maximize the company match contributions offered in the RSP and RSP(+) plans, and what specific contribution levels should I aim for to ensure that I am fully leveraging the benefits provided by Moog?

Maximizing Company Match: To maximize Moog’s matching contributions, contribute at least 6% of your eligible compensation initially, increasing to 8% in 2020 and 10% in 2021 to receive the full match. By reaching these thresholds, you leverage the full benefits of Moog's matching, boosting your retirement savings potential.

If I have further questions or need more information on my retirement options, how can I contact Moog's HR Employee Support team for assistance, and what resources are available to help me navigate the transition between retirement plans effectively? These questions are designed to encourage deeper exploration of individual retirement situations and the specific policies within the companyâ€™s retirement programs.

Contacting Moog HR for Further Information: For more questions or additional guidance, you can contact Moog's HR Employee Support team via email at employeesupport@moog.com or by calling 844-367-5787. Empower Retirement’s Call Center is also available for technical questions regarding the RSP(+) Program. These resources ensure you have the support needed during your retirement transition(Moog_Choice_Guide_Retir…).

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

Moog has significantly restructured its retirement plans in recent years, transitioning from offering a traditional pension plan to a more modern defined contribution approach. Previously, Moog provided employees with a defined benefit pension plan, but for employees hired after January 1, 2008, this pension plan is no longer available. Instead, Moog created the Retirement Savings Plan Plus (RSP+), which incorporates a 401(k) with enhanced features (Moog) (Ogorek Wealth Management, LLC). In Moog's 401(k) plan, employees receive a 50% match on the first 10% of eligible pay they contribute, meaning that employees who contribute at least 10% of their salary can receive a full 5% match from Moog (Moog). Additionally, Moog makes annual direct contributions to employee 401(k) accounts. The company utilizes Blackrock Life Path funds as the default investment choice for these accounts, with options for employees to switch to alternative funds such as Vanguard, based on their preferences (Ogorek Wealth Management, LLC). Moog's pension plan, which was previously available to employees before 2008, followed a more traditional formula based on career-average pay and credited service. However, this pension plan is now closed to new participants, and the company focuses entirely on the RSP+ for retirement savings

Moog has undertaken significant changes in its operational structure, including a footprint rationalization initiative that led to the sale of two buildings in 2023. This is part of a broader restructuring effort across multiple divisions, including industrial and commercial aircraft, to optimize margins and streamline operations. This restructuring, including adjustments in the aerospace and defense businesses, is crucial as it impacts employee roles and the overall company structure. Addressing these changes is vital due to the current economic environment, as fluctuations in defense budgets and supply chain constraints continue to affect Moog's business model (Business Wire) (Moog).

Moog Inc. provides stock options and Restricted Stock Units (RSUs) to its employees as part of its equity compensation plans, aimed at aligning employee incentives with company performance. In 2022, 2023, and 2024, Moog offered these compensation packages under its equity compensation plan. Stock options at Moog typically vest over a period of three to four years, allowing employees to purchase shares at a predetermined price. Moog's RSUs vest based on the employee's tenure and performance, giving employees shares of stock without requiring an upfront purchase, unlike stock options (Moog) (PitchBook). Moog's stock options and RSUs are made available to senior employees and executives, often as part of long-term incentive plans. These plans are structured to retain key talent and ensure alignment with shareholder interests. Moog ensures that both stock options and RSUs are accessible to employees who meet performance thresholds and tenure requirements.

Moog Inc. offers a comprehensive health benefits package designed to support their employees and their families across various needs. In 2022, Moog expanded its InHealth Wellness Center located at the East Aurora campus, which now includes a full-service pharmacy and an eye care center (Moog). The pharmacy provides reduced copays on prescriptions and discounted over-the-counter products, while the eye care center offers vision exams, safety eyewear, and holistic eye health care with a licensed optometrist (Moog). Moog employees enrolled in a Moog medical plan can access most of these services at little to no cost, with offerings such as annual physicals, lab work, vaccinations, physical therapy, and nutrition counseling (Moog). In addition to traditional medical, dental, and vision plans, Moog also provides an Employee Assistance Program (EAP), offering 24/7 confidential support for personal and professional challenges (Moog). Key healthcare-related acronyms used by Moog include EAP (Employee Assistance Program) and the InHealth Wellness Program, which provides financial incentives for participation in wellness activities. Moog also offers voluntary benefits that can enhance the core health plans, alongside disability and life insurance coverage at no cost to employees

For more information you can reach the plan administrator for Moog at , ; or by calling them at .

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