New Update: Rising Oil Costs are Affecting Retirement Plans. Will you be impacted?
Navigating Sequence Risk in Retirement: Lessons and Strategies for Nordson Employees
/General/General%204.png?width=1280&height=853&name=General%204.png)
Oil market turbulence continues to ripple through the broader economy, with crude swinging between $50 and $120 per barrel and annualized volatility near 80%. Petroleum-derived adhesives, coatings, plastics, and chemical feedstocks, along with global distribution energy costs, create meaningful oil price exposure for diversified industrial manufacturers. For Nordson employees building retirement savings, oil-driven inflation and market volatility make disciplined saving and diversified allocation more important, as energy cycles can disrupt both portfolio values and purchasing power. Working with a financial advisor can help you position your planning strategy for sustained energy price uncertainty.
'Nordson 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.
'Nordson 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.
-
Research‑backed strategies for managing sequence risk and supporting long‑term retirement goals.
Contributed by Paul Bergeron and Brent Wolf of Wealth Enhancement
For Fortune 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-of‑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
Fortune 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&P 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 Fortune 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 Fortune 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 short‑ to intermediate‑term bonds, may give equities time to recover before they're tapped for income. For some Fortune 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 Fortune 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 Nordson into retirement, understanding the company's benefit structure can help you make more informed decisions. According to publicly available information, Nordson maintains an active defined benefit pension plan, which provides retirement income based on factors such as years of service and compensation history. Nordson 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 Nordson'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 Nordson Corporation Salaried Employees Pension Plan calculate an employee's Accrued Benefit, and what factors need to be considered to ensure accurate pension benefits at retirement? Understanding the components that contribute to the calculation is crucial for employees planning their retirement through Nordson Corporation.
Accrued Benefit Calculation: Nordson Corporation calculates an employee’s Accrued Benefit based on the Final Average Monthly Pay, the number of Years of Benefit Service, and an estimate of the employee’s Social Security benefit. The formula used includes a reduction if an employee has less than 30 Years of Benefit Service(Nordson Corporation_Feb…).
What are the eligibility criteria for joining the Nordson Corporation Salaried Employees Pension Plan, and how can employees determine their vesting status as they approach retirement? It is essential for employees to be aware of the timelines and requirements necessary to fully benefit from the retirement plan offered by Nordson Corporation.
Eligibility Criteria: Employees become eligible for the Nordson Corporation Salaried Employees Pension Plan after completing a Year of Eligibility Service, which requires at least 1,000 hours of work annually. Vesting occurs after completing 5 Years of Vesting Service, ensuring full entitlement to benefits(Nordson Corporation_Feb…).
In what ways can employees at Nordson Corporation access information about their pension plan benefits, and what steps should they follow if they believe their claims for benefits were denied? Knowing the appropriate channels for receiving information can help employees navigate any discrepancies with their pension benefits.
Accessing Pension Information and Claiming: Employees can access their pension plan details through John Hancock’s website or phone service. If a benefit claim is denied, employees can follow the claims procedure outlined by Nordson, which includes submitting a written request and appealing decisions(Nordson Corporation_Feb…).
What options does Nordson Corporation provide for early retirement, and how can employees assess whether an early retirement is financially feasible for them? Understanding the implications of early retirement can significantly impact an employee's long-term financial security.
Early Retirement Options: Nordson Corporation offers early retirement options starting at age 55, with at least 5 years of vesting service. Benefits are reduced by 6% per year for each year that early retirement is taken before the Normal Retirement Date(Nordson Corporation_Feb…).
How does Nordson Corporation's pension plan ensure that employees receive monthly benefits post-retirement, and what are the different forms of payment available to retirees? Grasping the payment structures may help employees make informed decisions regarding their retirement income.
Monthly Benefit Payments: Employees retiring from Nordson Corporation can choose various payment methods, including a Life Annuity or a 50% Joint & Survivor Annuity for married participants. Payments start after the Normal Retirement Date or early retirement, depending on the selected option(Nordson Corporation_Feb…).
What rights do participants have under the Employee Retirement Income Security Act (ERISA) concerning their Nordson Corporation pension plan, and what should they do to enforce these rights effectively? Employees should be aware of their rights to protect themselves during the benefit claiming process.
ERISA Rights: Under ERISA, participants have the right to receive information about their benefits, file claims, and sue if benefits are denied. Plan fiduciaries must act in the best interest of employees, and participants are protected from retaliation for asserting their rights(Nordson Corporation_Feb…).
How does the termination or amendment of the Nordson Corporation Salaried Employees Pension Plan affect employees' accrued benefits, and what protections are in place? Awareness of these scenarios can help employees better plan their financial futures in relation to their pensions.
Plan Termination or Amendment: If the plan is terminated or amended, accrued benefits cannot be reduced, and employees’ benefits become 100% vested. This ensures that employees retain the benefits they have earned up to the point of the change(Nordson Corporation_Feb…).
In what situations might employees at Nordson Corporation lose their pension benefits, and what preventative actions can they take to ensure they remain eligible for these benefits? Understanding the risks involved in pension plans can aid employees in maintaining their retirement security.
Loss of Pension Benefits: Employees may lose pension benefits if they leave Nordson Corporation before vesting or fail to select appropriate survivor options. Keeping the Plan Administrator informed of current contact information is crucial to avoid losing benefits(Nordson Corporation_Feb…).
How can employees at Nordson Corporation address questions or concerns related to their retirement planning, and what resources are available for personalized assistance? Access to proper resources is vital for employees needing guidance throughout their retirement journey.
Retirement Planning Resources: Employees can contact the Plan Administrator or use John Hancock’s automated services to address questions about retirement planning. Personalized assistance is available for any specific pension-related inquiries(Nordson Corporation_Feb…).
What steps should employees take to contact Nordson Corporation or the Plan Administrator to get detailed information about their pension plan, and what should they include in their inquiries to ensure a comprehensive response? Effective communication techniques can significantly enhance employees' understanding of their benefits. These questions have been designed to help employees of Nordson Corporation navigate their pension plan and retirement effectively.
Contacting the Plan Administrator: Employees can contact Nordson Corporation or the Plan Administrator by calling the number listed in the Summary Plan Description. It’s advisable to provide detailed questions regarding benefit amounts, vesting status, or payment options to receive a thorough response(Nordson Corporation_Feb…).
For more information you can reach the plan administrator for Nordson at , ; or by calling them at .
https://www.thelayoff.com/ https://finance.yahoo.com/ https://www.marketwatch.com/
Help shape our next stories
Choose the topics you’d love to read more about. Your input helps us focus on content that matters to you.