Navigating Terminal Illness: Essential Planning Tips for Becton Dickinson Employees

What Is It?

When you find out that you are terminally ill, you may want to start planning immediately for your current needs and for the future needs of your survivors. In particular, you'll want to provide enough money, insurance, and assets to ensure that you will be comfortable during your final months and that you will leave your survivors with adequate income.

By communicating your wishes to your family now and by executing certain legal documents (e.g., health-care proxy, living will, durable power of attorney), you can make decisions now about your medical care and plan for the possibility that you may become incapacitated. To our clients from Becton Dickinson who may be dealing with this or a situation similar, you'll also want to make sure that your estate will be passed on to your survivors according to your wishes.

Meeting Your Current Financial Needs

Make sure that you have adequate liquidity to meet your current needs--Find out if the amount of cash you have in a savings account, money market fund, or other liquid account is enough to cover your expenses during your final months. If not, consider withdrawing funds from your retirement account, applying for insurance benefits that you may be entitled to, or selling your life insurance policy to a viatical settlement company.
Consider withdrawing funds from your retirement account--You may ask that funds be distributed to you from a defined contribution plan to pay your medical expenses. This is called a hardship distribution and it can't exceed the amount of money necessary to meet your immediate financial need. To qualify for a hardship distribution, you must not have access to other resources that could meet this need.

Caution: A hardship distribution from a defined contribution plan is subject to income tax. However, if you are disabled, or if the distribution is used to pay qualified medical expenses, the 10 percent early withdrawal penalty won't apply.

Apply for Disability Benefits That You Are Entitled to

You may be eligible for disability benefits from an individual or group disability income insurance policy once you have satisfied the elimination (waiting) period. Check your policy, or ask Becton Dickinson if you don't know whether you are covered by a disability policy.

Review Your Life Insurance Policy for Ways to Raise Cash

You may be able to borrow against your life insurance policy or obtain accelerated death benefits from your policy. Your policy may also contain a waiver of premium, so that once you've been disabled for a certain time period (typically six months), your insurance premiums will be paid by the insurance company, which will save you a bit of money.

Caution: Borrowing against your life insurance or taking accelerated death benefits will reduce the benefit paid to your survivors.

Consider Viatical Settlements

A viatical settlement is the sale of a life insurance policy to a third party. Usually, this third party is a company or a group of investors that specialize in such sales. When you sell your policy, you will generally receive between 45 percent and 85 percent of the face value of your policy. You can use this lump-sum cash payment any way you want, and if you have a life expectancy of 24 months or less, this distribution will generally be tax-free. However, it's important for our clients from Becton Dickinson to note that there are drawbacks. For instance, your survivors will no longer be the beneficiaries of your life insurance policy, and receipt of viatical settlement proceeds may make you ineligible for Medicaid.

Providing Financially for Your Survivors

Buy More Life Insurance

If you believe the amount of benefit your survivors will receive from your life insurance policy won't adequately meet their needs and you have a life insurance policy through Becton Dickinson, find out if you can buy additional coverage during the open enrollment period without proving insurability. Also, review your current life insurance policy to see if you are entitled to buy more coverage without proving insurability. If you are taking out a loan to purchase consumer goods, you may be able to purchase credit life insurance to pay off your loan after you die.

Caution: Proceeds from a life insurance policy are generally nontaxable to your beneficiaries. However, those proceeds are includable in your gross estate for estate tax purposes if they are payable to your estate, your executor, or an individual or trust legally obligated to pay estate debts.

Make Sure That Your Survivors Will Have Access to Needed Funds

Your survivors may need money to pay for their daily living expenses, as well as expenses associated with your death. Although you can provide for them with life insurance, you may also want to ensure they have access to liquid property (cash you have in CDs, savings, and checking accounts, for instance). If necessary, add your spouse, child, or another survivor to your account so they can access funds as joint owners after you die.

Tip: Consider adding your spouse as a joint owner on your credit card account if you want to make sure that he or she has access to the credit line after your death, particularly if your spouse currently has no credit established in his or her own name.

Find Out What Benefits Your Survivors Will Be Eligible For

Your survivors may be eligible for Social Security survivor benefits, benefits from the U.S. military (if you are an active-duty or retired service member), or survivor's benefits from your qualified retirement plan. If you are already retired from Becton Dickinson and you elected to provide a survivor's annuity for your spouse, then he or she may have continued income from your retirement annuity after your death.

However, even if you are not yet retired from Becton Dickinson, your spouse or another beneficiary may receive a lump-sum payment from your qualified plan at your death.

Tip: Continuing payments made to your estate (if named as beneficiary) or to a family member may be includable in your gross estate for estate tax purposes.

Make Use of Appropriate Planning Opportunities to Minimize Potential Federal Estate Taxes

If your estate is less than the applicable exclusion amount, it will be exempt from federal gift and estate tax. However, if your estate exceeds the applicable exclusion amount, you should consider implementing strategies to minimize potential estate taxes, such as making gifts in the amount of the annual gift tax exclusion each year to any number of recipients (this figure is indexed for inflation, so it may change in future years), transferring property to a spouse, or making charitable contributions.

Estate Planning Concerns and Opportunities

Review Your Will or Make One

To our clients from Becton Dickinson who have a will, you should review it and make any necessary changes. If you don't have a will, you should execute one now with the help of an attorney. In your will, you'll want to nominate a guardian for your minor children (if any), name an executor for your estate, and determine how your assets will be distributed after your death.

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Ensure That Your Estate Is Liquid

Now is the time for these Becton Dickinson clients to ensure that their estate is liquid enough to pay the costs associated with settling the estate. If your survivors are forced to sell assets to meet the obligations, they may lose income or assets that you intended for them. There are many ways to ensure estate liquidity, such as distributing non-liquid assets to your heirs in your will, selling estate assets before your death, and establishing a buy-sell agreement if you are a business owner.

Planning for Incapacity

When you're terminally ill, you must plan for the day you won't be able to handle your own affairs. A durable power of attorney will give a person of your choice the right to act on your behalf if you become incapacitated and can no longer manage your finances or sign legal documents. If you want that person to have the power to make healthcare-related decisions only, consider executing a healthcare proxy.

If you want to make sure that no procedures are used to prolong your life, you may want to execute a living will. A living will can also protect your family from having to make traumatic decisions on your behalf by making your wishes clear while you are still competent.

Tip: To protect yourself from people who may think you are incapacitated when you aren't, ask your doctor to sign a physician's certificate certifying that you are able to sign and execute legal documents.

Income Tax Planning Concerns

If you can no longer work at Becton Dickinson, you may have to liquidate your investment, retirement, or insurance assets to cover your expenses. By controlling when you recognize income or gain, you can control taxation. In addition, these Becton Dickinson clients should keep track of their medical expenses in case they qualify as allowable deductions to reduce their taxable income.

Making Decisions About The Future

Planning for Medical Care

Maintaining health insurance coverage is crucial when you're terminally ill. If you drop your coverage, you probably won't be able to purchase more. If you lose your coverage because you lose your job with Becton Dickinson, plan to purchase follow-on COBRA insurance to maintain coverage. In addition, these Becton Dickinson clients should review the limits of their healthcare insurance to determine whether their healthcare policy will pay for in-home care, including hospice care, if they don't need or want care in a hospital.

Planning Your Funeral

Many people may prefer planning their own funeral because they can make sure the funeral and final arrangements are what they want. It may be helpful to your family as well because they won't need to make stressful decisions while they are grieving.

Tip: If you are a veteran of the U.S. Armed Forces, find out what death benefits you are entitled to. For instance, you may be eligible for burial in a national cemetery, final honors, a headstone, a flag, or other benefits.

Making an Organ Donation

For our clients from Becton Dickinson who would like to be an organ donor, make arrangements now. Talk over the matter with your family because they may be upset by your wish to be an organ donor. Be sure they understand your decision before you proceed. For information on organ-donor programs, check with your local department of motor vehicles or ask your doctor for a referral.

How does the Becton Dickinson and Company defined benefit plan differ from the cash balance plan in terms of eligibility and benefit calculation? Employees at Becton Dickinson and Company should be aware of how their retirement options and benefit calculations are structured, especially considering the historical context and the changes made after

Defined Benefit vs. Cash Balance Plan: The Becton Dickinson and Company defined benefit plan and cash balance plan differ significantly in terms of eligibility and benefit calculations. The defined benefit plan, which was the original format, calculates benefits based on the employee's final average pay, age, and years of service. On the other hand, the cash balance plan, introduced in 2007, provides a hypothetical account balance that grows with defined pay and interest credits. For eligibility, new hires after January 1, 2018, cannot join either plan, reflecting a closure to new entrants. Those rehired or transferred within the company after this date also cannot accrue new benefits under the cash balance plan.

This question encompasses the differences in participation rules, the implications of being hired before or after January 1, 2018, and how various employment classifications affect benefits.

Pension Benefits Calculation: Under the BD Retirement Plan, pension benefits are calculated based on 'Total Compensation,' which includes various forms of income like base salary, bonuses, and other regular compensations. The benefit is determined by 'Credited Service' and 'Vesting Service,' impacting the final benefit amount. Vesting in the plan occurs after five years of service, ensuring that employees are entitled to benefits regardless of subsequent employment duration.

In what ways are pension benefits and service calculated under the Becton Dickinson and Company BD Retirement Plan? The complexities involved in determining the pension benefit calculation are crucial for employees to understand as they plan for retirement. A discussion on how Total Compensation, Credited Service, and Vesting Service impact the final benefit amount will provide clarity to employees regarding their financial planning as they approach retirement.

Maximum Benefit Limits: Employees should be aware of IRS-imposed limits on contributions and benefits under retirement plans. For 2018, the compensation limit recognized for pension calculations was $275,000, adjusted annually for inflation. This affects the projected retirement benefits and requires employees to stay informed about annual adjustments to plan accordingly.

What specific maximum benefit limits should employees at Becton Dickinson and Company be aware of regarding their retirement plans and how do these limits adapt annually? Understanding the implications of IRS limits for defined benefit plans and cash balance plans is vital for employees at Becton Dickinson and Company. This question would delve into how annual adjustments might affect their projected retirement benefits and the importance of staying informed about these limits.

Addressing Discrepancies or Denial of Benefits: If discrepancies or wrongful denials occur concerning retirement benefits, Becton Dickinson and Company employees should contact the Plan Administrator. The process includes filing claims and understanding the rights to appeal under the Employee Retirement Income Security Act (ERISA). This structured approach helps employees rectify issues with their retirement benefits effectively.

How can Becton Dickinson and Company employees address discrepancies in their benefit calculations or if they believe they have been wrongfully denied benefits? The processes for appealing decisions made regarding retirement benefits can greatly impact an employee's financial future. This question would outline the steps employees can take, including contacting the Plan Administrator and the importance of understanding their rights under the Employee Retirement Income Security Act (ERISA).

Role of Committees in Managing the Retirement Plan: The Plan Administrative Committee and the Investment Committee play critical roles in overseeing the BD Retirement Plan. The former handles the plan's administration, ensuring compliance and managing benefit claims, while the latter focuses on the investment of plan assets. Employees can seek clarification or get involved by attending committee meetings or contacting them directly for specific inquiries.

What roles do the Plan Administrative Committee and the Investment Committee play in managing the BD Retirement Plan of Becton Dickinson and Company, and how can employees get involved or seek clarification on their plans? Employees interested in understanding the governance of their retirement plan will benefit from knowing who oversees the administration and investment of their benefits and how they can participate in discussions or seek advice.

Impact of Early Retirement: Early retirement affects the calculation of pension benefits, which are reduced based on the number of years retirement is taken before the normal retirement age. The plan allows for early retirement from age 55 with at least 10 years of service, with benefits reduced to compensate for the longer payout period.

How does the early retirement benefit impact employees at Becton Dickinson and Company, particularly in terms of eligibility and the calculation of reduced benefits? By exploring the conditions under which early retirement is permitted, along with calculations related to the reduction in benefits for taking early retirement, employees can make more informed decisions based on their personal circumstances.

Ensuring Accuracy of Retirement Benefits: To ensure accuracy in the calculation of retirement benefits, especially after changes in personal circumstances such as marital status or address, employees are encouraged to promptly update their information with HR. Regular reviews of their retirement plan statements and maintaining communication with the plan administrator are advisable practices.

What steps should employees of Becton Dickinson and Company take to ensure their retirement benefits remain accurate and up-to-date, especially after a change in personal circumstances? This question addresses the importance of regularly updating personal information and understanding the repercussions of life changes on retirement benefits, ensuring employees are proactive in managing their future.

Alternatives for Non-Eligible Employees: Employees not eligible for the BD Retirement Plan, possibly due to the timing of their hire or their role, should explore other retirement savings options like IRAs or the BD 401(k) Plan. These alternatives provide avenues for retirement savings, even for those not covered under the traditional pension plans.

What alternatives exist for Becton Dickinson and Company employees who are not eligible for the BD Retirement Plan, and how can they plan for retirement adequately? This discussion can help inform employees who may fall outside the eligibility criteria about other retirement savings options, such as Individual Retirement Accounts (IRAs) or employer-sponsored 401(k) plans.

Determining Survivors' Pensions: The survivor's pension is determined by the pre-retirement surviving spouse benefit, which generally provides a monthly benefit of 50% of the employee's pension, payable to the spouse for life after the employee's death. This emphasizes the importance of employees designating beneficiaries and understanding the impact of these decisions on their family's financial security.

In the context of the Becton Dickinson and Company BD Retirement Plan, how are survivors' pensions determined, and what options are available for employees regarding beneficiaries? Employees often overlook the significance of beneficiary designations. This question would clarify the process and options available for ensuring that survivors receive entitled benefits and the financial implications of different choices made regarding pension benefits for spouses and dependent children.

Contacting the Plan Administrator: Employees seeking more information about their retirement benefits should contact the Plan Administrator. Preparedness for such inquiries includes having detailed personal and employment information, understanding their current benefits status, and having specific questions or concerns about their plan benefits.

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

Becton Dickinson announced a restructuring plan that includes significant layoffs and a shift in their global operations strategy. The company aims to streamline its operations and reduce costs amid a challenging economic environment.

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For more information you can reach the plan administrator for Becton Dickinson at 1 Becton Dr Franklin Lakes, NJ 7417; or by calling them at +1 201-847-6800.