Healthcare Provider Update: Healthcare Provider for Devon Energy: Devon Energy Corporation partners with Aetna as its healthcare provider. Aetna offers a range of health plans and services to support the wellness needs of Devon Energy employees and their families. Potential Healthcare Cost Increases in 2026: As healthcare costs continue to rise, Devon Energy could see significant increases in employee healthcare expenses in 2026, attributed in part to anticipated premium hikes associated with the Affordable Care Act (ACA). With some states preparing for rate increases of up to 66% and the expiration of enhanced federal premium subsidies, employees may face out-of-pocket premium escalations of over 75%. The confluence of rising medical costs and changes in healthcare policy may necessitate adjustments in how both employers and employees plan for their health coverage, prompting a careful re-evaluation of benefit strategies in the coming year. Click here to learn more
As Devon Energy employees transition into retirement, you need to continually review and adjust your portfolio to better fit your long-term goals - and if you're dealing with required distributions and rising healthcare costs, working with a financial expert like Tyson Mavar at The Retirement Group can help you optimize these decisions.
So for Devon Energy employees approaching retirement age, planning now should include conservative spending and a diversified portfolio to ensure retirement income lasts a lifetime, and working with an advisor like Patrick Ray at The Retirement Group can help you tailor a strategy to fit your needs.
In this article, we will discuss:
1. How to periodically review your portfolio and strike a balance between growth and security.
2. How to spend wisely and plan withdrawals for a sustainable retirement.
3. Learn about your retirement plan distribution options and required minimum distributions.
Your years of work for Devon Energy have been geared toward your retirement. That day is here! But this also means you'll have to manage your assets to ensure your retirement savings last.
Review Your Portfolio Regularly
We first suggest our Devon Energy clients regularly review their portfolios. By convention, retired people should be concerned first about the security of their principal. Upon reaching retirement age, some move their portfolios into fixed-income investments like bonds and money market accounts. The problem is that you will lose purchasing power if your investment returns are not keeping pace with inflation. Although you should generally aim to get more conservative with age, we think it prudent for our Devon Energy clients to at least have some of their portfolio in growth investments.
Spend Wisely
But we caution our clients not to assume they can live comfortably for the rest of their lives on earnings from their investment portfolios and Devon Energy-sponsored retirement accounts - and that they should spend wisely. You may eventually have to start drawing on the principal. Devon Energy customers must avoid spending too much too soon. Such a temptation can be especially strong early in retirement.
An acceptable thumb rule for our Devon Energy clients is to limit their annual withdrawal rate to 4 - 6 percent of the portfolio. The appropriate percentage will depend on the length of your payout period and your asset allocation. But our Devon Energy clients should also consider that running down the principal too quickly may mean they will not make enough money on the remaining principal to last them through later years.
Understand Your Retirement Plan Distribution Options.
Most pension programs offer these benefits as an annuity. Typically, our Devon Energy clients who are married choose either a larger retirement benefit for themselves or a smaller benefit for their spouse upon death. You should consult a financial expert about this important decision.
Other Devon Energy-sponsored retirement plans pay benefits in the form of annuities, such as 401(k)s. You may have limited distribution (and investment) options. You want to max out your savings by dipping into your retirement accounts slowly. This will preserve your principal and allow it to grow tax-deferred during your retirement years after leaving Devon Energy.
Think about whether you should convert your Devon Energy retirement account to a traditional IRA with lots of withdrawal options if your new employer has a retirement plan and allows a rollover.
Plan for Required Distributions
Note to Devon Energy customers: You must begin drawing minimum distributions from retirement plans and traditional IRAs by age 70½, whether or not you need them. Consider spending these first years in retirement.
No distributions are required for Devon Energy customers with a Roth IRA during their lifetime. You can keep your funds tax-deferred, and qualified withdrawals are not taxed. These special tax advantages mean you should usually withdraw funds from a Roth IRA first.
Know Your Social Security Options.
When you start receiving Social Security retirement benefits depends on you. At your normal retirement age - 66 to 67, depending on when you were born - you can get your full Social Security retirement benefit. You can start getting your Social Security retirement benefit at age 62 but your benefit will be reduced if you start getting it before your normal retirement age. By contrast, putting off your Devon Energy retirement decreases your Social Security retirement benefit.
Consider Phasing
Some find the transition from Devon Energy employee to Devon Energy retiree difficult. For this reason, some employers - especially public ones - have started offering phased retirement plans. In general, you can continue working part-time during phased retirement. You gain from a more seamless transition from full-time employment to retirement while your employer retains a highly skilled employee. Some phased retirement plans let you take part or all of your pension benefit while you work part-time.
Obviously, the bigger your salary, the smaller your retirement pot will be. Still, have tax-deferred funds in your IRA or Devon Energy-sponsored retirement plan if you delay full retirement. You could start drawing minimum distributions from your qualified retirement plan or traditional IRA at age 70½ to avoid large penalties.
For our Devon Energy customers who continue to work, know the consequences. Some pension plans base your retirement benefit on your ultimate average pay. Part-time work may reduce your pension benefit because your pay has decreased. Remind these Devon Energy employees that if they are under the normal retirement age, their employment income could affect Social Security retirement benefits. You can earn as much as you want after the normal retirement age without affecting your Social Security retirement benefit.
Facing a Shortfall
But what if, nearing Devon Energy retirement, you find your retirement income is not enough to cover your retirement costs? With retirement approaching, you may have to up your spending and savings game. A little money can add up quickly if you save and earn a decent return. By permanently changing your expenditure patterns, your savings will last longer. Create a budget for where your money is going. Some ways our clients at Devon Energy can stretch their retirement funds:
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Refinance if interest rates have dropped since you took out the loan, or move to a less expensive home or apartment to cut down on accommodation costs. Use your home equity. Get a reverse mortgage or draw down funds from a second mortgage or home equity line of credit to repay debts with higher interest rates. You own two vehicles - Sell one. Your remaining vehicle should be replaced - buy a pre-owned vehicle. Switching credit card balances from higher rate cards to a card with low or no interest will shut down the old accounts. Review your needs for insurance and ask for discounts (you may not need life insurance anymore). Rediscover less frivolous expenses like dining out for lunch and dinner.
Planning ahead, investing wisely, and controlling spending can increase your chances of a financially secure Devon Energy retirement.
Added Fact:
Consider how much healthcare costs will affect your retirement. A couple retiring at age 65 could spend an estimated USD 300,000 on healthcare in retirement, according to research by Fidelity Investments. This covers expenses outside of Medicare - like deductibles, premiums, and prescription drugs. We recommend our Devon Energy clients consider incorporating these potential costs into their retirement planning and exploring Medicare supplemental insurance or health savings accounts to help offset the cost of healthcare in retirement. (Source: Plan for rising healthcare costs - Fidelity Investments).
Added Analogy:
Retirement is like climbing a mountain to the top. You can look down and enjoy the high point of a successful career and the financial security you have built. The journey doesn't stop there though. As reaching the summit means new adventures and pleasures, so too does retirement require planning and decision-making. You have to manage your assets, generate maximum income streams and preserve your savings. It is like going on an expedition - reviewing your portfolio, spending wisely and understanding your options. You may face obstacles as you descend from the peak but with preparation and guidance you can see the sights of financial security and a comfortable retirement. Thus, savor the achievement - but get ready for the next adventure that retirement will bring.
Sources:
1. Yahoo Finance. 'Cognizant Technology Solutions Corporation (CTSH) Stock Price.' Yahoo Finance, 2024, finance.yahoo.com/quote/CTSH.
2. Google Finance. 'Cognizant Technology Solutions Corporation (CTSH) Stock Quote.' Google Finance, 2024, www.google.com/finance/quote/CTSH?sa=X&ved=2ahUKEwiN5KHL0v7_AhUJxosKHZlNBUoQ3ecFegQINBAY .
3. Bloomberg. 'Cognizant Technology Solutions Corporation.' Bloomberg, 2024, www.bloomberg.com/quote/CTSH:US .
4. MarketWatch. 'Cognizant Technology Solutions Corporation (CTSH).' MarketWatch, 2024, www.marketwatch.com/investing/stock/ctsh .
What is the primary purpose of the 401(k) Savings Plan at Devon Energy?
The primary purpose of the 401(k) Savings Plan at Devon Energy is to help employees save for retirement by allowing them to contribute a portion of their salary on a pre-tax or after-tax basis.
How can employees at Devon Energy enroll in the 401(k) Savings Plan?
Employees at Devon Energy can enroll in the 401(k) Savings Plan by logging into the employee portal and completing the online enrollment process during the designated enrollment period.
What types of contributions can employees make to the Devon Energy 401(k) Savings Plan?
Employees at Devon Energy can make pre-tax contributions, Roth (after-tax) contributions, and, if eligible, catch-up contributions to the 401(k) Savings Plan.
Does Devon Energy offer any matching contributions to the 401(k) Savings Plan?
Yes, Devon Energy offers a matching contribution to the 401(k) Savings Plan, which is designed to encourage employees to save for retirement.
What is the vesting schedule for employer contributions in the Devon Energy 401(k) Savings Plan?
The vesting schedule for employer contributions in the Devon Energy 401(k) Savings Plan typically follows a graded vesting schedule, meaning employees gradually earn ownership of the company's contributions over time.
Are there any fees associated with the Devon Energy 401(k) Savings Plan?
Yes, there may be administrative fees associated with the Devon Energy 401(k) Savings Plan, which are disclosed in the plan documents provided to employees.
Can employees at Devon Energy take loans against their 401(k) Savings Plan balance?
Yes, employees at Devon Energy may be able to take loans against their 401(k) Savings Plan balance, subject to the plan's terms and conditions.
What investment options are available in the Devon Energy 401(k) Savings Plan?
The Devon Energy 401(k) Savings Plan offers a variety of investment options, including mutual funds, target-date funds, and company stock, allowing employees to diversify their retirement savings.
How often can employees change their contribution amounts to the Devon Energy 401(k) Savings Plan?
Employees at Devon Energy can change their contribution amounts to the 401(k) Savings Plan at any time, subject to the plan's guidelines.
What is the minimum age requirement to participate in the Devon Energy 401(k) Savings Plan?
The minimum age requirement to participate in the Devon Energy 401(k) Savings Plan is typically 21 years old, but employees should refer to the plan documents for specific details.
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