Healthcare Provider Update: Healthcare Provider for Duke Energy Duke Energy utilizes a range of health benefits and insurance plans provided through major healthcare organizations, with Aetna being one of the primary providers offering their employee health insurance coverage. Potential Healthcare Cost Increases for Duke Energy in 2026 As 2026 approaches, Duke Energy employees may face significant healthcare cost increases due to a combination of factors impacting the broader health insurance market. Record premium hikes for Affordable Care Act (ACA) marketplace plans, with some states eyeing increases exceeding 60%, could manifest in employer-sponsored plans as well. The potential expiration of enhanced federal premium subsidies, alongside rising medical costs and aggressive rate hikes from insurers, may significantly elevate out-of-pocket expenses for beneficiaries. This perfect storm of factors indicates that employees might need to prepare for substantial healthcare financial burdens in the upcoming year, as many individuals could see their premiums rise by more than 75%. Click here to learn more
'RMDs may feel restrictive, but for Duke Energy employees they also create structured opportunities to rebalance portfolios, manage taxable income, and strengthen long-term planning.' – Paul Bergeron, a representative of The Retirement Group, a division of Wealth Enhancement.
'By treating RMDs as a planning tool rather than just a tax requirement, Duke Energy employees can use them to create flexibility in withdrawals and align retirement income with broader financial goals.' – Tyson Mavar, a representative of The Retirement Group, a division of Wealth Enhancement.
In this article, we will discuss:
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Which retirement accounts are subject to RMDs and recent legislative changes.
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Strategies that Duke Energy employees can use to manage the tax impact of RMDs.
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How market conditions and long-term planning interact with RMD requirements.
By Wealth Enhancement Group's Brent Wolf
RMDs, or required minimum distributions, are a critical consideration for retirement income planning. Because they are required, they are sometimes seen as burdensome, but they also offer opportunities for careful money management. For Duke Energy employees, understanding how RMDs work and incorporating them into a broader strategy can help improve portfolio efficiency and mitigate long-term tax impacts.
Accounts Subject to RMDs
Traditional tax-deferred retirement accounts, which are funded with pre-tax contributions and grow tax-deferred, fall under RMD rules. These include SEP IRAs, 403(b) plans, 401(k) plans, 457 plans, and traditional IRAs. Once individuals reach a certain age, withdrawals are mandatory. Roth accounts stand out as exceptions. Roth IRAs remain permanently free of RMDs, while Roth 401(k) plans are also exempt under recent legislation. For Duke Energy workers nearing retirement, this exemption may enhance the role that Roth accounts can play as long-term planning tools, since assets can continue growing without taxable withdrawals.
Changing Ages for RMDs
The age at which retirees must begin taking RMDs has shifted in recent years. For decades, it was 70½. It later increased to 72, and then to the current age of 73. Beginning in 2033, the starting age will move again to 75. For Duke Energy retirees, these adjustments provide more flexibility and open a wider window to implement strategies such as Roth conversions, systematic withdrawals, or portfolio rebalancing before RMDs take effect.
Why RMDs Are Often Disliked
RMDs are unpopular among retirees who don't require the funds for their current living expenses because they trigger taxable income. This added income can push retirees into higher tax brackets, raising their overall tax burden. For Duke Energy employees with substantial retirement savings, RMDs can also affect Medicare costs through higher income-related monthly adjustment amount (IRMAA) surcharges. In many cases, RMDs represent a significant annual tax consideration for households.
Techniques to Manage RMDs
Although RMDs for traditional accounts cannot be fully eliminated, several approaches can help reduce their taxable impact:
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Pre-Retirement Diversification: Spreading savings across Roth accounts, taxable brokerage accounts, and traditional retirement plans may lower future RMD obligations.
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The Early Retirement Window: For those who stop working before 73, the years between retirement and the first RMD are often lower-income years—ideal for Roth conversions or accelerated withdrawals at more favorable tax rates.
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Qualified Charitable Distributions (QCDs): Starting at 70½, IRA owners can direct RMD distributions directly to qualified charities, rather than taking them themselves, reducing taxable income while meeting RMD requirements and achieving charitable goals.
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Still Working Past 73: Employees still working at Duke Energy after age 73 may be able to delay RMDs on their active employer plan.
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Legacy Planning: Roth conversions, even after RMDs start, can lower the taxable inheritance left to beneficiaries, aiding in estate planning.
Market Conditions and RMDs
A common question is whether market downturns affect RMD amounts. The answer is no—RMDs are based on account balances as of December 31 of the prior year. Short-term fluctuations do not alter the required withdrawal. While Congress has occasionally suspended RMDs during crises, such as in the pandemic, these suspensions remain rare.
Turning RMDs Into Opportunities
Although RMDs are mandatory, they can be reframed as tools for portfolio management. By selling from overweighted positions, retirees can meet their RMD while also rebalancing. For Duke Energy retirees with large equity allocations, this may mean using withdrawals to trim stock-heavy portfolios in favor of diversification.
Additionally, funds withdrawn through RMDs need not sit idle. If not required for daily expenses, they can be reinvested into a Roth IRA (subject to eligibility) or taxable brokerage account. This reinvestment can help maintain long-term portfolio growth.
Conclusion
While RMDs are often viewed as mandatory tax obligations, Duke Energy employees can approach them strategically. Diversifying account types before retirement, making use of early retirement years, using QCDs, and considering Roth conversions all provide ways to manage the impact. When integrated into a broader financial plan, RMDs can serve as both compliance and opportunity—helping retirees sustain portfolio health, mitigate taxes, and extend financial growth into the future.
Custodians typically calculate RMD amounts and provide reminders, but the responsibility to take the correct distribution rests with the account holder. By anticipating these requirements and using them to rebalance or reinvest, Duke Energy retirees can approach RMDs as part of a proactive retirement strategy.
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Sources:
Internal Revenue Service. Publication 590-B: Distributions from Individual Retirement Arrangements (IRAs). U.S. Department of the Treasury, Mar. 19, 2025. pp. 6–7, 37. https://www.irs.gov/publications/p590b
Myers, Elizabeth A. Required Minimum Distribution (RMD) Rules for Original Owners of Retirement Accounts. Congressional Research Service, 29 Aug. 2024. p. 1. https://crsreports.congress.gov/product/pdf/IF/IF12750
Centers for Medicare & Medicaid Services. Medicare Costs 2025. CMS Product No. 11579, Dec. 2024. pp. 2–3. https://www.cms.gov/newsroom/fact-sheets/2025-medicare-parts-b-premiums-and-deductibles
Social Security Administration. Form SSA-44: Medicare Income-Related Monthly Adjustment Amount — Life-Changing Event. SSA, Dec. 2024. pp. 1, 5–7. https://www.ssa.gov/forms/ssa-44.pdf
Financial Industry Regulatory Authority. Thinking About Rolling Over Funds From Your Thrift Savings Plan? Consider This. FINRA, Nov. 2024. p. 2. https://www.finra.org/investors/military/retirement/roll-over-tsp
How does the Duke Employees' Retirement Plan calculate benefits at normal retirement age, specifically for employees who reach the age of 65? In what circumstances might an employee consider retiring before reaching this age, and how would the benefits differ if they choose this option?
Benefit Calculation at Normal Retirement Age: Duke Employees' Retirement Plan calculates benefits for employees who retire at age 65 by applying a formula that includes 1.25% of their average final compensation for the first 20 years of credited service and 1.66% for any additional years. If an employee retires before 65, they can do so after age 45 with 15 years of service, but their benefits will be reduced based on how early they retire, resulting in lower payments due to a longer payout period.
What considerations should an employee keep in mind regarding their unused sick leave or carry-over bank hours when calculating benefits under the Duke Employees’ Retirement Plan? How does Duke utilize these factors to enhance an employee's credited service for the purpose of benefit calculation?
Impact of Unused Sick Leave and Carry-Over Bank Hours: Unused sick leave and carry-over bank hours are converted into additional credited service, which can enhance the calculation of retirement benefits. Employees who have accumulated these hours can see their credited service extended, leading to higher pension benefits at retirement.
In what situations would an employee's benefits under the Duke Employees' Retirement Plan be automatically paid in a lump sum? How does the Plan determine the value of benefits that fall below the threshold for monthly payouts, and what implications does this have for retirement planning?
Lump-Sum Payments for Small Benefits: If the value of an employee's benefit is $5,000 or less, Duke Employees' Retirement Plan automatically pays it as a lump sum. For benefits between $5,000 and $10,000, employees can choose between a lump-sum payment or a monthly pension. This can significantly impact retirement planning, especially for employees weighing whether to take a smaller upfront amount or spread it over time.
How does the Duke Employees' Retirement Plan handle benefit adjustments for employees who continue to work beyond their normal retirement age? What factors influence how these adjustments are calculated, and what implications might this have for future financial planning for employees nearing retirement?
Benefit Adjustments for Postponed Retirement: Employees who continue working beyond their normal retirement date will see their benefits increased annually (by no less than 10%) to account for the shorter period during which they will receive payments. The plan recalculates benefits based on the employee’s continued service and compensation after age 65.
What options are available to employees of Duke University regarding payment forms when they retire, and what are the long-term implications of choosing each option? How do these choices affect both the retiree's monthly income and survivor benefits for a spouse or other beneficiary?
Payment Form Options and Implications: At retirement, employees can choose various payment options such as a single life annuity, joint and survivor annuities, or a lump-sum payment. These choices affect the amount received monthly and any survivor benefits for a spouse or beneficiary. Employees should carefully consider their long-term financial needs and the needs of their beneficiaries when selecting a payment option.
What specific protections does the Duke Employees' Retirement Plan provide for spouses in the event of an employee's death, and how does this influence the choice of payment options? What steps must an employee take to ensure that their spouse's rights are upheld under the Plan?
Spousal Protections: The Plan provides protections for spouses in the event of an employee's death. A surviving spouse can receive 50% of the employee's reduced monthly benefit through a joint and survivor annuity. Employees must take steps to ensure spousal rights are protected by selecting the appropriate payment option and ensuring the necessary documentation is completed.
How can employees of Duke University ensure that they are informed about their rights under ERISA while participating in the Employees' Retirement Plan? What resources and tools does Duke provide to help employees understand and assert these rights?
Employee Rights Under ERISA: Duke provides resources for employees to understand their rights under ERISA, including access to plan documents and assistance in filing claims. Employees are encouraged to use Duke's available tools to assert their rights and ensure they are fully informed about the benefits available to them under the Plan.
In what ways can employees at Duke University navigate the complexities of reemployment after retirement, and how does their choice of retiree status affect their benefits? What regulations govern how benefits are recalculated if they choose to return to work at Duke?
Reemployment After Retirement: Employees who return to work at Duke after retiring can continue to receive their pension if they work fewer than 1,000 hours per year. However, if they exceed 1,000 hours, their payments will be paused and recalculated based on additional service and earnings when they retire again. This provides flexibility for employees considering reemployment after retirement.
What impact do legislative changes, such as those introduced by the IRS, have on the Duke Employees' Retirement Plan’s structure and benefits? How should employees approach understanding these changes in the context of their personal retirement strategies?
Impact of Legislative Changes: Changes introduced by the IRS or other regulatory bodies can impact the structure of the Duke Employees' Retirement Plan and its benefits. Employees should stay informed about these changes and how they affect personal retirement strategies, particularly regarding tax laws and pension calculations.
How can employees at Duke University contact the Retirement Board for questions or clarifications regarding their retirement benefits? What is the best approach for reaching out to ensure that they receive timely and accurate information?
Contacting the Retirement Board: Employees can contact Duke's Retirement Board for any questions or clarifications regarding their retirement benefits. The Retirement Board is responsible for managing the Plan, and employees are encouraged to reach out directly for timely and accurate information to address any concerns about their retirement.
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