Healthcare Provider Update: Healthcare Provider for Moog Moog Inc. typically provides health benefits through various healthcare providers, including large national insurers such as Aetna, UnitedHealthcare, and Blue Cross Blue Shield. The specific provider may vary by location and plan options available to employees. Healthcare Cost Increases in 2026 for Moog Employees In 2026, Moog employees are likely to face significantly higher healthcare costs, primarily driven by anticipated premium hikes in the ACA marketplace, which could reach up to 66% in some states. As employers like Moog adjust their benefit structures in response to rising medical costs, employees may see changes in deductibles and out-of-pocket expenses. With nearly 51% of large employers expected to shift more costs onto workers, understanding these changes and preparing for increased healthcare expenses will be essential for Moog employees navigating their health coverage options. Click here to learn more
What Is an Immediate Annuity?
While there are many variations of immediate annuities, the basic terms are simple: you give a single lump-sum of money to an annuity issuer (an insurance company) which pays you a fixed income for a fixed period of time or for the rest of your life or for the joint lives of you and another. Immediate annuities appeal to those investors who want a guaranteed income they cannot outlive.
Caution: Guarantees are based on the claims-paying ability of the annuity issuer.
Who Should Consider an Immediate Annuity?
An immediate annuity can be a useful financial tool. Moog employees may want to speak to a financial professional about immediate annuities if:
- You want a stream of income you cannot outlive.
- You have a sum of money that you would like to turn into a regular source of income and aren't interested in leaving the money to your heirs. If you want to leave a portion of the money as a legacy, an immediate annuity may not be a good choice. However, the guaranteed income furnished by an immediate annuity may replace income provided by other assets, allowing those other assets to be left as a legacy.
- You are uncomfortable with investments that have a significant risk of loss. Financial professionals reason that with proper planning, most retirees can make their savings last until they die without buying an immediate annuity. However, to do this, you may have to invest at least some of your savings in equity investments. If subjecting your money to the risk of loss associated with investing in equities does not appeal to you, an immediate annuity provides a way to transfer that risk to an insurance company. While the income guaranteed by the immediate annuity is subject to the claims-paying ability of the annuity issuer, the immediate annuity payments are not subject to stock market risk.
- You expect to live for a long time. If you're healthy and have longevity in your family, an immediate annuity may be an appropriate choice for you.
Strengths
Some of the benefits of immediate annuities are:
- Security and safety. An immediate annuity can provide a guaranteed income stream you can never outlive. If lifetime income is needed for a specific duration, an immediate annuity can provide guaranteed income payments for a fixed period of time.
- Simplicity. You do not have to manage or worry about your investments, watch markets, report interest or dividends.
- Tax treatment. Due to the exclusion ratio applied to determine that portion of your income payments which you treat as ordinary income, a portion of the payments you receive are treated as a return of your investment and are not treated as ordinary income.
Caution: Guarantees are subject to the claims-paying ability of the annuity issuer.
Tradeoffs
- If you chose a life-only payout option, you may not live long enough to receive a return on all of your investment. If payments end at your death, the lack of income could adversely affect your family.
- You relinquish control over the money you use to pay the immediate annuity premium. Should you need a large sum due to illness or another emergency, you may not be able to access it. Consider carefully the available immediate annuity options.
Tip: Some annuity issuers allow you to accelerate payments due to poor health, or you may be able to receive a lump sum (commuted payment) during certain periods of time and for specified amounts. These options may be available for an additional charge depending on the issuer.
- Your immediate annuity payments may not keep up with your spending needs or inflation. Since immediate annuities are not designed for maximum investment return, you may find that alternative investments pay a potentially higher yield for the same investment, but have a proportionately higher risk.
Tip: Moog employees should c ompare the potential risk of loss to the alternative investment due to adverse market conditions against the guaranteed income paid from the immediate annuity, regardless of market conditions.
Caution: Guarantees are subject to the claims-paying ability of the annuity issuer.
How Does an Immediate Annuity Work?
As the name implies, an immediate annuity begins to pay you a stream of income immediately. The amount of income you receive is based on a number of factors. First, immediate annuity payments are computed using actuarial tables. These tables take into account the annuitant's life expectancy. It's the annuitant’s life that determines the timing and amount of the payments. Often, the annuity owner is also the annuitant, but not always. In the case of joint and survivor annuity options, an actuarial table using both the annuitant's age and the designated survivor's age is applied to calculate the amount of the periodic payments.
Second, the payments are based on the underlying interest rate the annuity issuer pays on the premium. The higher the interest rate, the higher the annuity payment will be.
Third, immediate annuity payments are determined according to the distribution option you chose. Longer payout periods, such as payments for life, will usually yield smaller payments than shorter, fixed payout periods, such as five or ten years.
A Note About Variable Annuities
Variable annuities are long-term investments suitable for retirement funding and are subject to market fluctuations and investment risk including the possibility of loss of principal. Variable annuities contain fees and charges including, but not limited to mortality and expense risk charges, sales and surrender (early withdrawal) charges, administrative fees and charges for optional benefits and riders.
Caution: Variable annuities are sold by prospectus. Moog employees should consider the investment objectives, risk, charges and expenses carefully before investing. The prospectus, which contains this and other information about the variable annuity, can be obtained from the insurance company issuing the variable annuity, or from your financial professional. You should read the prospectus carefully before you invest.
Caution: Certain riders and options relating to immediate annuities may be available for an additional fee or charge, depending on the issuer. Moog employees should read the annuity's prospectus or contract for a description of the available options and associated fees and charges, if any.
Immediate Annuity Payout Options
Life Only Annuity Option
This option provides a guaranteed income for life. The income payments stop on the annuitant's death. While this option will generally yield larger payments, it is possible you may not live long enough to receive the return of all of your original investment.
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Installment Refund Annuity Option
If you are concerned about not living long enough to receive all of your investment back, this option provides an alternative. The annuity issuer not only guarantees payments for the annuitant’s life, but it also guarantees that the total of these payments will never be less than the premium you paid to the annuity issuer. If the annuitant dies before your original investment is repaid, the beneficiary you name in the annuity contract will continue to receive payments until the full amount of your investment is paid back.
Cash Refund Annuity Option
This option is very similar to the installment refund option except that if the total annuity payments received are less than the premium you paid, your beneficiary will receive the balance of your original premium in a lump sum (as opposed to periodic payments).
Life Annuity with Period Certain Option
With this option, the annuity issuer does not guarantee the return on your investment, rather it guarantees a minimum period of time during which payments will be made. If the annuitant dies prior to the end of the specified period you selected (usually between 5 and 50 years), the payments will continue to be made to your beneficiary for the remainder of the period, but no longer.
Joint and Survivor Annuity Options
This option provides a guaranteed income for as long as either joint annuitant is alive. When either annuitant dies, payments continue to be made for the life of the surviving annuitant. You can elect that these 'survivor' payments remain the same, or be reduced to a percentage of the original payment, such as two-thirds. The joint and survivor option can also be added to the life with period certain option. In this case, the annuity issuer will make payments until both annuitants have died or for the period of time you selected, whichever is longer.
Joint and Contingent Survivor Annuity Option
This option provides a guaranteed income for as long as you or your joint contingent annuitant lives. If you, the primary annuitant, die first, payments will continue. However, they will decrease to 50 percent of the original payment amount. If the joint contingent annuitant dies first, annuity payments will continue to be received, without reduction, but only for the remainder of your life.
Period Certain Annuity Option
Instead of making payments for the life(s) of the annuitant(s), this option provides a guaranteed payment for the period of time you specify (i.e., 5, 10, 15 or 20 years). If you die prior to the end of this period, your beneficiary will continue to receive payments for the remainder of the fixed period.
Other Immediate Annuity Options
Cost of Living Adjustment (Inflation) Rider
This rider reduces the initial payment you would receive from the immediate annuity without the rider, but payments increase by one to five percent annually thereafter. This rider is intended to offset the effects of inflation on the income payments received.
Impaired Risk (Medically Underwritten) Rider
This option may be added to an immediate annuity or it may be sold as a separate immediate annuity. If you have a medical condition that reduces your “actuarial” life expectancy, the impaired risk rider allows you to receive a larger income payment for the same premium or the same income payment for a lower premium payment, based on your older, “actuarial” age as opposed to your actual age.
Commuted Payout Rider
This rider allows you to withdraw a lump sum from your immediate annuity in addition to the payments already being received. This option usually is available for a limited period of time and may be limited to a maximum dollar amount and/or a maximum percentage of the premium you paid to the annuity issuer.
Variable Payments
This option allows you to withdraw a larger sum than your regular payment at certain times (for instance on the anniversary of your purchase).
Variable Immediate Annuity
Variable immediate annuities offer a variety of investment options, called subaccounts. Your immediate annuity payments can increase or decrease in value depending on the performance of these subaccounts.
Immediate Annuity Strategies
While most financial professionals suggest that you do not devote all of your savings to an immediate annuity, there are many strategies involving immediate annuities that may prove useful to you.
Fund Long-Term Care or Life Insurance Premiums
Many people have the need for long-term care and/or life insurance, although many of these same people will not purchase either type of insurance primarily because of its cost. For our clients from Moog that have an asset, such as a CD, stock, or mutual fund, which they do not intend to use or spend, we suggest that Moog client consider liquidating that asset and investing it in a single premium immediate annuity. You can use the annuity payments to pay the premium cost of long-term care insurance, life insurance, or both. The amount of the immediate annuity payments will be based on your age, the premium paid to purchase the immediate annuity, and the payment option you select. This strategy allows you to convert an unused asset to one which is needed.
Provide Income for a Child with Special Needs or a Spendthrift
Some families must care for a child with special needs. Providing financial support for the child after you die is very important. Investing some of your estate proceeds in an immediate annuity can ensure a steady flow of income for the child’s benefit for his/her entire lifetime.
What if you'd like to leave your child an inheritance comparable in value to your other children, but you fear that the child will squander or misuse his inheritance to his/her detriment? An immediate annuity can be used to control the flow of income to the spendthrift child.
In either case, you can direct in your will or trust that at your death, a specified amount of cash be used to purchase an immediate annuity for the benefit of your child. Frequently, the annuity income will be paid into a special type of trust, usually established at your death. This 'special needs trust' (or supplemental needs trust) is an estate planning tool that can help you provide for the needs of a disabled individual without jeopardizing his or her eligibility for government benefits. A spendthrift trust protects a trust beneficiary from creditors or other parties (e.g., a divorcing spouse). A spendthrift trust specifically prevents the beneficiary from transferring his or her interest which may eliminate the ability of a creditor from accessing the interest. Thus, immediate annuity payments within the trust are protected from most claims of the beneficiary's creditors. A qualified attorney can help you establish and administer these types of trust.
Caution: Spendthrift trusts are not valid in all states.
The Split Annuity Strategy
This strategy is intended to provide a dependable income with principal preservation. It uses a lump sum of money, a portion of which is invested in a single premium fixed-term immediate annuity with the balance invested in a single premium deferred annuity. The immediate annuity pays you a fixed amount over a specified period of time. The deferred annuity grows on a fixed interest basis, with the goal being that by the time the immediate annuity payments end, the deferred annuity will be fully restored to your original starting principal. You can then restart the process with prevailing interest rates or re-evaluate your Moog retirement and investment strategy as needed.
The split annuity concept is useful as an asset management tool when fixed or regular payments need to be made over a set period of time. For example, the immediate annuity payments of the split annuity can be used to make payments on a mortgage, while the deferred annuity is simultaneously growing back to the original amount of your total investment.
Also, a split-annuity strategy can be used in retirement to generate an immediate, steady income stream while preserving some retirement savings for the future. The deferred annuity is intended to grow to reach the original amount of your investment; however, if you need to dip into your principal, most deferred annuities allow some penalty-free withdrawals.
Tax Treatment of Immediate Annuities
Payments received from a non-qualified annuity are divided into two parts: a non-taxable portion that represents the return of capital and a taxable portion that represents the earnings on the annuity. It's important for Moog employees to note that, as a result, only a portion (i.e., the portion representing premiums paid) is excluded from your gross income. The portion of each annuity payment that is excludable is determined by multiplying each payment by an exclusion ratio. The fixed annuity exclusion ratio equals:
your investment in the contract ÷ expected return = exclusion ratio.
Example: You have a fixed immediate annuity that pays you $200 a month for 20 years. Your expected return is $200/month x 20 years x 12 months/year = $48,000. If you have an investment in the contract of $24,000, your exclusion ratio is $24,000/$48,000 = 50 percent. As a result, 50 percent of each $200 payment ($100) is excludable from your gross income. The rest of the payment ($100) is treated as ordinary income.
Caution: The rules are different for variable immediate annuities. Since variable immediate annuity payments fluctuate in value, it is impossible to estimate the expected return at the starting date of the annuity. Typically, the excludable portion is determined by dividing the amount you invested in the immediate annuity by the number of years over which it is anticipated the annuity will be paid. This calculation may vary depending on the annuitization option (i.e. life only, period certain, etc.) chosen.
Estate Taxation of Immediate Annuities
If you select a single life-only payment option, your annuity payments stop at your death. There are no estate tax implications because no part of the annuity is transferred.
If you buy a joint and survivor immediate annuity, at the death of one of the joint annuitants, payments will continue for the remaining life of the surviving annuitant. However, the value of the joint and survivor immediate annuity that the deceased annuitant paid for will be includable in the estate of the deceased annuitant. The amount included is the amount the same annuity issuer would charge the survivor for a single life annuity as of the date of the first annuitant’s death. If the joint annuitant is the surviving spouse, the interest qualifies for the marital deduction. In addition, the surviving joint annuitant receives an income tax deduction for any estate tax attributable to the annuity.
The Retirement Group is not affiliated with nor endorsed by fidelity.com , netbenefits.fidelity.com , hewitt.com , resources.hewitt.com , access.att.com , ING Retirement, AT&T, Qwest, Chevron, Hughes, Northrop Grumman, Raytheon, ExxonMobil, Glaxosmithkline, Merck, Pfizer, Verizon, Bank of America, Alcatel-Lucent or by your employer. We are an independent financial advisory group that focuses on transition planning and lump sum distribution. Please call our office at 800-900-5867 if you have additional questions or need help in the retirement planning process.
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 company’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…).
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