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6 Retirement Myths Every Advanced Micro Devices Employee Should Not Fall For!
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Crude oil prices remain elevated and volatile, with annualized volatility around 80% and prices ranging between $50 and $120 per barrel over the past six months. Direct energy consumption, petrochemical inputs for components, and logistics costs create tangible oil price exposure for technology manufacturers. Advanced Micro Devices employees building long-term savings should recognize that oil-driven economic conditions can affect both the growth of their portfolios and the purchasing power of their eventual retirement income. Consulting with a financial advisor can help you understand how energy conditions affect your specific situation and build a plan that adapts accordingly.
During our 30+ years helping retirees, the majority have been very excited to start the planning process. However, some have been surprised to find out our recommendations differ from what they have heard elsewhere.
This is because there’s a lot of misinformation swirling around. As a fiduciary, we are legally obligated to serve your best interests at all times. So, we can tell you achieving the retirement you desire is not going to happen if you’re sidetracked by myths and false information.
That's why we aim to debunk the top six retirement myths that Advanced Micro Devices employees may have heard. Our goal is to help you start building the retirement of your dreams today.
Myth #1: If I receive a pension, I do not have to make any decisions regarding my pension.
If Advanced Micro Devices offers you a defined-benefit plan, your pension is primarily the responsibility of the company. However, that doesn’t mean you just wait for a check in the mail once you retire. You have major decisions to make.
If offered a pension, employees can potentially elect to receive a monthly payout like a traditional pension or they could convert their pension into a one-time lump-sum benefit, which can be subsequently rolled over into an Individual Retirement Account (IRA) and then controlled by the retiree.
So, monthly or lump-sum pension?
Each payout has its own set of pros and cons. Deciding which option is most appropriate for you involves many factors. Deciding which option is most appropriate for you involves many factors. It is best done with the help of a professional, who can incorporate all aspects of your financial life – Social Security, 401(k), real estate, and inheritance into your decision.
Further, married Advanced Micro Devices employees may have survivor benefit options to consider. At retirement, it is possible that you have multiple survivor options to choose from for the monthly pension, but these are only available for a qualified spouse.
Myth #2: If I receive a pension from Advanced Micro Devices , Social Security becomes less important.
Social Security will likely be one of your primary sources of retirement income. And just like your pension, you should carefully consider how best to use it based on your personal needs.
The size of your Social Security benefit is greatly determined by your age when you claim. You can receive your full Social Security retirement benefit upon reaching your Full Retirement Age, which is age 66 or 67, depending on your date of birth. But you can claim a permanently reduced benefit as early as age 62. Delaying Social Security until age 70 entitles you to a higher benefit of up to 8% per year. A benefit at age 70 will be 76-77% higher than the payout if you start at age 62.
Ultimately, factors such as your other income sources, marital status and health should guide your decision, not just when you can get the biggest Social Security paycheck.
Myth #3: When I retire from Advanced Micro Devices doesn’t matter
No, no, no. When you retire has a major effect on the quality of your retirement.
For one, years of service is one of the primary factors in your pension calculation. Generally, the longer you work at Advanced Micro Devices, the higher your pension. Your pension is also impacted by interest rates, which fluctuate. When rates are lowered, lump-sum pension payouts are increased, and vice versa.
Plus, Advanced Micro Devices retirement benefits are not set in stone. They are subject to change. For example, the significant changes made to Advanced Micro Devices’s pension calculation, health care subsidies and retiree health insurance.
You may find that it is more financially advantageous to retire sooner or later than your desired retirement date.
Myth #4: Advanced Micro Devices stock is a good investment
Something Advanced Micro Devices employees should be aware of is that we commonly see employees invest an excessive amount of their 401(k) in their company’s stock. While it can be rewarding to own a piece of a respected company, it may be risky from a retirement planning perspective.
Firstly, most of your financial life becomes dependent on the performance of one company. That includes your current income and retirement income from the Advanced Micro Devices pension and 401(k) plan (if Advanced Micro Devices offers these to you). Such a high concentration of your financial well-being in a single company is risky. Secondly, a single stock can be riskier and more volatile than a mutual fund or the broader stock market. Therefore, the greater amount of Advanced Micro Devices stock you have in your 401(k), the more you can expect your investment return to fluctuate.
It’s more appropriate to diversify the investment choices in your Advanced Micro Devices 401(k) account (If Advanced Micro Devices offers you a 401K). That means selling your company stock and investing in mutual funds. The right mix of funds depends on your specific needs, goals and level of risk you’re comfortable with.
Myth #5: It’s better to leave my 401(k) with my company.
Upon leaving Advanced Micro Devices, you may leave some or all of your savings in your Advanced Micro Devices 401(k) account (If this is offered to you). However, there are a variety of benefits to rolling over your 401(k) to an Individual Retirement Account (IRA). These include greater investment choices, greater withdrawal flexibility, more withholding options, and professional management by an advisor of your choosing.
When done properly, no tax applies to the rollover. One area of your 401(k) that provides no flexibility is tax withholdings.Every withdrawal is subject to a mandatory 20% federal tax plus applicable state taxes.
Myth #6: Medicare will cover my medical expenses
One of the biggest expenses for most people in retirement is health care. Taking the time to review your options can help you plan accordingly and avoid large out-of-pocket costs that could derail your retirement.
Once you turn 65 you are Medicare-eligible You and your Medicare-eligible dependents are required to enroll in Medicare Part A (hospital benefits) and Part B (doctor benefits). These two parts cover about 80% of health care benefits for individuals, so it’s important to consider your supplemental coverage options.
That same shift from growing assets to drawing them down applies directly to the pension decisions in front of you at Advanced Micro Devices. Without a traditional pension, your 401(k) - alongside Social Security - forms the foundation of your retirement income at Advanced Micro Devices. Advanced Micro Devices may offer a 401(k) employer match - review your Summary Plan Description for current match rate and vesting details. Your overall withdrawal strategy, account sequence, and Roth conversion opportunities leading up to and into retirement deserve careful, personalized analysis given the income-sequencing implications.
On the healthcare side, Advanced Micro Devices does not offer continued medical coverage to retirees, which means coverage through the company ends when employment does. Planning for the cost of health insurance during any gap between your retirement date and Medicare eligibility at age 65 is a critical step - marketplace coverage, COBRA continuation, or a spouse's employer plan are common options. Building an accurate estimate of bridge-coverage costs into your retirement income projection prevents underestimating one of the largest variable expenses retirees face. Connecting your specific Advanced Micro Devices benefits situation to a comprehensive retirement income plan - and understanding how each component interacts - gives you the most complete picture of what retirement will look like.
What is the 401k plan offered by Advanced Micro Devices?
The 401k plan offered by Advanced Micro Devices is a retirement savings plan that allows employees to save a portion of their salary on a tax-deferred basis.
How can employees of Advanced Micro Devices enroll in the 401k plan?
Employees of Advanced Micro Devices can enroll in the 401k plan through the company’s HR portal or by contacting the HR department for assistance.
Does Advanced Micro Devices match employee contributions to the 401k plan?
Yes, Advanced Micro Devices offers a matching contribution to the 401k plan, which helps employees grow their retirement savings.
What is the maximum contribution limit for the 401k plan at Advanced Micro Devices?
The maximum contribution limit for the 401k plan at Advanced Micro Devices is in accordance with IRS guidelines, which may change annually.
Can employees of Advanced Micro Devices take loans against their 401k savings?
Yes, employees of Advanced Micro Devices may have the option to take loans against their 401k savings, subject to the plan's specific terms and conditions.
What investment options are available in the Advanced Micro Devices 401k plan?
The Advanced Micro Devices 401k plan offers a variety of investment options, including mutual funds, stocks, and bonds, allowing employees to tailor their portfolios.
How often can employees change their contribution amounts to the Advanced Micro Devices 401k plan?
Employees can typically change their contribution amounts to the Advanced Micro Devices 401k plan at any time, subject to the plan’s rules.
What happens to the 401k savings if an employee leaves Advanced Micro Devices?
If an employee leaves Advanced Micro Devices, they can roll over their 401k savings to another retirement account, cash out, or leave the funds in the current plan if permitted.
Are there any fees associated with the Advanced Micro Devices 401k plan?
Yes, the Advanced Micro Devices 401k plan may have administrative fees and investment-related fees, which are disclosed in the plan documents.
How can employees access their 401k account information at Advanced Micro Devices?
Employees can access their 401k account information through the online portal provided by the plan administrator or by contacting customer service.
For more information you can reach the plan administrator for Advanced Micro Devices at 2485 Augustine Drive Santa Clara, CA 95054; or by calling them at (408) 749-4000.
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