New Update: Rising Oil Costs are Affecting Retirement Plans. Will you be impacted?
6 Retirement Myths Every W.R. Grace 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. When crude oil prices remain volatile, the effects cascade through supply chains, consumer prices, and financial markets in ways that reach every industry. W.R. Grace employees may not think of themselves as exposed to oil markets, but energy-driven inflation, rate movements, and index fund performance create indirect connections to their financial planning. For W.R. Grace employees building retirement savings, oil-driven inflation and market volatility make disciplined saving and diversified allocation more important, as energy cycles can disrupt both portfolio values and purchasing power. Working with a financial advisor can help you position your planning strategy for sustained energy price uncertainty.
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 W.R. Grace 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 W.R. Grace 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 W.R. Grace 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 W.R. Grace , 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 W.R. Grace 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 W.R. Grace, 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, W.R. Grace retirement benefits are not set in stone. They are subject to change. For example, the significant changes made to W.R. Grace’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: W.R. Grace stock is a good investment
Something W.R. Grace 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 W.R. Grace pension and 401(k) plan (if W.R. Grace 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 W.R. Grace 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 W.R. Grace 401(k) account (If W.R. Grace 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 W.R. Grace, you may leave some or all of your savings in your W.R. Grace 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 W.R. Grace. W.R. Grace has frozen its defined benefit pension to new accruals, meaning your benefit is based on service and compensation accumulated up to the freeze date - but the value already locked in remains a meaningful asset worth analyzing. If a lump sum option is available, IRS segment rates in effect during the plan's lookback period directly affect the present value calculation; rising rates reduce the lump sum amount, so the rate environment at your retirement date matters. Understanding the annuity equivalent of your frozen benefit and comparing it to a potential lump sum is an important step in sequencing your retirement income from multiple sources.
On the healthcare side, W.R. Grace 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 W.R. Grace 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 401(k) plan offered by W.R. Grace?
The 401(k) plan offered by W.R. Grace is a retirement savings plan that allows employees to save a portion of their paycheck before taxes are taken out.
How can I enroll in the W.R. Grace 401(k) plan?
Employees can enroll in the W.R. Grace 401(k) plan by completing the enrollment form available through the HR department or the company’s benefits portal.
Does W.R. Grace match employee contributions to the 401(k) plan?
Yes, W.R. Grace offers a matching contribution to the 401(k) plan, which helps employees boost their retirement savings.
What is the maximum contribution limit for the W.R. Grace 401(k) plan?
The maximum contribution limit for the W.R. Grace 401(k) plan is in accordance with IRS guidelines, which are updated annually.
Can I change my contribution rate to the W.R. Grace 401(k) plan?
Yes, employees can change their contribution rate to the W.R. Grace 401(k) plan at any time, subject to certain restrictions.
What investment options are available in the W.R. Grace 401(k) plan?
The W.R. Grace 401(k) plan offers a variety of investment options, including mutual funds, target-date funds, and other investment vehicles.
When can I start withdrawing funds from my W.R. Grace 401(k) plan?
Employees can start withdrawing funds from their W.R. Grace 401(k) plan upon reaching age 59½ or under certain circumstances such as financial hardship.
Are loans available through the W.R. Grace 401(k) plan?
Yes, W.R. Grace allows participants to take loans against their 401(k) savings, subject to specific terms and conditions.
What happens to my W.R. Grace 401(k) plan if I leave the company?
If you leave W.R. Grace, you can choose to roll over your 401(k) balance to another retirement account, cash out, or leave it in the W.R. Grace plan if eligible.
How often can I make changes to my W.R. Grace 401(k) investment allocations?
Employees can typically make changes to their investment allocations in the W.R. Grace 401(k) plan on a quarterly basis or as specified in the plan documents.
For more information you can reach the plan administrator for W.R. Grace at , ; or by calling them at .
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