New Update: Healthcare Costs Increasing by Over 60% in Some States. Will you be impacted?

Is a Rollover into an IRA the Right Move for You as a Freddie Mac Employee?

Healthcare Provider Update: Freddie Mac offers a comprehensive benefits package that includes flexible healthcare plans such as POS, HMO, and high-deductible options with HSAs. Employees also receive dental, vision, life, and disability insurance, along with access to an on-site wellness center and fitness facilities. Additional perks include student loan repayment assistance, adoption and fertility benefits, legal services, commuter subsidies, and generous paid time off. The company contributes to 401(k) plans with matching and automatic contributions, and supports employee well-being through EAPs and backup care services 1. Freddie Mac Healthcare costs in the United States are projected to continue rising through 2026, with insurers proposing significant premium increases for Affordable Care Act (ACA) plans. A recent analysis found that ACA insurers are seeking a median premium increase of 15% for 2026, marking the largest hike since 2018. This surge is attributed to factors such as the anticipated expiration of enhanced premium tax credits, rising medical costsincluding expensive medications and increased hospital staysand a shift in the risk pool towards higher-cost enrollees. Without the renewal of enhanced subsidies, out-of-pocket premiums for ACA marketplace enrollees could increase by more than 75% on average. Click here to learn more

Choosing an IRA rollover means that your money remains tax-advantaged and capable of growth, as in a Freddie Mac-sponsored plan. You may also gain more investment options than what may have been available in your Freddie Mac-sponsored plan. You may also gain oversight of managing these important retirement assets from your trusted Advisor.

If you roll your retirement plan assets over into an IRA account that you already own through your Advisor, you also receive the benefit of combined statements and holistic investment planning, making it easier to track your overall financial situation.

'Receive the benefit of combined statements and holistic investment planning, making it easier to track your overall financial situation.'

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Some of the benefits of rolling your money into an IRA include:

Tax-deferred growth potential: This generally avoids current income tax and distribution penalties when removed from a Freddie Mac-sponsored retirement plan.

More investment choices: This allows for additional contributions, if eligible. IRAs can be combined and handled by one provider, thereby reducing trustee costs and consolidating statements. Protection from creditors in federal bankruptcy proceedings. The combined amount of your required minimum distributions (RMDs) can be taken from any of your Traditional, SEP or SIMPLE IRAs.

However, there are also some important considerations that Freddie Mac should make before rolling over their money into an IRA, these include:

Internal management fees might be higher than in a Freddie Mac-sponsored retirement plan.
Fees and expenses depend largely on the investments you choose.
Loans from an IRA are not allowed.
Early distributions may be subject to a 10% IRS tax penalty in addition to income tax.
RMDs begin April 1 following the year you reach 70½ and annually thereafter; leaving the money in the former Fortune-500 plan may allow RMDs to be delayed until separation from service.
IRAs are subject to state laws governing malpractice, divorce, creditors (outside of bankruptcy), and other lawsuits; leaving the money in the former Freddie Mac-plan may provide additional protection against creditors.
Net unrealized appreciation (NUA) is the difference between what you paid for employer securities and their increased value. You lose favorable tax treatment of NUA if the funds are rolled into an IRA.

Hopefully, these insights will be helpful as you plan your retirement from Freddie Mac.

For more information about this topic, view our e-book here: https://retirekit.theretirementgroup.com/will-your-retirement-plan-retire-with-you-e-brochure-offer

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What type of retirement savings plan does Freddie Mac offer to its employees?

Freddie Mac offers a 401(k) retirement savings plan to help employees save for their future.

Does Freddie Mac match employee contributions to the 401(k) plan?

Yes, Freddie Mac provides a matching contribution to employee 401(k) contributions, up to a certain percentage.

What is the eligibility requirement for Freddie Mac's 401(k) plan?

Employees at Freddie Mac are typically eligible to participate in the 401(k) plan after completing a specified period of service.

Can Freddie Mac employees make pre-tax contributions to their 401(k) plan?

Yes, Freddie Mac employees can make pre-tax contributions to their 401(k) plan, which can reduce their taxable income.

Does Freddie Mac allow after-tax contributions to the 401(k) plan?

Yes, Freddie Mac allows employees to make after-tax contributions to their 401(k) plan.

How often can Freddie Mac employees change their contribution amounts to the 401(k) plan?

Freddie Mac employees can change their contribution amounts to the 401(k) plan during designated enrollment periods or as specified by the plan rules.

What investment options are available in Freddie Mac's 401(k) plan?

Freddie Mac's 401(k) plan offers a variety of investment options, including mutual funds and other investment vehicles.

Is there a vesting schedule for Freddie Mac's matching contributions?

Yes, Freddie Mac has a vesting schedule for matching contributions, which determines when employees fully own those contributions.

How can Freddie Mac employees access their 401(k) account information?

Freddie Mac employees can access their 401(k) account information through the company's designated retirement plan website or portal.

What happens to a Freddie Mac employee's 401(k) account if they leave the company?

If a Freddie Mac employee leaves the company, they can choose to roll over their 401(k) balance to another retirement account, withdraw the funds, or leave the account with Freddie Mac, subject to plan rules.

With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.

Freddie Mac is a government-sponsored enterprise that provides liquidity, stability, and affordability to the U.S. housing market. It supports the housing finance system through its various programs.

Freddie Mac provides RSUs to certain employees. The RSUs vest over a specific period, supporting employee retention.