'As Roth catch-up rules reshape contribution strategies for higher earners in 2026, ExxonMobil employees should revisit how their workplace plans, HSAs, and IRA options fit together within a broader retirement framework,' – Patrick Ray, a representative of The Retirement Group, a division of Wealth Enhancement.
Healthcare Provider Update: Healthcare Provider for ExxonMobil For the upcoming year, ExxonMobil's primary healthcare provider is Blue Cross and Blue Shield of Texas (BCBSTX). Effective from January 1, 2025, employees and their families will access healthcare through BCBSTX, ensuring improved network access and support for managing healthcare costs. Prescription drug services will continue to be provided by Express Scripts. Potential Healthcare Cost Increases in 2026 In 2026, ExxonMobil may experience significant healthcare cost increases, paralleling broader trends in the Affordable Care Act (ACA) marketplace. With some states projecting premium hikes of over 60% and the potential loss of enhanced federal premium subsidies, many employees could see their out-of-pocket costs escalate dramatically. The Kaiser Family Foundation has highlighted that without congressional action, most marketplace enrollees might face increases exceeding 75%. These combined pressures will necessitate careful planning and strategic healthcare decisions from ExxonMobil employees going into 2026. Click here to learn more
'With mandatory Roth catch-up contributions beginning in 2026 for higher earners, ExxonMobil employees should take a coordinated approach to their 401(k), HSA, and IRA strategies to align income, timing, and long-term retirement goals,' – Wesley Boudreaux, a representative of The Retirement Group, a division of Wealth Enhancement.
In this article, we will discuss:
(1) How the SECURE 2.0 Act changed catch-up contribution rules beginning in 2026.
(2) What mandatory Roth treatment for higher earners means for workplace retirement planning.
(3) Additional tax-advantaged strategies ExxonMobil employees may want to review as part of a broader retirement planning approach.
The way some higher-income employees make catch-up contributions to their employer retirement plans has changed beginning in 2026. This may directly impact many ExxonMobil employees who are age 50 or older and earning above certain compensation thresholds.
Several legislative provisions that broaden or mandate Roth treatment in specific situations—such as requiring Roth catch-up contributions for certain higher earners—were included in the SECURE 2.0 Act of 2022 (Division T of the Consolidated Appropriations Act, 2023).
The IRS has issued guidance clarifying the implementation timeline and wage threshold under Section 603 of SECURE 2.0.
What Is the New Rule Regarding Catch-Up Contributions to 401(k)s?
If you are age 50 or older and your prior year Federal Insurance Contributions Act (FICA) wages from the employer sponsoring your retirement plan exceed the applicable threshold, your catch-up contributions must now be made as Roth contributions.
For 2026 catch-up treatment purposes, the threshold is based on 2025 FICA wages exceeding $150,000 (indexed for inflation in future years). 1
Roth 401(k) contributions are made with after-tax dollars, meaning they are not deductible in the current tax year. However, if eligible Roth 401(k) distributions are taken after the five-year holding period and after age 59½, due to disability, or after death, those distributions are generally tax-free.
2026 Contribution and Catch-Up Amounts
2026 Limits: 2
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- Employee elective deferral limit: $24,500
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- Catch-up (age 50+): $7,500
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- Catch-up (age 60–63): $11,250 (if permitted by the plan)
The total annual defined contribution limit (employee + employer contributions) for 2026 will be $72,000, excluding catch-up contributions.
If 2025 FICA wages exceed $150,000, 2026 catch-up contributions must be made on a Roth basis.
Under current law, this Roth catch-up requirement is a statutory change that does not expire unless amended by Congress.
Plans that do not offer designated Roth contributions may be unable to allow catch-up contributions once the IRS transition period concludes, which generally began in 2026.
If prior year FICA wages are below the threshold, the required Roth rule does not apply.
Other Factors to Consider When Planning for Retirement
If the catch-up rule change affects your strategy, it may be worth reviewing other tax-advantaged options available to ExxonMobil employees.
1. Consider a Health Savings Account (HSA)
If enrolled in an HSA-eligible health plan, an HSA offers several tax features:
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Contributions are not subject to federal income tax.
-
Earnings grow tax-free.
-
Withdrawals for qualified medical expenses are tax-free.
Contributions made through payroll deduction are generally not subject to FICA or FUTA taxes.
After age 65, HSA funds may be used for non-medical expenses without penalty, though withdrawals are taxed as ordinary income.
HSA Contribution Limits
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2026: 3
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- $4,400 (individual)
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- $8,750 (family)
Individuals age 55 or older who are not enrolled in Medicare may contribute an additional $1,000 catch-up amount.
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2. Increase Regular 401(k) Contributions
The employee elective deferral limit increases to $24,500 in 2026.
This limit applies only to employee contributions and does not include employer matching contributions.
3. Review Partial Roth IRA Contributions
Eligibility for Roth IRA contributions is based on modified adjusted gross income (MAGI).
- 2026 Phase-Out Ranges: 2
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Single: $153,000 to $168,000
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Married filing jointly: $242,000 to $252,000
- Direct Roth IRA contributions are not permitted above the upper phase-out limit. Contributions for a prior tax year may generally be made up until the tax filing deadline of the following year.
Roth 401(k)s and Roth IRAs each have separate five-year aging requirements for qualified distributions.
4. Review a Traditional IRA
For 2026, the IRA contribution limit is $7,500, with a $1,100 catch-up for those age 50 or older.
Even if participating in a workplace retirement plan, non-deductible contributions may still be made to a traditional IRA up to the annual limit. Earnings grow tax-deferred, though non-deductible contributions do not reduce current taxable income.
5. Consider a “Backdoor” Roth IRA Strategy
A “backdoor” Roth IRA involves making a non-deductible contribution to a traditional IRA and then converting it to a Roth IRA.
Owning other traditional IRAs with pre-tax assets can affect the tax treatment of conversions due to pro-rata rules.
Converted Roth amounts must meet a separate five-year aging rule to avoid certain penalties.
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Why Professional Guidance Matters for ExxonMobil Employees
Changes to catch-up contribution rules and shifting contribution limits can influence long-term retirement planning decisions. Coordinating 401(k) contributions, IRAs, HSAs, and Roth strategies often involves detailed analysis of income levels, plan design, and tax considerations—particularly for ExxonMobil employees with higher earnings.
The Retirement Group can help you understand how these new regulations apply to your personal situation and assist in building a retirement strategy aligned with your long-term goals. To speak with a retirement planning professional, call (800) 900-5867.
Sources:
1. Kelley R. Taylor. “Roth 401(k) Changes: New Rules to Know for 2025 and 2026 Taxes.” Kiplinger , 2 Feb. 2026, www.kiplinger.com/taxes/roth-401k-changes-what-you-should-know .
2. United States, Department of the Treasury, Internal Revenue Service. “401(k) Limit Increases to $24,500 for 2026, IRA Limit Increases to $7,500.” IRS Newsroom , 13 Nov. 2025, www.irs.gov/newsroom/401k-limit-increases-to-24500-for-2026-ira-limit-increases-to-7500 .
3. Cross, Diane. “2026 Benefit Limits: HSA, HDHP, and ACA.” Sequoia , 15 May 2025, www.sequoia.com/2025/05/2026-benefit-limits-hsa-hdhp-and-aca/ .
How does the ExxonMobil Savings Plan compare against typical retirement savings plans, and what unique features does it offer that can benefit employees approaching retirement? Additionally, can you elaborate on the necessary steps ExxonMobil employees should take within the savings plan to ensure maximum contributions and employer match during their service years?
ExxonMobil Savings Plan: ExxonMobil's Savings Plan offers flexibility with pre-tax, after-tax, and Roth contributions, and features a 7% company match for the first 6% of employee contributions, a unique benefit compared to typical plans. Employees should contribute the maximum percentage to receive the full match and regularly review their investment allocations through the Voya platform(ExxonMobil_2024_ExxonMo…).
What are the eligibility criteria for employees to participate in the ExxonMobil Pension Plan, and how is the retirement benefit calculated? As employees consider their long-term savings strategy, how does the option of a lump-sum distribution versus an annuity influence their financial planning at ExxonMobil?
ExxonMobil Pension Plan: Employees are automatically enrolled and eligible for benefits after five years of service, with full retirement benefits offered at 55 with 15 years of service. The pension is calculated based on 1.6% of final average pay multiplied by years of service, minus a social security offset. Lump-sum and annuity options affect long-term financial planning, with lump sums offering immediate flexibility while annuities provide a steady income(ExxonMobil_2024_ExxonMo…).
In what ways does the ExxonMobil Employee Assistance Program (EAP) support employees during personal or family crises, and what confidentiality measures are in place to protect their privacy? Additionally, how can ExxonMobil employees access these services, and what are the key resources available through this program?
Employee Assistance Program (EAP): ExxonMobil's EAP provides confidential counseling services for personal and family issues like anxiety, addiction, and family conflict. Services are accessible by phone, video chat, or text, with privacy strictly protected. Employees can contact ComPsych for guidance and support through the GuidanceNow app or website(ExxonMobil_2024_ExxonMo…).
With the introduction of Flexible Spending Accounts (FSAs) at ExxonMobil, how do these accounts help employees manage their health care and dependent care expenses more effectively? What guidelines should employees follow to ensure they maximize their tax advantages while complying with IRS regulations during the enrollment process?
Flexible Spending Accounts (FSAs): FSAs at ExxonMobil allow employees to reduce taxable income by contributing pre-tax dollars to healthcare or dependent care expenses. Employees should estimate their expenses carefully during the enrollment period and comply with IRS rules, ensuring they submit claims by April 15th of the following year(ExxonMobil_2024_ExxonMo…).
How does ExxonMobil define "work-life balance," and what specific benefits and programs are in place to support this philosophy for employees? Can you discuss how employees can utilize these options, such as flexible schedules and leave of absence policies, without negatively impacting their career progression within the company?
Work-Life Balance: ExxonMobil promotes work-life balance with programs like “Flex Your Day,” allowing flexibility in work hours, and up to 20 days of back-up dependent care. Employees are encouraged to use these options strategically to maintain career progression while balancing personal obligations(ExxonMobil_2024_ExxonMo…).
In light of the various medical plan options offered at ExxonMobil, how should employees approach selecting the right plan to best meet their healthcare needs? What factors should they consider, including family health history and financial implications, when making their decisions?
Medical Plan Selection: ExxonMobil offers Aetna POS II and network-only options, allowing employees to choose between plans based on cost, coverage, and provider access. Employees should assess their family's healthcare needs, financial situation, and preferred providers when selecting the most appropriate plan(ExxonMobil_2024_ExxonMo…).
For ExxonMobil employees nearing retirement, what resources are available to help them understand the nuances of health benefits coordination through Medicare and their ExxonMobil coverage? How can they best navigate this transition, and what checkpoints should they be aware of to ensure they remain compliant with company policies during retirement?
Retirement Health Benefits and Medicare: ExxonMobil offers resources to help employees coordinate health benefits with Medicare upon retirement. Employees nearing retirement should explore their options through the Your Total Rewards portal and ensure compliance with company policies during the transition(ExxonMobil_2024_ExxonMo…).
What financial education resources does ExxonMobil provide to employees to promote informed decision-making about their retirement savings and benefits? Can you detail how programs like the Financial Fitness Program enable employees to strategically manage their finances and plan for retirement?
Financial Education Resources: ExxonMobil's Financial Fitness Program, provided in collaboration with Ernst & Young, helps employees manage their finances with resources such as EY Navigate and personalized financial planning. This program supports informed decision-making about retirement and savings strategies(ExxonMobil_2024_ExxonMo…).
As part of the benefits provided by ExxonMobil, how does the company facilitate employee participation in volunteer programs and charitable activities through the ExxonMobil Foundation? How can employees engage with these initiatives while also balancing their work commitments?
Volunteer Programs: Through the ExxonMobil Foundation, employees can engage in charitable activities via the Volunteer Involvement Program (VIP), which offers grants to nonprofits based on time spent volunteering. Participation in these programs is flexible, enabling employees to balance work commitments with volunteer efforts(ExxonMobil_2024_ExxonMo…).
How can ExxonMobil employees get in touch with benefits representatives to address specific questions about their retirement and savings plans? What are the recommended channels and best times to reach out for assistance to ensure they receive timely and relevant information about their options?
Contacting Benefits Representatives: Employees can reach out to the ExxonMobil Benefits Service Center at 833-776-9966 during business hours (8 a.m. to 4 p.m. CST) for assistance with retirement and savings plan questions. The Your Total Rewards portal also offers 24/7 access for reviewing and managing benefits(ExxonMobil_2024_ExxonMo…).
With the current political climate we are in it is important to keep up with current news and remain knowledgeable about your benefits.
ExxonMobil offers a traditional defined benefit pension plan that provides a monthly retirement benefit. Employees can choose between a lump-sum payment or a monthly annuity. The plan calculates benefits based on final average pay and years of service.
Layoffs and Restructuring: ExxonMobil announced plans to lay off approximately 1,900 employees in 2024 as part of its ongoing restructuring efforts. These layoffs are aimed at improving cost efficiency and adapting to market changes amidst fluctuating oil prices (Sources: MarketScreener, Nasdaq). Facility Closures: The company is closing its Clinton, New Jersey facility, leading to the loss of hundreds of jobs. Most affected employees are being offered roles at the Houston headquarters (Source: ROI-NJ). Operational Strategy: The restructuring is part of ExxonMobil's broader strategy to consolidate its North American research and technology operations in Houston, which is expected to enhance research capabilities and drive long-term growth (Source: ROI-NJ).
ExxonMobil provides RSUs that vest over time, offering employees shares upon vesting. They also grant stock options, allowing employees to buy shares at a set price.
ExxonMobil offers a comprehensive benefits package that addresses a wide range of employee needs. For 2023, the company continued to provide robust health insurance options, including various medical, dental, and vision plans. These plans offer extensive coverage for preventive care, major dental services, and comprehensive vision care, including allowances for lenses and frames or contact lenses. Notably, the medical plans also cover telemedicine services, second opinion services, and enhanced fertility benefits. This reflects ExxonMobil's commitment to ensuring its employees have access to high-quality healthcare options that cater to their specific needs. In 2024, ExxonMobil has introduced several enhancements to its benefits offerings. The Employee Health Advisory Program provides professional counseling services for mental health issues, including anxiety, depression, and family conflicts, in a confidential environment. Additionally, the company continues to support employees through a pre-tax spending plan, allowing them to make tax-free contributions to cover eligible health care and dependent care expenses. These benefits are particularly relevant in today's economic and political climate, where managing healthcare costs and ensuring mental well-being are critical. ExxonMobil's focus on comprehensive and flexible healthcare benefits underscores its commitment to supporting the overall well-being of its employees.
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