Healthcare Provider Update: Verizon collaborates with Aetna as its primary healthcare provider, offering a range of health plans and services to its employees and their families. Looking ahead to 2026, the healthcare landscape is poised for significant change, as record hikes in Affordable Care Act (ACA) premiums are anticipated. With some states facing increases exceeding 60%, many individuals could see their out-of-pocket premiums rise by more than 75%, particularly if enhanced federal premium subsidies are not extended. This scenario could create an additional burden for Verizon employees, emphasizing the importance of strategic planning for healthcare coverage amidst such dramatic shifts in costs. Click here to learn more
'Verizon employees can benefit from reviewing how changing interest rates affect income strategies, and thoughtfully structured bond ladders may help support long-term goals when constructed with care and guidance' – Wesley Boudreaux, a representative of The Retirement Group, a division of Wealth Enhancement.
'With interest rates shifting, Verizon employees should focus on thoughtful income planning, and disciplined strategies like bond ladders can help provide greater consistency in an evolving market environment' – Patrick Ray, a representative of The Retirement Group, a division of Wealth Enhancement.
In this article, we will discuss:
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How bond yields and Federal Reserve rate changes affect income strategies.
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Why bond laddering can be useful for managing risk and creating steady income.
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Key considerations before building a bond ladder for retirement planning.
Key Takeaways
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- Even after the Federal Reserve recently lowered interest rates, bond yields remain at levels that can generate income for retirement planning, which may be of interest to Verizon employees.
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- Holding bonds with different maturities—known as a bond ladder—can help manage interest rate risk while providing consistent cash flow.
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- Bond ladders are typically constructed using high-quality, non-callable bonds to help maintain steady income.
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- Higher yields on investment-grade bonds have created income opportunities in recent years.
Understanding Bond Yields and Interest Rates
Although a rate cut by the Federal Reserve does not promise lower yields across all types of bonds, there is often a relationship between policy changes and overall bond yields. Various economic conditions can influence yields, particularly for longer-term bonds.
For example, in August 2020, the 10-year U.S. Treasury yield dropped to a low of 0.55% amid ongoing concerns around the pandemic. 1 As the Federal Reserve began to target inflation, the yield started to climb, reaching 4.05% by the end of October 2025. 1
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Following September's rate cut, longer-term yields rose slightly higher, moving independently of shorter-term yields—such as those from money market funds and newly issued certificates of deposit (CDs)—which declined. 2 Verizon employees evaluating fixed income strategies may want to consider both dynamics.
Prospects for Bond Strategies
Industry analysts largely agree that yields on investment-grade bonds with longer maturities may not decline significantly in the near future. 3 As such, income from a well-structured bond strategy could outpace inflation. According to the Federal Reserve's September 2025 Summary of Economic Projections, personal consumption expenditures (PCE) inflation for 2026 is expected to be 2.6%. 4
What Is a Bond Ladder?
A bond ladder is a portfolio of individual bonds with staggered maturity dates. This structure is designed to:
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- Provide regular income
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- Reduce sensitivity to interest rate fluctuations
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- Allow reinvestment of matured bonds at current market rates
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- Help offset price declines caused by rising interest rates, since principal is returned at maturity (assuming no default)
Why Laddering Works in Changing Interest Rate Environments
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- When interest rates fall, previously purchased bonds continue to provide higher yields locked in earlier.
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- When rates rise, shorter-term bonds mature and can be reinvested at higher yields.
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- This method helps spreads reinvestment and interest rate risk over time.
Key Considerations Before Building a Bond Ladder
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Diversification and Adequate Capital
Minimums often start at $1,000 for corporate bonds and $5,000 for municipal bonds. Treasury or CD ladders can work for smaller portfolios. -
Holding Bonds to Maturity
To collect full principal and scheduled payments, bonds are typically held to maturity. Selling early may reduce income or result in transaction costs. -
Issuer Diversification and Default Risk
Lower-rated bonds require broader diversification. AAA-rated U.S. Treasuries are typically considered more creditworthy. -
Choose High-Quality Bonds
Ratings from agencies such as Moody’s and Standard & Poor’s can help investors evaluate issuer strength. -
Callable Bonds
Callable bonds may be redeemed before maturity, which can interrupt expected income and change the timing of returns. -
Maturity Timing and Income Needs
Ladders can be set at fixed intervals, such as every six months or year, depending on income requirements.
Important Points to Keep in Mind
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- A diversified bond ladder does not remove the possibility of losses.
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- Regular coupon payments and principal repayments can help spread risk across issuers.
Need Assistance?
The Retirement Group can help Verizon employees explore income strategies and understand how bond ladders may fit into retirement planning. To speak with a financial advisor, call (800) 900-5867 .
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- Corporate Employees: 8 Factors When Choosing a Mutual Fund
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- Stages of Retirement for Corporate Employees
- 7 Things to Consider Before Leaving Your Company
- How Are Workers Impacted by Inflation & Rising Interest Rates?
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Sources:
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1. VettaFi Advisor Perspectives. ' 10-Year Treasury Yield Long-Term Perspective: October 2025 ,' by Jennifer Nash. 3 Nov. 2025.
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2. Peakhill Capital. ' The Impact of Fed Rate Cuts on Refinancing in the U.S. ,' by Sandor Biderman. 25 Sep. 2025.
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3. Morningstar. ' What Investors Need to Know About the Steepening Yield Curve ,' by Sarah Hansen. 26 Sep. 2025.
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4. Federal Reserve. ' Summary of Economic Projections ,' 17 Sep. 2025.
How does the Verizon Pension Plan facilitate retirement income for long-term employees, and what specific benefits can employees expect when enrolling in the retirement program provided by Verizon? What unique features does the Verizon Pension Plan offer compared to other retirement plans an employee might have encountered, and how can employees maximize the benefits of these features throughout their career at Verizon?
Verizon Pension Plan Benefits: Verizon's Pension Plan offers substantial benefits aimed at facilitating a secure retirement for long-term employees. Upon enrolling in the retirement program, employees can expect defined benefits that are based on their salary and years of service, ensuring a predictable and stable income after retirement. Unique to Verizon, compared to some other plans, may include options for early retirement under certain conditions and a choice between annuity payments or a lump-sum distribution upon retirement. Employees can maximize these features by planning for long-term service and considering their retirement income needs early in their careers.
In what ways can employees at Verizon strategize their rollover decisions when transitioning from the Verizon Pension Plan to other retirement savings plans upon leaving the company? What factors should be considered by Verizon employees to ensure they are making informed choices regarding rolling over funds to a traditional IRA or another qualified employer plan?
Rollover Strategies: When transitioning from the Verizon Pension Plan to other retirement savings options upon leaving the company, employees should strategize their rollover decisions carefully. Factors to consider include the tax implications, the investment options available in the rollover destination, and the timing of the transfer to avoid penalties. Verizon employees should evaluate the benefits of rolling over to a traditional IRA or another employer's plan, considering their future financial needs and retirement goals.
What are the implications of the recent IRS limits for 2024 concerning contributions to retirement plans for Verizon employees, and how does Verizon align its offerings with these federal regulations? Additionally, how can Verizon employees best take advantage of these limits to enhance their retirement savings while adhering to tax regulations?
IRS Contribution Limits: The implications of IRS limits for 2024 are critical for Verizon employees as these limits dictate how much can be contributed tax-deferred into retirement plans. Verizon aligns its offerings with these federal regulations by adjusting contribution limits in their plans accordingly. Employees are encouraged to maximize their contributions to take full advantage of tax-deferred growth, especially when IRS limits increase, thereby enhancing their retirement savings while adhering to tax regulations.
How does the special tax treatment for lump sum distributions from the Verizon Pension Plan affect employees who receive their benefits early or have specific circumstances, such as being born before 1936? What options do these employees have to manage their tax burden effectively, and how can they best navigate these complicated rules while planning for their retirement?
Tax Treatment of Lump Sum Distributions: The special tax treatment for lump sum distributions from the Verizon Pension Plan can significantly affect employees who opt to receive their benefits early or under specific circumstances like being born before 1936. These employees have options to manage their tax burden effectively by opting for ten-year averaging or capital gain treatment on eligible distributions, allowing for a potentially lower tax rate on their pension benefits.
For surviving spouses and alternate payees of Verizon employees, what are the specific benefits available under the Verizon Pension Plan? How do these benefits compare to those available to employees, and what steps must surviving spouses or alternate payees take to ensure they receive their entitled benefits without delays or complications?
Benefits for Surviving Spouses and Alternate Payees: For surviving spouses and alternate payees, the Verizon Pension Plan offers benefits similar to those available to employees, such as annuity payments or lump-sum options. These beneficiaries must take certain steps to ensure they receive their benefits without delays, such as providing necessary documentation and adhering to plan rules. The plan details and processes for claiming benefits should be clearly understood to avoid complications.
How can Verizon employees utilize the resources available through the Verizon Benefits Center to better understand and manage their retirement benefits? What specific tools and services does the Benefits Center provide, and how can these resources assist employees in making informed decisions regarding their pension plan options?
Utilizing Resources at the Verizon Benefits Center: Verizon employees can utilize various tools and services provided by the Verizon Benefits Center to manage and understand their retirement benefits. The Benefits Center offers personalized consultations, detailed plan documentation, and tools for estimating pension benefits and planning retirement income, assisting employees in making informed decisions about their pension plan options.
What challenges might Verizon employees face regarding eligibility and tax withholding when receiving their pension payments, and how can they mitigate these issues? It's crucial for employees to understand the mechanics of eligibility regarding rollovers and payment processing; what key pieces of information should they be aware of to avoid unexpected taxes?
Challenges in Eligibility and Tax Withholding: Verizon employees might face challenges regarding eligibility and tax withholding when receiving pension payments. Understanding the plan's criteria for eligibility, the implications of rollovers, and the impact of mandatory withholding on distributions is crucial. Employees can mitigate these issues by consulting with the Verizon Benefits Center or a tax advisor to ensure compliance and avoid unexpected taxes.
What is the process for Verizon employees wishing to initiate a direct rollover from the Verizon Pension Plan, and what documentation will they need to prepare? Can employees receive assistance from the Verizon Benefits Center during this process, and how does using a direct rollover benefit them compared to other forms of payment?
Direct Rollover Process: The process for initiating a direct rollover involves deciding the destination of the rollover (traditional IRA or another employer plan), completing necessary documentation, and potentially seeking assistance from the Verizon Benefits Center. A direct rollover helps in avoiding immediate taxes and maintaining the tax-deferred status of retirement savings.
In terms of retirement preparedness, how does the pension plan at Verizon accommodate employees’ needs for financial security in their senior years? What additional education or resources does Verizon provide to assure that employees fully understand their retirement options and the importance of planning ahead?
Retirement Preparedness: Verizon's pension plan is designed to accommodate the financial security needs of employees in their senior years. In addition to the pension benefits, Verizon provides educational resources and planning tools to ensure employees understand their retirement options and the importance of early and consistent retirement planning.
How can employees reach out to the Verizon Benefits Center for further information about the pension plan and other retirement benefits? What specific contact methods are available to employees, and how can these interactions enhance their understanding and management of retirement benefits provided by Verizon?
Contacting the Verizon Benefits Center: Verizon employees seeking more information about their pension plan and other retirement benefits can reach out to the Verizon Benefits Center through various contact methods such as phone, email, or online portals. These interactions are crucial for enhancing understanding and effective management of retirement benefits, ensuring employees make the most of the benefits available to them.
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