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

Smart Retirement Strategies for WestRock Employees: Unlocking the Benefits of HSAs and IRAs

Healthcare Provider Update: Healthcare Provider for WestRock: WestRock employees typically receive their health care benefits through various providers as part of employer-sponsored insurance plans. Specific details on the primary healthcare provider may vary, but it's known that large companies like WestRock often collaborate with major insurers. To identify the exact provider, employees should consult their HR department, which can provide the most accurate and relevant information. Potential Healthcare Cost Increases in 2026: As WestRock prepares for 2026, employees should brace for significant healthcare cost increases. With the expiration of enhanced federal ACA subsidies and rising medical costs, many workers could face steep premium hikes, potentially exceeding 75%. A recent survey indicates that nearly half of large employers, including WestRock, anticipate transferring more healthcare expenses to employees, raising deductibles and out-of-pocket maximums. This evolving landscape highlights the importance for WestRock employees to understand their benefits and mitigate potential financial impacts. Click here to learn more

When it comes to retirement planning at WestRock, having enough money to maintain your lifestyle in later life is a top priority. Use of Health Savings Accounts (HSAs), Individual Retirement Accounts (IRAs), and the WestRock employer-sponsored plans such as 401(k)s are examples of effective saving techniques. Here, we explore the subtleties of these choices in response to questions from a recent Q&A session held with Fidelity financial experts .

Increasing Retirement Contributions: Wise Decisions

I already make the recommended 15% contributions to my HSA, Roth IRA, and 401(k). How should I distribute any further contributions?

It's impressive that you were able to save at the advised 15% rate. It is important to think about your financial goals as well as the special advantages that each account provides if you want to increase your contributions even further. For example, making the most of WestRock's 401(k) match by contributing up to the maximum amount allowed will guarantee that you receive what is effectively 'free money.' After this, you may want to concentrate on your HSA, especially since health care costs tend to increase with age.

HSA contribution caps for 2024 are $4,150 for single coverage, $8,300 for family coverage, and an extra $1,000 for anyone over 55. Making the most of this can greatly improve your retirement preparation because of the triple tax advantage of health savings accounts (HSAs): donations are tax deductible, the balance grows tax-free, and withdrawals for eligible medical expenses are tax-free.

Moreover, women at WestRock may find it advantageous to boost their contributions to workplace savings plans in light of the gender pay disparity. These plans have 2024 contribution caps of $23,000 for individuals, $69,000 for employer contributions, and $7,500 for catch-up contributions for participants 50 years of age and older.

IRAs, which have a $7,000 general contribution cap and a $1,000 catch-up contribution for individuals over 50 in 2024, provide still another option for saving. Consider investing in brokerage accounts after making the most of tax-advantaged accounts. These accounts don't have the same tax advantages, but they do offer growth and liquidity possibilities.

Selecting Between a Roth 401(k) and a 401(k)

I am 44 years old and have not saved enough for retirement. What distinguishes a Roth 401(k) from a traditional 401(k), and which should I select to optimize my savings?

The decision between a traditional 401(k) and a Roth 401(k) is based on your expected retirement income and current tax status. Traditional 401(k)s allow pre-tax contributions, which lower your current taxable income but necessitate withdrawals that incur taxes. A Roth 401(k), on the other hand, allows for post-tax contributions and, if certain requirements are satisfied, tax-free withdrawals.

If you anticipate being in a higher tax bracket later in life, the Roth 401(k) may be attractive because you have more than 20 years until retirement. To customize this choice for your own situation, it is advised that you speak with a financial counselor.

Alternatives for Retirement in Non-Traditional Work

What choices are there for retirement savings if you work for yourself or don't have a job?

There are various potential retirement savings choices available to individuals who work for themselves or do not have a regular job. A non-working spouse at WestRock may make contributions to an IRA through a Spousal IRA as long as the other spouse files jointly and has a suitable income. The contribution cap is the same as for personal IRAs, except it is limited to the reported taxable income.

Self-employed workers may want to look into a Solo 401(k), which functions similarly to a traditional 401(k) and offers high contribution limits. Additionally appropriate are SEP and SIMPLE IRAs, which allow sizeable contributions but have differing eligibility conditions and tax ramifications.

HSAs are still a great option for retirement savings connected to health costs, particularly if you qualify for a high-deductible health plan. In addition to saving taxes, contributions made to an HSA can be saved and grow tax-free for use after age 65 for other purposes, such as future medical costs.

Comprehending the Roth IRA Backdoor

What is a backdoor Roth IRA and is it necessary for anyone?

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A backdoor Roth IRA is a tactic used to get around income restrictions that would otherwise prevent high incomes from contributing to a Roth IRA; it is not a separate kind of IRA. It entails funding a traditional IRA with non-deductible contributions, which are then converted to a Roth IRA. This approach offers a useful choice for people at WestRock who are unable to directly contribute to a Roth IRA because of income constraints because it permits tax-free growth and withdrawals.

The Wise Application of HSAs

If you don't have frequent medical bills, should you still contribute to an HSA? If yes, how should you spend your money?

It is prudent to make contributions to an HSA even if there are no upcoming medical bills. Because of their triple tax advantage, health savings accounts (HSAs) can be a useful instrument for future financial needs, possibly providing benefits similar to those of typical retirement plans.

When it comes time for retirement, financial planning becomes more important, therefore it's important for WestRock employees getting close to this stage to know about the latest legislation changes that affect IRAs and HSAs. In December 2022, for instance, the SECURE Act 2.0 was passed into law. It brought about a number of changes that would be advantageous to retirees, such as moving the deadline for required minimum distributions (RMDs) from retirement funds from 72 to 73 years old, effective in 2023. This change gives your investments more time to grow, which can be especially helpful if you want to make the most of IRAs and HSAs as part of your retirement plan. Congress.gov (2022) is the source.

Managing retirement savings plans is like planting a well-seasoned garden that will provide fruit in every season. WestRock employees who are approaching retirement should strategically tend to their financial garden, just as a gardener would carefully choose where to plant seeds for maximum sunlight (maximizing your 401(k) contributions up to the employer's match), take steps to enrich the soil (contributing to an HSA for its triple tax advantages), and diversify the types of plants for year-round yield (leveraging both Roth and traditional IRAs for different tax benefits). A prosperous retirement is possible if all available savings tools are utilized to their full potential, just as regular gardening yields consistent and abundant produce.

How does the WestRock Company Consolidated Pension Plan specifically calculate the Normal Retirement Benefit for its employees, and what considerations should employees be aware of regarding the Final Average Pay calculation used by WestRock Company?

Normal Retirement Benefit Calculation: The WestRock Company calculates the Normal Retirement Benefit based on the employee's Final Average Pay. This is defined as the average of the employee's highest five years of earnings over the last ten years of employment before termination. Earnings included in the Final Average Pay are most wages, bonuses, commissions, and amounts deferred under the company’s 401(k) plan. Employees should be aware that earnings after December 31, 2015, are excluded unless they qualify under the Rule of 75(WestRock Company_Issued…).

What are the specific eligibility requirements for the Disability Retirement Pension under the WestRock Company plan, and how does this differ for Legacy Mead and Legacy Westvaco participants within the WestRock Company workforce?

Disability Retirement Pension Eligibility: To qualify for a Disability Retirement Pension, an employee must have earned at least five years of Vesting Service and be deemed "totally and permanently disabled" according to specific criteria. Legacy Mead and Legacy Westvaco participants are subject to special rules detailed in the Legacy Supplement. Legacy Mead employees must apply separate criteria from Legacy Westvaco employees(WestRock Company_Issued…).

In what ways can employees at WestRock Company manage and maximize their Vesting Service to ensure they receive the full benefits from the companyâ€™s pension plan, particularly for those with interrupted service or re-employment?

Vesting Service Maximization: WestRock employees can manage their Vesting Service by ensuring that they complete at least five years of service, which guarantees their right to pension benefits. Employees with interrupted service can still receive credit for Vesting Service if they return within five years. Additionally, employees who leave and return within a year will receive credit for the time they were absent(WestRock Company_Issued…).

How does the WestRock Company handle the transition of benefits for employees who transfer between different positions within the company, and what impacts could this have on their eventual retirement benefits?

Transfer Between Positions: When WestRock employees transfer between different positions, their retirement benefit is calculated based on the greater of two methods. The first method calculates the benefit accrued at each position separately, while the second method applies the total benefit service across positions. Vesting Service is always combined, regardless of location or position(WestRock Company_Issued…).

How does the WestRock Company plan ensure that pension benefits are protected, particularly through the Pension Benefit Guaranty Corporation (PBGC), and what should employees know about their rights and guarantees under this insurance?

Pension Benefit Protection (PBGC): The WestRock Pension Plan is insured by the Pension Benefit Guaranty Corporation (PBGC). This federal insurance guarantees that employees will receive their vested pension benefits even if the plan is terminated. Employees should understand that PBGC coverage has limits, and benefits might be reduced under certain circumstances(WestRock Company_Issued…).

What are the consequences for WestRock Company employees who choose to withdraw from their pension plan or to rollover their benefits upon retirement or termination? How can they navigate these options effectively to avoid penalties?

Withdrawals and Rollovers: Employees can withdraw or roll over their pension benefits upon retirement or termination. Lump-sum withdrawals may be subject to taxes unless rolled over into a qualifying retirement account. Employees should consult the WestRock Benefits Center to avoid penalties and ensure compliance with federal tax regulations(WestRock Company_Issued…).

How does the WestRock Company maintain compliance with federal regulations and best practices under ERISA, and what specific rights do employees have concerning their pension benefits?

ERISA Compliance: WestRock complies with the Employee Retirement Income Security Act (ERISA), ensuring that employees' pension rights are protected. Employees have the right to receive information about their benefits, act prudently, and enforce their rights through the claims and appeals process outlined in the plan(WestRock Company_Issued…).

What resources are available to employees of WestRock Company for understanding their benefits under the Consolidated Pension Plan, and how can they utilize these resources to ensure they make informed decisions about their retirement?

Resources for Understanding Benefits: WestRock provides employees access to the WestRock Benefits Center, where they can obtain information on their pension plan. Employees are encouraged to review the Summary Plan Description and consult with the Benefits Center for clarification on their benefits and to make informed retirement decisions(WestRock Company_Issued…).

How will the integration of employee benefits from various company acquisitions impact current staff at WestRock Company, and what steps is the company taking to communicate these changes effectively to its employees?

Impact of Acquisitions on Benefits: WestRock has acquired various companies over time, and employees from these acquisitions may have different pension rules applied to them. WestRock takes steps to integrate these employees and communicates any changes through the WestRock Benefits Center. Special rules may apply based on the previous employer’s pension plan(WestRock Company_Issued…).

How can employees of WestRock Company get in touch with the WestRock Benefits Center to seek clarification about the Summary Plan Description, and what are the best practices to follow when requesting information regarding their pension plan?

Contacting the Benefits Center: Employees can contact the WestRock Benefits Center for clarification on the Summary Plan Description. Best practices include having detailed questions prepared, reviewing the SPD in advance, and requesting copies of documents or forms that clarify specific aspects of their pension plan(WestRock Company_Issued…).