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Mortgage or Retirement? Where Should MGM Resorts International Employees Put Their Money?

Healthcare Provider Update: Healthcare Provider for MGM Resorts International MGM Resorts International primarily collaborates with various healthcare providers depending on the location and specific needs of their employees. However, the organization does not disclose a singular healthcare provider in publicly available resources. The company typically partners with major health insurance companies to offer medical benefits to its workforce. Potential Healthcare Cost Increases in 2026 As we approach 2026, MGM Resorts International employees are facing significant challenges concerning healthcare costs. With anticipated premium hikes on Affordable Care Act (ACA) marketplace plans, some states may see increases exceeding 60%. Without an extension of enhanced federal premium subsidies, many employees could experience premium surges of up to 75%. This financial burden is compounded by soaring medical costs associated with advances in therapies, such as GLP-1 medications, alongside aggressive rate hikes from top insurers. As a result, employees might find themselves shouldering a greater share of healthcare expenses, necessitating strategic planning to mitigate these anticipated increases. Click here to learn more

'MGM Resorts International employees approaching retirement must balance investment opportunities with debt reduction, and as Patrick Ray of The Retirement Group, a division of Wealth Enhancement Group

'MGM Resorts International employees retiring soon should consider not just the numbers, but also their comfort with debt and financial flexibility—Wesley Boudreaux of The Retirement Group, a division of Wealth Enhancement Group

In this article, we will discuss key factors influencing the decision to allocate extra funds toward investments or mortgage repayment. Specifically, we will explore:

The Financial Trade-Off – Analyzing potential investment returns versus mortgage interest savings.
Risks and Considerations – Understanding market volatility, liquidity, and tax implications.
Personalized Decision-Making – Evaluating individual financial circumstances, debt levels, and retirement goals.

In the world of personal finance, choosing to allocate extra money to investments or debt reduction can be difficult, especially for MGM Resorts International employees nearing or entering retirement. This choice becomes particularly important in situations where a mortgage is one's primary source of debt. This debate's central argument frequently comes down to weighing the expense of debt versus possible investment rewards.

A financial perspective on investing versus accelerated mortgage repayment

The main justification for favoring investments over accelerated mortgage payback stems from the stock market's past success. In particular, the S&P 500 index had an average yearly return of 9.9% (including dividends) between 1965 and 2022. This implies that one could fairly anticipate long-term returns in the range of 7% to 8% for a well-diversified portfolio that includes both equities and bonds.

For the sake of illustration, let us take the following scenario: a person pays 20% down and purchases a $500,000 home, financing it with a 30-year fixed-rate mortgage at 6% interest. Let's say this person inherits $400,000. If this amount was invested with an annual return of 8%, it might gain over $4.03 million over the course of three decades instead of the $863,353 in interest and principal payments related to the mortgage. Though in a very simplified context, this example highlights the financial benefit of investing over quick debt reduction.

The Argument for Mathematical Returns' Inherent Flaws

That being said, there are some who disagree with the case for investing in accordance with mathematical returns. The returns on investments are by their very nature erratic and variable, and they seldom follow the straight line that average annual returns suggest. For example, between 1965 and 2022, the yearly returns of the S&P 500 saw significant fluctuations, ranging from a high of 37.6% to a low of minus 37%. In addition, a sizable fraction of American homeowners benefit from mortgage rates that are lower than 4%, which makes it much more difficult for individuals weighing their options between debt repayment and investment.

Other Things to Think About

When deciding weather to increase mortgage payments versus make investments MGM Resorts International professionals should also consider their financial circumstances. It makes sense to pay off high-interest bills first, especially credit card debt, which has average interest rates close to 25%, before thinking about making extra mortgage payments. Another important factor to take into account is liquidity; whilst house equity is an illiquid asset, equities and exchange-traded funds (ETFs) provide comparatively faster access to capital.

This choice is also influenced by tax implications. In addition to providing instant tax savings, contributions to tax-deferred retirement accounts, like IRAs, increase the allure of investing. Further lowering the cost of borrowing is the opportunity to deduct mortgage interest on loans up to $750,000.

When the loan debt hits 80% of the home's original value, mortgage insurance can be removed, which might result in annual savings of thousands of dollars. This is another factor to consider.

Final Thoughts

To put it simply, a number of factors, such as the mortgage interest rate, investment return expectations, other outstanding debts, liquidity needs, tax implications, and personal comfort with debt levels, influence the decision of whether MGM Resorts International professionals should allocate excess funds toward investments or mortgage repayment. The choice is almost always more complex, even while the economics of investment returns may favor investing, particularly in low mortgage rate situations.

When making this difficult choice, MGM Resorts International professionals must carefully assess their own financial situation, risk tolerance, and long-term goals. Ultimately, moving closer to financial security and peace of mind should be the top priority, regardless of whether debt reduction or investment comes first.

It is important for those who are getting close to retirement to think about the implications of required minimum distributions (RMDs) from retirement accounts, which start at age 72. Choosing to invest more money can result in these accounts being much larger, which could mean higher RMDs. A pleasant retirement may be supported by this greater income, but it may also result in a higher tax burden. Since Roth accounts have no required minimum distributions (RMDs) and retirement withdrawals are tax-free, making strategic investments in Roth IRAs or Roth conversions can provide a tax-efficient solution to handle this situation. (Source: IRS 'Retirement Plan and IRA Required Minimum Distributions FAQs,' last revised March 2023; Internal Revenue Service).

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Making the choice to pay off your mortgage early or put more money down for retirement is like a seasoned sailor choosing the best route to a far-off land. See your retirement as a peaceful, far-off island that you are trying to get to. There is a limited amount of cargo capacity on your yacht, which represents your available finances and your financial strategy. You have two options: either load up on more provisions (investments) to make sure you can comfortably weather any storms and currents along the way, or lower your load by tossing your mortgage overboard to enable a faster, more direct voyage. Every sailor's voyage is distinct, shaped by the winds (market returns) and the state of their vessel (financial circumstances). The trick is to pack your boat as efficiently as possible while maintaining safety, so that when you arrive at retirement island, you have enough money and peace of mind.

Source:

Williams, Rob. 'Should You Pay Off a Mortgage Before You Retire?' Charles Schwab , August 2023, https://www.schwab.com/learn/story/should-you-pay-off-mortgage-before-you-retire .

Hartman, Rachel. 'Should You Pay Off Your Mortgage Before You Retire?' U.S. News & World Report , January 2025, https://money.usnews.com/money/retirement/articles/should-you-pay-off-your-mortgage-before-you-retire .

Ameriprise Financial. 'Is It Better to Pay Off Your Mortgage or Invest?' Ameriprise Financial , 2024, https://www.ameriprise.com/financial-goals-priorities/personal-finance/should-you-pay-off-your-mortgage .

Carter, Erik. 'Should You Save More for Retirement or Pay Off Your Mortgage Early?' Forbes , 11 Oct. 2022, https://www.forbes.com/sites/financialfinesse/2022/10/11/should-you-save-more-for-retirement-or-pay-off-your-mortgage-early .

Vanguard. 'Paying Off Debt Before You Retire.' Vanguard , 2024, https://investor.vanguard.com/investor-resources-education/retirement/planning-paying-off-debt .

What type of retirement savings plan does MGM Resorts International offer to its employees?

MGM Resorts International offers a 401(k) retirement savings plan to help employees save for their future.

Does MGM Resorts International match employee contributions to the 401(k) plan?

Yes, MGM Resorts International provides a matching contribution to the 401(k) plan, which helps employees maximize their retirement savings.

What is the eligibility requirement for employees to participate in MGM Resorts International's 401(k) plan?

Employees of MGM Resorts International are eligible to participate in the 401(k) plan after completing a specified period of service, typically within the first year of employment.

Can employees of MGM Resorts International choose how much to contribute to their 401(k) plan?

Yes, employees at MGM Resorts International can choose their contribution percentage within the limits set by the IRS.

What investment options are available in the MGM Resorts International 401(k) plan?

The 401(k) plan at MGM Resorts International offers a variety of investment options, including mutual funds, stocks, and bonds, allowing employees to diversify their portfolios.

How can MGM Resorts International employees access their 401(k) account information?

Employees of MGM Resorts International can access their 401(k) account information through the company’s designated retirement plan website or mobile app.

Is there a vesting schedule for the employer match in MGM Resorts International's 401(k) plan?

Yes, MGM Resorts International has a vesting schedule for the employer match, meaning employees must work for a certain period to fully own the matched contributions.

What happens to my 401(k) plan if I leave MGM Resorts International?

If you leave MGM Resorts International, you can choose to leave your 401(k) funds in the plan, roll them over to an IRA, or transfer them to a new employer's retirement plan.

Can MGM Resorts International employees take loans against their 401(k) savings?

Yes, MGM Resorts International allows employees to take loans against their 401(k) savings, subject to specific terms and conditions.

Are there penalties for early withdrawal from the MGM Resorts International 401(k) plan?

Yes, early withdrawals from the MGM Resorts International 401(k) plan may incur taxes and penalties unless specific exceptions apply.

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

Name of Pension Plan: MGM Resorts International does not have a traditional defined benefit pension plan; instead, it offers a 401(k) plan for retirement benefits. Years of Service and Age Qualification: Not applicable, as MGM Resorts International does not provide a defined benefit pension plan. Name of 401(k) Plan: MGM Resorts International 401(k) Plan Eligibility: Employees are generally eligible to participate in the 401(k) plan after completing 30 days of service. Contribution: Employees can make pre-tax or Roth contributions, and MGM Resorts International may provide matching contributions.

MGM Resorts International has been actively involved in restructuring efforts due to the economic challenges brought by the ongoing market volatility. The company announced a significant reduction in its workforce in early 2024, affecting various departments across its properties. This move is part of a broader strategy to streamline operations and reduce costs amid declining revenues and increased operational expenses. The layoffs impact not only the operational staff but also senior management, indicating a deep organizational restructuring. In addition to the layoffs, MGM Resorts has made adjustments to its company benefits and retirement plans, including changes to its 401(k) matching contributions and pension plans. The company has revised its retirement benefits to align with new economic realities, potentially affecting employees' long-term financial planning. These changes underscore the importance of staying updated on how shifts in company policies could influence personal financial strategies. Understanding these adjustments is crucial in the current economic and investment climate, as it impacts both individual retirement planning and overall job security. Being informed about such developments helps employees and investors make more strategic decisions in response to the evolving landscape of company benefits and economic conditions.

MGM Resorts International offers stock options and Restricted Stock Units (RSUs) to key executives and employees based on performance and tenure. The company uses the acronyms "SO" for Stock Options and "RSU" for Restricted Stock Units. Information about these benefits can be found in the annual reports and SEC filings.

Healthcare Coverage: MGM Resorts provides a range of health benefits including medical, dental, and vision insurance. They offer multiple plan options to suit various needs, with benefits such as preventive care, mental health services, and wellness programs. Wellness Programs: The company promotes wellness through programs such as fitness reimbursements, health screenings, and access to employee assistance programs (EAPs). Acronyms & Terms: Commonly used terms include PPO (Preferred Provider Organization), HSA (Health Savings Account), and EAP (Employee Assistance Program).

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For more information you can reach the plan administrator for MGM Resorts International at , ; or by calling them at .

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