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| Company Name | For plan years beginning in | Year | Month | First Segment | Second Segment | Third Segment | Plan Type |
| ExxonMobil | All | 2024 | May | 5.18% | 5.41% | 5.62% | |
| ExxonMobil | All | 2023 | May | 4.91% | 5.15% | 5.34% |
ExxonMobil lump-sum payments will drop again in the first quarter of 2023 as September's rate change is the biggest increase ever. Your pension is calculated based on your last date of employment and benefits start date. The benefit calculation is a defined benefit based on your years of service and final average pay. These, along with a social security offset are used to determine your single life annuity. All other forms of pension payments are based on this figure.This article is pertinent to all age groups, however those entering their (age range) will find the information particularly important This information is pertinent to all age groups, however those entering their retirement years will find the information particularly important.
Another consideration is If you are at least 63 years old with at least 23 years of ExxonMobil service by December 31, 2020, you are considered grandfathered into the old pension calculation method. The old pension calculation method uses the 30-year Treasury bond interest rates. ExxonMobil will take the average Treasury rate for the fourth, fifth, and sixth months prior to the quarter you elect to “commence” your pension benefit, also known as your benefit commencement date (BCD). Then ExxonMobil multiplies this rate by 95% and rounds to the nearest quarter percent. For example, if you retire in December and want to receive your pension in January, ExxonMobil will take the average Treasury rate for July, August, and September multiplied by .95, and then round it to the nearest quarter percent. The grandfathered rate for the third quarter is now set at 3.00%, which is the same as Q4 2022.
Non‐Grandfathered Employees
If you are not at least 63 years old with at least 23 years of ExxonMobil service by December 31st, 2020, then you are not grandfathered into the old pension calculation method. In calculating your lump sum, ExxonMobil will use the average of the short, intermediate, and long-term corporate bond segment rates for the fourth and fifth months prior to the quarter you plan to commence your pension benefit. For instance, if you plan to retire in December and start your pension in January of 2023, ExxonMobil will use the average corporate bond interest rates for the months of August and September of 2022 to calculate your pension lump sum (the average of the fourth and fifth month prior to the quarter you plan to start your pension).
Rates increased significantly for non-grandfathered employees from Q4 2022 to Q1 2023. This change may be enough for some employees to leave the company earlier than they had previously anticipated.
For lump-sum conversions, the pension annuity is discounted to a present value using the first segment rate for the first five years of expected payments, the second segment rate for the next 15 years of expected payments, and the third segment rate for all years of expected payments over 20. Because the annuity is discounted based on mortality as well as interest rates, the present value of each monthly payment reduces as the probability of living to receive each payment reduces. The older you are when you commence your pension benefit, the fewer the number of years that will be valued using the third segment rate (20+ years) and, conversely, the younger you are, the greater the number of years that will be valued using the third segment rate.
This methodology essentially means that there will be a unique quarterly interest rate (lump-sum conversion factor) for each year and month of birth.
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How Do Rate Changes Affect Your ExxonMobil Pension?
Pension pricing is based on interest calculations, therefore making a slight adjustment in your retirement date may have a significant financial impact on your pension due to changing rates each month.
Everything else held equal, a lower interest rate will produce a higher lump sum. The exact changes depend on your specific age, but on average a 1% change in rates can equate to an 8% to 12% change in lump sums. So, on average, a 1% change could increase or decrease your pension lump sum by roughly 10%.
The changes from the fourth quarter of 2022 to the first quarter of 2023 may account for about a 2.4% decrease in lump sums, depending on whether or not you are considered grandfathered. The second segment rate, which is the most impactful, has increased by 2.4%. With no sign of this trend coming to an end soon, it is very important we run or update your cash flow analysis so you know all your claiming options.
You do not have to commence your pension as soon as you retire. You have the option to defer it. That may be beneficial if rates are dropping and/or you are under 60 years old. If you take your pension prior to age 60 there are age penalties and you will not receive 100% of your pension benefit.
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…).
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