Company Name | For plan years beginning in | Year | Month | First Segment | Second Segment | Third Segment | Plan Type |
ConocoPhillips | All | 2024 | March | 4.99% | 5.19% | 5.37% | |
ConocoPhillips | All | 2023 | March | 5% | 5.2% | 5.15% |
ConocoPhillips employees will see a reduction in their lump-sum if they retire in Q1 2023 as opposed to Q4 2022. Should you desire to take your pension as a lump sum, ConocoPhillips will use interest rates and your age to calculate your lump sum payment. When interest rates move up or down, your pension lump sum amount will move in an inverse relationship (except for Cash Balance Pension Lump Sum payouts).
On average, a 1% decline in interest rates results in roughly an 8%-12% increase to your pension lump sum (varies by age). Conversely, a 1% increase in interest rates results in roughly an 8%-12% drop in your lump sum pension value. Now that the May Corporate Bond Segment Rates are published, we encourage all employees that fall under one of these defined-benefit pension plans to re-run their pension projections to find out whether or not their lump-sum has decreased. We also encourage you to keep an eye on future rates as they seem to be trending upward. This is especially important if you are approaching retirement or already off payroll. You potentially may see a change in your pension lump sum.
Remember, you do not have to commence your pension benefit directly after you retire unless you are age 65 or older at retirement. It may be advisable to defer the election of your pension benefit well beyond your retirement date, although you cannot commence your pension benefit prior to your retirement date in most cases.
ConocoPhillips Retirement Plan
As it turns out, there are 8 different pension plans at ConocoPhillips, called Titles. Most employees fall under either the Phillips Retirement Income Plan (Title I), the Retirement Plan of Conoco (Title IV), The Burlington Resources Inc. Pension Plan (Title VI), or the ConocoPhillips Cash Balance Plan (Title II). If you don't fall under one of these plans or aren't sure which plan you fall under, please reach out to one of our COP-focused advisors for further guidance.
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Considering how sensitive Titles I, IV, and VI are to interest rates, The Retirement Group puts an immense amount of effort into tracking these rates and educating employees on how they affect pension lump sums in an effort to help individuals potentially increase their pension benefit when they leave the company.