Your ConocoPhillips 401(k) Statement Could Have an Unwelcome Surprise

ConocoPhillips 401(k) statements will now contain an estimate of the amount of income you will receive from your current amount in retirement. Savers typically receive these statements each quarter via mail or digitally. The new estimate will be referred to as a “lifetime income illustration”, and will show how much income you would receive each month from the rest of your life after age 67, if you purchased an annuity with your 401(k). While many Americans think about their retirement savings as one big pot of money, policymakers are actively trying to get retirees to think about their savings as a monthly check.

Strictly thinking in terms of how much total money a person has saved for retirement can be misleading in terms of what their lifestyle will be like moving forward. For example, a saver may have amassed $500,000 for their next egg. This may sound like a lot of money, however when it is broken down into monthly payments this person would have about $2,000 - $2,400 per month to spend. For some people $2,000 per month may be more than enough, for others it could mean making significant cut backs from your current lifestyle.