A Retirement Income Roadmap for Women For ExxonMobil Employees

Recent studies have shown that women tend to face unique financial challenges during retirement, including longer life expectancies, lower lifetime earnings, and increased healthcare costs. According to a report by the National Institute on Retirement Security published in March 2021, women are 80% more likely than men to be impoverished at age 65 and older. To address these challenges, experts recommend that women take steps to create a retirement income roadmap that includes maximizing Social Security benefits, saving aggressively, and investing in a diversified portfolio. Additionally, women may want to consider purchasing long-term care insurance to protect against unexpected healthcare costs in retirement.

It's important for you to be involved in the retirement income planning process even

if you're married. While you may plan to be married forever, many women

end up single at some point in their lives due to divorce or death of a spouse.

More women than ever before are employed and responsible for their own retirement planning. What does it mean to you to retire from ExxonMobil? Do you yearn to travel? Pursuing a pastime? Volunteering or establishing a new profession or business? Spending additional time with your grandchildren? Regardless of your objective, you will need a retirement income plan that is designed to support your desired retirement lifestyle and minimize the risk of outliving your savings.

When Will You Retire From ExxonMobil?

Establishing a target age is essential, as the age at which you retire from ExxonMobil will have a significant impact on the amount you must save. For instance, if you retire early from ExxonMobil at age 55 instead of waiting until age 67, you will have 12 fewer years to accumulate funds and more years to live off your retirement savings. Additionally, we'd like ExxonMobil customers to consider:

The longer you delay your ExxonMobil retirement, the longer you have to accumulate tax-deferred funds in your IRAs and ExxonMobil-sponsored plans such as 401(k)s, or accrue benefits in a traditional pension plan if you're fortunate enough to be covered.
Medicare coverage typically begins at age 65. Does ExxonMobil provide post-retirement medical benefits? Are you eligible for coverage if you leave ExxonMobil before your retirement age? Do you have health insurance through the employer of your spouse? If not, you may need to consider COBRA or a private individual policy, which may be costly.
At age 62, you can begin obtaining your Social Security retirement benefit. However, your benefit may be reduced by 25% to 30% compared to if you had waited until complete retirement age. If you delay your ExxonMobil retirement past the age of complete retirement, you may be able to increase your Social Security retirement benefit.
If you work part-time during retirement, you will earn money and rely less on your retirement savings, allowing more of your savings to grow for the future (and you may also have access to affordable health care).
Consider staggering your retirements if you and your spouse are both employed and approach retirement age and are married ExxonMobil customers. If one spouse earns substantially more than the other, it is typically prudent for the higher-earning spouse to continue working in order to maximize current income and ease the transition into retirement.

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How Long Will Retirement Last When You Leave ExxonMobil?

We all aspire to live to a ripe old age, but a longer life means you'll have to fund more retirement years. As women tend to live longer than males, the problem is especially acute for them. To protect against the possibility of outliving your investments, you must calculate your life expectancy. You can estimate your life expectancy using government statistics, life insurance tables, or life expectancy calculators. These estimates are based on your age, gender, race, health, lifestyle, and profession, as well as your familial history. However, ExxonMobil customers must keep in mind that these are only estimates. It's impossible to predict how long you'll actually live, but given rising life expectancies, it's probably safest to presume you'll outlive your expectations.

Project Your Retirement Expenses

Once you've determined when your ExxonMobil retirement will likely begin, how long it may last, and the type of retirement lifestyle you desire, it's time to estimate how much money you'll need. Underestimating the amount you'll need to save by the time you retire from ExxonMobil is one of the biggest retirement planning errors you can make. It is commonly stated that you will need 70 to 80 percent of your pre-retirement income in retirement. However, the issue with this strategy is that it does not account for your unique circumstances.

Consider whether your current expenses will remain the same, increase, decrease, or even disappear by the time you retire from ExxonMobil. While some expenses, such as a mortgage or commuting costs, may diminish as you age, others, such as health care and insurance, may increase. If travel or hobbies will be a part of your retirement, be sure to include the associated expenditures. Also, remember to consider the prospective impact of inflation and taxes.

Identify Your Sources of Income

The next stage, after determining your retirement income requirements, is to evaluate your (or you and your spouse's) ability to meet those needs. In other terms, what retirement income sources will you have access to? ExxonMobil may provide a traditional pension plan with periodic benefits. In addition, it is likely that Social Security will contribute to your retirement income. Other sources of retirement income may include IRAs, annuities, and other investments.

The quantity of income you receive from these sources depends on the amount you invest, the rate of return on your investments, and other variables. Lastly, if you intend to work during your ExxonMobil retirement, your earnings will be an additional source of income. When you compare your projected expenses to your expected sources of retirement income, you may discover that you will not have sufficient funds to meet your needs and objectives. This difference, or 'gap,' must be closed as part of your retirement income strategy. In general, if you face a shortfall, you have five options: save more now, delay your ExxonMobil retirement or work during retirement, attempt to increase the returns on your retirement assets, find new sources of retirement income, or reduce your retirement spending.

Transitioning Into Retirement

Even after that special day arrives, you will continue to have responsibilities. So that your retirement savings last as long as you need them to, you will need to carefully manage your assets.

We recommend that our ExxonMobil clients regularly evaluate their portfolios. According to conventional wisdom, retirees should prioritize the security of their principal above all else. As a result, as they approach retirement, some individuals transfer their portfolio towards fixed-income investments, such as bonds and money market accounts. The issue with this strategy is that you will effectively lose purchasing power if your investment returns do not maintain pace with inflation. While it is generally prudent for your portfolio to become increasingly conservative as you age, it may be prudent to maintain at least a portion in growth investments.

Spend carefully. You should avoid spending too much too quickly. This can be a significant temptation, especially in the early stages of retirement. A decent rule of thumb is to withdraw no more than 4 to 6 percent of your portfolio annually. (The appropriate percentage will depend on a number of factors, including the duration of your payout period and the asset allocation of your portfolio.) Keep in mind that if you deplete your principal too rapidly, you may not be able to earn enough on the remaining principal to sustain you in later years.

Understand your distribution options for your retirement plan. The majority of pension programs provide benefits as an annuity. The majority of our ExxonMobil clients who are married must choose between a larger retirement benefit that terminates upon the death of their spouse and a smaller retirement benefit that continues in whole or in part for the surviving spouse. A financial expert can assist you with this difficult but crucial decision.

Consider which assets to utilize initially. In theory, the answer for many retirees is straightforward: withdraw funds from taxable accounts first, then tax-deferred accounts, and finally tax-free accounts. By using tax-favored accounts last and deferring taxes for as long as possible, you will keep more of your retirement funds working for you. However, we would like to remind ExxonMobil customers that this approach is not suitable for everyone. And remember to account for mandated distributions. You are required to begin drawing minimum distributions from ExxonMobil retirement plans and traditional IRAs at age 72, regardless of whether or not you require them. Plan to use these funds first during retirement.

Consider an immediate annuity purchase. Annuities offer a unique benefit: a guaranteed income stream for the remainder of your life or for the lifetimes of you and your spouse combined (although this guarantee is contingent on the claims-paying ability and financial strength of the issuer). In the context of retirement income planning, the apparent benefit is that an annuity allows you to lock in a predictable, risk-free annual income stream that you cannot outlive.** Sadly, there is no one-size-fits-all approach to retirement income planning. A financial professional can evaluate your situation, assist you in evaluating your options, and help you develop an appropriate plan.

Conclusion

A Retirement Income Roadmap for Women is like a GPS for a road trip. Just as a GPS helps drivers navigate through unfamiliar terrain to reach their destination, a Retirement Income Roadmap guides women towards a financially secure retirement. By providing a clear path with step-by-step directions, it helps women avoid financial roadblocks and detours that can derail their retirement plans. Just as drivers need to stay alert and adjust their route when necessary, women also need to regularly review and update their retirement plan to ensure they stay on course and reach their financial goals.

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…).

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

ExxonMobil offers a traditional defined benefit pension plan that provides a monthly retirement benefit. Employees can choose between a lump-sum payment or a monthly annuity. The plan calculates benefits based on final average pay and years of service.

Layoffs and Restructuring: ExxonMobil announced plans to lay off approximately 1,900 employees in 2024 as part of its ongoing restructuring efforts. These layoffs are aimed at improving cost efficiency and adapting to market changes amidst fluctuating oil prices (Sources: MarketScreener, Nasdaq). Facility Closures: The company is closing its Clinton, New Jersey facility, leading to the loss of hundreds of jobs. Most affected employees are being offered roles at the Houston headquarters (Source: ROI-NJ). Operational Strategy: The restructuring is part of ExxonMobil's broader strategy to consolidate its North American research and technology operations in Houston, which is expected to enhance research capabilities and drive long-term growth (Source: ROI-NJ).

ExxonMobil provides RSUs that vest over time, offering employees shares upon vesting. They also grant stock options, allowing employees to buy shares at a set price.

ExxonMobil offers a comprehensive benefits package that addresses a wide range of employee needs. For 2023, the company continued to provide robust health insurance options, including various medical, dental, and vision plans. These plans offer extensive coverage for preventive care, major dental services, and comprehensive vision care, including allowances for lenses and frames or contact lenses. Notably, the medical plans also cover telemedicine services, second opinion services, and enhanced fertility benefits. This reflects ExxonMobil's commitment to ensuring its employees have access to high-quality healthcare options that cater to their specific needs. In 2024, ExxonMobil has introduced several enhancements to its benefits offerings. The Employee Health Advisory Program provides professional counseling services for mental health issues, including anxiety, depression, and family conflicts, in a confidential environment. Additionally, the company continues to support employees through a pre-tax spending plan, allowing them to make tax-free contributions to cover eligible health care and dependent care expenses. These benefits are particularly relevant in today's economic and political climate, where managing healthcare costs and ensuring mental well-being are critical. ExxonMobil's focus on comprehensive and flexible healthcare benefits underscores its commitment to supporting the overall well-being of its employees.