There are just a couple of things almost all Intuitive Surgical retirees need when they hit retirement: predictable income and protection against a cluster of risks, which include longevity risk, performance risk and sequence-of-returns risk.
In the past we have seen retiring Intuitive Surgical employees utilize the “4% rule,” where retirees take annual withdrawals start at 4% of the entire portfolio and increase with inflation. They then keep the remainder of the portfolio with at least 50% invested in equities. Based on historical data, this would give a Intuitive Surgical retiree about 30 years of retirement income.
As the economy constantly changes, a number of factors may force prospective Intuitive Surgical retirees to revisit the 4% rule. It may be worth considering annuities as an alternative.
As life expectancies increase, Intuitive Surgical retirees need to prepare for expenses over a longer time frame. In the past we would plan for a 15 to 20 year retirement, but now we need to prepare for a 30 to 35 year retirement. What is available to assist meeting the 35-year time frame?
The annuity strategy can assist with a few of the pitfalls we see in the 4% rule. For example:
If you need $50,000 per year in retirement and need that for 30 years, you may need $1.2 million in fixed income at a 3% interest rate. BUT if you look to fund $50,000 for 30 years, you can cover that expense with $800,000 by choosing the annuity option.
The other pitfall with the 4% rule is that it may not reflect a client’s risk tolerance. When you are accumulating assets, you can afford more volatility and can take on more risk than when in the retirement and withdrawal phase after leaving Intuitive Surgical.
Also, should we see a drop in the market, you would be able to reduce your income using the 4% rule, which you cannot do if you choose an annuity option.
Articles you may find interesting:
- Corporate Employees: 8 Factors When Choosing a Mutual Fund
- Use of Escrow Accounts: Divorce
- Medicare Open Enrollment for Corporate Employees: Cost Changes in 2024!
- Stages of Retirement for Corporate Employees
- 7 Things to Consider Before Leaving Your Company
- How Are Workers Impacted by Inflation & Rising Interest Rates?
- Lump-Sum vs Annuity and Rising Interest Rates
- Internal Revenue Code Section 409A (Governing Nonqualified Deferred Compensation Plans)
- Corporate Employees: Do NOT Believe These 6 Retirement Myths!
- 401K, Social Security, Pension – How to Maximize Your Options
- Have You Looked at Your 401(k) Plan Recently?
- 11 Questions You Should Ask Yourself When Planning for Retirement
- Worst Month of Layoffs In Over a Year!
- Corporate Employees: 8 Factors When Choosing a Mutual Fund
- Use of Escrow Accounts: Divorce
- Medicare Open Enrollment for Corporate Employees: Cost Changes in 2024!
- Stages of Retirement for Corporate Employees
- 7 Things to Consider Before Leaving Your Company
- How Are Workers Impacted by Inflation & Rising Interest Rates?
- Lump-Sum vs Annuity and Rising Interest Rates
- Internal Revenue Code Section 409A (Governing Nonqualified Deferred Compensation Plans)
- Corporate Employees: Do NOT Believe These 6 Retirement Myths!
- 401K, Social Security, Pension – How to Maximize Your Options
- Have You Looked at Your 401(k) Plan Recently?
- 11 Questions You Should Ask Yourself When Planning for Retirement
- Worst Month of Layoffs In Over a Year!
What type of retirement savings plan does Intuitive Surgical offer to its employees?
Intuitive Surgical offers a 401(k) retirement savings plan to help employees save for their future.
Is there a company match for contributions to the 401(k) plan at Intuitive Surgical?
Yes, Intuitive Surgical provides a company match for employee contributions to the 401(k) plan, subject to specific terms and conditions.
How can I enroll in the 401(k) plan at Intuitive Surgical?
Employees can enroll in the 401(k) plan at Intuitive Surgical by completing the enrollment process through the company’s benefits portal or contacting HR for assistance.
What is the eligibility requirement for participating in Intuitive Surgical's 401(k) plan?
To participate in Intuitive Surgical's 401(k) plan, employees typically need to meet certain eligibility requirements, such as being a full-time employee and completing a specified period of service.
Can I change my contribution amount to the 401(k) plan at Intuitive Surgical?
Yes, employees at Intuitive Surgical can change their contribution amounts to the 401(k) plan at any time, subject to the plan's guidelines.
What investment options are available in Intuitive Surgical's 401(k) plan?
Intuitive Surgical's 401(k) plan offers a variety of investment options, including mutual funds, target-date funds, and other investment vehicles to suit different risk tolerances.
When can I access my 401(k) funds after leaving Intuitive Surgical?
After leaving Intuitive Surgical, employees can access their 401(k) funds according to the plan's distribution rules, which may include options like rollovers or cash withdrawals.
Does Intuitive Surgical offer financial advice for 401(k) participants?
Yes, Intuitive Surgical may provide access to financial advisors or resources to help employees make informed decisions about their 401(k) investments.
Are there any fees associated with Intuitive Surgical's 401(k) plan?
Yes, there may be fees associated with Intuitive Surgical's 401(k) plan, which can include administrative fees and investment-related fees, as outlined in the plan documents.
How often can I review my 401(k) account at Intuitive Surgical?
Employees can review their 401(k) account at Intuitive Surgical as often as they like, typically through the online benefits portal.
-2.png)
.webp)