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I worked at UPS for 6 years and I recentley quit last September. I get a benefits package in the mail today 1 year later stating that I can have the following 2 Options.
Option 1. - I can get a lump sum payment of $4249 but the government will tax 20% of that so the total I believe actually is $3600.
Option 2. - I can wait until im 65 years old and I will get a $320 a month check for the rest of my life.
I am 26 years old, My father in law told me to take it because MCI took all of his and he said you never know what could happen 40 years from now. which in 40 years I will be eligble for the $320 a month.
Ive had people tell me to leave it alone and wait until im 65 years old. Im asking all you guys...? I am torn on this and dont know what to do. any info/advice would help.
Where did he 20% tax come from? I thought its a IRS 10% penalty only if under 59 1/2 plus regular income taxes at what ever rate you are when you file? They may be required to withold 20%, but the actual amount will be the 10% penalty plus whatever regular taxes you owe on the money.
The days of a company raiding a pension plan and running off with your money is gone. They can drop the balance so low they really can;t pay the projected amounts or they can abandon it, But in both cases the gov't pension benefit trust will take it over and pay whatever they can to those entitled to payment.
Where did he 20% tax come from? I thought its a IRS 10% penalty only if under 59 1/2 plus regular income taxes at what ever rate you are when you file? They may be required to withold 20%, but the actual amount will be the 10% penalty plus whatever regular taxes you owe on the money.
The days of a company raiding a pension plan and running off with your money is gone. They can drop the balance so low they really can;t pay the projected amounts or they can abandon it, But in both cases the gov't pension benefit trust will take it over and pay whatever they can to those entitled to payment.
I think he is saying there will be 20% withheld. This has nothing to do with his tax liability. However, it will not be enough because he will be subject to the 10% penalty along with his regular income tax.
this is not a 401k, actually idk what this is lol. they never deducted any out of my check the past 6 years Its just a benefit of some sort. It is not a 401K. would you guys take the money or should I sit and wait for 40 years to get here?
this is not a 401k, actually idk what this is lol. they never deducted any out of my check the past 6 years Its just a benefit of some sort. It is not a 401K. would you guys take the money or should I sit and wait for 40 years to get here?
I doubt that they are just "giving" you money. There are always deductions being taken from paychecks. I didn't even know I had a pension until I received a yearly statement from the investment company!
Anyway, you really should find out what it is before you take any action!
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