Boeing Retirement Guide: Everything You Need to Know
In addition to being a titan of the aerospace industry, Boeing is also one of the largest employers in the U.S. Currently, Boeing employs more than 170,000 workers across 65 countries.
As an employee of the Boeing Company, you have a great opportunity to save for retirement. Boeing offers great retirement benefits that employees can use to prepare for their golden years.
Navigating your Boeing retirement options can seem daunting at first. The good news is that you don’t have to figure it out on your own. In this guide, we’re going to cover everything you need to know to make informed decisions. That way, you can plan for your future in peace.
Whether you’re a recent hire or a seasoned veteran at Boeing, this guide will set you on the right path.
Let’s get started!
Table of Contents:
Understanding Your Boeing Retirement Plan
Enrolling in the Boeing Retirement 401(k) Plan
Maximizing Your Boeing 401(k) Benefits
Social Security Benefits for Boeing Retirees
Medicare Benefits for Boeing Retirees
Other Boeing Retirement Benefits and Considerations
Planning for Early (or Late) Retirement as a Boeing Employee
Managing Your Boeing Retirement Income
How a Financial Advisor Can Help
What to Expect When Working with a Financial Planner
Key Takeaways
Boeing provides several ways to save and grow your wealth for retirement.
Understanding your retirement plan and investment choices is essential for maximizing your savings and preparing for retirement.
Boeing's generous matching contributions policy can effectively double your retirement savings.
Understanding Your Boeing Retirement Plan
The core of Boeing’s retirement benefits is the Boeing Voluntary Investment Plan (VIP). The VIP is a 401(k) plan that allows you to invest a portion of your income for retirement. When contributing to your VIP account, you can choose from several investment options, letting you customize your portfolio based on your personal needs and goals.
Boeing VIP: Traditional 401(k) vs. Roth 401(k)
The Boeing VIP allows employees to invest in either a traditional 401(k) or a Roth 401(k) account.
Traditional Pre-Tax 401(k): This plan allows you to make pre-tax contributions, which reduces your taxable income during your working years. Your savings will then be taxed when you withdraw money during retirement. Because you will likely be in a lower tax bracket after retiring, your withdrawals will be taxed at a reduced rate, letting you keep more of what you earned.
Roth 401(k): Unlike a traditional 401(k), contributions to a Roth 401(k) are made with after-tax dollars. When you make withdrawals later, your distributions will be tax-free, because they were already taxed when invested. This can be useful if you expect to be in a higher tax bracket after retirement.
VIP Matching Contributions
One of the primary benefits of the Boeing VIP is Boeing’s generous matching policy. When investing in your 401(k) account, the Boeing Company will match your contributions up to a cap of 10% of your salary. This means that if you contribute up to 10% of your salary every year, you could double your savings at no extra expense!
For example, let’s say you earn a salary of $100,000 and contribute 10% to your VIP plan. That would make your personal contribution $10,000. Boeing would then match that contribution dollar-for-dollar, raising your total 401(k) contribution to $20,000.
It really is that simple. Boeing is offering free money to help you save for retirement — no strings attached.
Pro Tip: The Boeing Match money is treated as pre-tax.
VIP Investment Options
The Boeing VIP offers a range of investment options so you can tailor your investment strategy as needed. Broadly speaking, the major options are:
Lifecycle funds: Also known as target-date funds, lifecycle funds automatically adjust your investments based on how long you have until retirement. As you approach retirement, your investments will become more conservative to help preserve your savings. This provides a hands-off investment strategy that manages risk over time.
Index funds: These funds are designed to copy the performance of a benchmark index, such as the S&P 500, by investing in the stocks or bonds that make up that index. Because index funds are automatically tied to an existing index, they require less oversight and have lower management fees.
Actively managed funds: Unlike lifecycle funds and index funds, actively managed funds are managed by professional fund managers who make investment decisions based on their own expertise. These funds may invest in a variety of assets and can adapt to market changes more rapidly. However, they typically come with higher fees due to the active management and research involved. They may also be riskier, depending on the investment choices your manager makes.
All three approaches have their pros and cons. Consult a qualified financial advisor to learn which option is best for you.
Managing Your Boeing VIP
The Boeing VIP is operated through a user-friendly online platform where you can:
Manage your contributions
Adjust your investments
Monitor your account performance
This platform also offers tools and resources to help plan for retirement, including calculators, educational materials, and personalized financial advice.
Boeing VIP Eligibility
To be eligible for the Boeing VIP, you must meet the following criteria:
You must be a non-union employee (or a union-represented employee who is participating in the VIP under current union agreements)
You must be paid directly through the Boeing payroll department.
You must not be on layoff or a leave of absence without pay at the time of enrollment.
For more details and the most up-to-date information, you can refer to the Boeing retirement benefits portal or contact Boeing's HR department for further guidance.
Boeing VIP and the Supplemental Savings Plan (SSP)
Because the Boeing VIP is a 401(k), it is subject to IRS limits on how much you can contribute to your account in a year.
In 2024, the 401(k) contribution limit for employees under the age of 50 is $23,000.
The 401(k) contribution limit for employees age 50 and older is $30,500.
Employees who want to invest beyond these limits can do so using the Boeing SSP.
Features of the Boeing SSP
The Boeing SSP is designed for high earners who want to invest more than the annual 401(k) contribution limits set by the IRS. This can significantly impact your retirement savings, especially if you are maximizing your contributions under the standard Boeing VIP.
Like the VIP, contributions to the SSP are made pre-tax, reducing your taxable income during your working years. Taxes on these contributions and any investment gains are deferred until withdrawal in retirement, when you may be taxed at a lower rate.
The SSP offers a wide range of investment options, allowing for strategic asset allocation based on your financial goals.
Funds stored in an SSP account would not be secured if Boeing went bankrupt. (This is the main downside when compared with the VIP.)
PRO TIP: To learn more about your VIP options, check out our handy guide: 25 Boeing Retirement FAQS.
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Enrolling in the Boeing Retirement 401(k) Plan
Most Boeing employees are eligible to participate in the retirement plans beginning on their date of hire, which means you can start contributing to your 401(k) from your very first paycheck. Boeing will also begin matching your contributions from day one!
Here’s how to enroll in the Boeing retirement plan:
1. Enroll in the Boeing Retirement Plan
Shortly after you begin employment, you'll receive information from Boeing’s human resources department about how to enroll in the retirement plan. This typically involves logging into a secure online portal where you can manage your retirement accounts.
2. Select Contribution Rates
During the enrollment process, you'll decide how much of your salary you want to contribute to the 401(k) plans. You can choose a percentage of your salary to be automatically deducted each pay period. (Remember, investing at least 10% of your salary will maximize your savings through the Boeing company match!)
3. Choose Your Investments
Next, select your investment options. Boeing offers a range of investment choices, including target date funds, index funds, and managed portfolios. It's advisable to consider speaking with an experienced financial advisor to optimize your investment strategy.
4. Keep an Eye on Annual Enrollment Windows
While you can generally change your contribution levels and investment choices at any time, there are specific enrollment windows each year that allow you to make changes to other plan features or enroll in additional benefits that Boeing might offer.
5. Review Your Investments Regularly
Your financial goals and personal circumstances can change. Regularly reviewing and adjusting your contributions and investments can ensure your retirement planning remains on track with your changing needs. We recommend taking a look at your investment portfolio at least once a year.
Maximizing Your Boeing 401(k) Benefits
Through strategic planning, you can make the most of your Boeing retirement benefits, helping you save more for a comfortable retirement. Here are some tips.
1. Take Full Advantage of Company Matching
Boeing matches 100% of the first 10% of your salary that you contribute to your Boeing 401(k). This means if you contribute up to 10% of your paycheck to your 401(k), Boeing will double your contribution.
It’s crucial to contribute at least enough to get the full Boeing match. Contributing less means missing out on free money that could grow substantially over time due to compound interest. This is essentially free money and a significant benefit of your employment package.
2. Max Out Your 401(k) Contribution Amount
If possible, consider contributing the maximum annual amount allowed by the IRS. In 2024, that limit is 23,000 for employees under 50, and $30,500 for employees 50 and older. If you can invest even more than that, consider using the Boeing SSP.
3. Increase Contributions with Every Raise
Whenever you receive a raise, consider increasing your retirement contributions. This can help you save more without impacting your current lifestyle since the increase is coming from new earnings.
4. Diversify Your Investments
Boeing offers a variety of investment options within its 401(k) plans, including:
Stocks
Bonds
Index funds
Lifecycle funds
Selecting the right mix of these assets based on your age, financial goals, and risk tolerance is crucial. If you have any questions, reach out to TrueWealth Financial Partners, and we’ll be happy to recommend the best options for you.
5. Consider Low-Fee Investments
Pay attention to the fees associated with different investment options. Lower fees can result in significant savings over time and can have a major impact on your investment growth. You will typically have reduced fees when using a passive investment system, such as a lifecycle fund or index fund.
6. Rebalance Your Investments Regularly
The market fluctuates, and so will the allocation of your investments. Life changes such as marriage, having children, or buying a house can also affect your financial goals. Review your retirement plan regularly to make any necessary adjustments to your contribution levels and investment choices. This will help ensure your investment portfolio remains aligned with your current needs and retirement timeline.
7. Make Catch-Up Contributions
For employees over the age of 50, Boeing’s 401(k) plans allow additional catch-up contributions. (This is why employees age 50 and over have an increased contribution limit of $30,500.) Catch-up contributions can be a powerful tool for increasing your retirement savings later in your career when you may have more financial flexibility.
Social Security and Medicare for Boeing Retirees
As you approach retirement, understanding how Social Security benefits and Medicare can be integrated into your Boeing retirement plan is crucial. These government programs provide foundational financial and healthcare support that can significantly impact your overall retirement strategy.
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Social Security Benefits for Boeing Retirees
The age at which you start claiming Social Security benefits will impact the amount you receive. While you can begin receiving benefits as early as age 62, waiting until full retirement age (currently between 66 or 67, depending on your birth year) or even until age 70 can substantially increase your monthly payments.
If you have a pension or other retirement savings, you may need to decide how to balance these with Social Security. Some retirees choose to delay Social Security to maximize their benefits while drawing from their 401(k) or pension in the earlier years of retirement.
You should also consider how your decisions might affect Social Security benefits for a spouse. By coordinating your strategies, you can optimize the total benefits received as a couple.
To learn more, reach out to the TrueWealth team!
PRO TIP: Deciding when to start claiming Social Security benefits affects your income strategy. Delaying benefits until age 70 can significantly increase your monthly payments, providing more financial security later in retirement.
Medicare Benefits for Boeing Retirees
As a Boeing employee, you are eligible to enroll in Medicare are the time you turn 65. There are specific enrollment periods, including the Initial Enrollment Period (IEP), which begins three months before your 65th birthday and extends for three months after. Signing up during this window is crucial to avoid late enrollment penalties.
If you have retiree health benefits from Boeing, these may work alongside Medicare. Typically, Medicare will be your primary insurance once you turn 65, and your Boeing coverage can fill gaps, such as covering some out-of-pocket costs. Understanding how these benefits coordinate is essential to avoid any gaps in coverage.
PRO TIP: Incorporate your expected Social Security benefits and potential Medicare expenses into your financial planning! Tools like the Social Security Administration's benefits calculator can help you forecast your benefits based on your earnings history.
Other Boeing Retirement Benefits and Considerations
Boeing offers a full suite of retirement benefits that go beyond just your VIP 401(k). Understanding these additional benefits will help you plan for retirement.
Retiree Health Benefits
Boeing provides various healthcare options, including medical, dental, and vision coverage. Boeing even offers health benefits for certain retirees, which can help manage healthcare costs later in life. Understanding the eligibility criteria and how these benefits change when you retire is important for planning your healthcare strategy.
Life Insurance
Boeing provides a basic life insurance policy at no cost to the employee. This policy is usually a multiple of your annual salary and helps provide financial security for your dependents. Employees also have the option to purchase supplemental life insurance at group rates, which can be a cost-effective way to increase coverage based on your personal needs.
To learn more, check out the Boeing health and insurance portal.
Employee Stock Purchase Plan (ESPP)
Boeing allows employees to purchase company stock at a discount through payroll deductions, which can be a lucrative way to invest due to the lower purchase price. This is known as the Employee Stock Purchase Plan (ESPP). Participating in the ESPP can complement your retirement savings and potentially increase your wealth over time.
Consult your TrueWealth financial advisor to learn if ESPP would be a smart move for your investment strategy.
HSAs and FSAs
Boeing offers eligible employees access to Health Savings Accounts (HSAs) and Flexible Savings Accounts (FSAs). These accounts allow you to set aside pre-tax dollars for eligible healthcare and dependent care expenses. Using FSAs can reduce your taxable income and help manage out-of-pocket costs for these necessary expenses.
Planning for Early (or Late) Retirement as a Boeing Employee
Retirement planning is never one-size-fits-all. This is especially true at Boeing, where employees may have wildly different career paths and retirement goals.
Whether you are considering retiring earlier than the traditional retirement age or extending your career, understanding the implications of these decisions is crucial for optimizing your retirement benefits. Here’s what you should know.
Early Retirement at Boeing
As a Boeing employee, early retirement may be an option for you if you meet certain criteria. However, you should always weigh your options when making this decision. Here are some factors to keep in mind:
Eligibility for benefits: If you are considering early retirement, it's important to first verify your eligibility for Boeing's retirement benefits, including the pension and health benefits. Some benefits may have minimum age or service requirements that must be met.
Financial concerns: Retiring early can significantly affect your financial stability. It means fewer years to contribute to retirement accounts and more years relying on your retirement savings. Calculating your financial needs and ensuring you have adequate savings to support your lifestyle without steady income is essential.
Healthcare considerations: One of the biggest challenges of early retirement is bridging the gap to Medicare eligibility at age 65. You’ll need to consider options for healthcare coverage, whether through COBRA, private insurance, or a spouse’s plan, to cover this interim period.
If early retirement is a goal, consider increasing your savings rate and taking full advantage of Boeing’s matching contributions and catch-up contributions if you’re over 50. You may want to adjust your investment strategy as well, to focus more on protecting your savings to help mitigate risk and provide stable returns.
Late Retirement at Boeing
Depending on your circumstances, late retirement may also be an option. There are certainly benefits to delaying retirement. For example:
More benefits: Working beyond the traditional retirement age allows you to maximize your Social Security benefits, as delaying your claim increases your benefits up to age 70. Additionally, extra working years provide more time to contribute to and grow your retirement savings.
Healthcare: Staying employed at Boeing may allow you to maintain your employer-sponsored health benefits, reducing your reliance on Medicare and potentially providing more comprehensive coverage.
If you plan to retire late, you might choose to maintain a more aggressive investment portfolio, as your time horizon for needing to draw down your savings extends.
When considering early or late retirement, always discuss the options with your TrueWealth financial advisor. This is never a decision to make lightly!
PRO TIP: Boeing may offer options for phased retirement, allowing you to gradually reduce your working hours while beginning to draw retirement benefits. This can provide a smoother transition to full retirement and help you adjust to changes in income and lifestyle.
Managing Your Boeing Retirement Income
Managing your retirement income is crucial for peace of mind in your golden years. It’s always wise to be aware of your options.
Tax-Efficient Withdrawal Strategies
To minimize taxes and maximize income longevity, consider the sequence of your withdrawals. For example, it’s often smart to draw from taxable accounts first, then tax-deferred accounts, leaving tax-free accounts like Roth IRAs for last.
Plan your withdrawals to stay within lower tax brackets whenever possible. Spreading out large withdrawals over multiple years can help reduce your tax liability.
Lump Sum vs. Monthly Pension Payments
When withdrawing from your Boeing pension account, you can choose between a lump sum withdrawal or monthly payments.
A lump sum payment provides you with immediate access to all your pension funds, offering flexibility to invest or manage the money as you see fit. This can be useful if you have other stable income sources or significant investment expertise.
Monthly pension payments provide a steady, guaranteed income month-to-month. This can make budgeting easier and reduce the risk of outliving your retirement savings. This option is particularly advantageous for those who prefer financial stability and predictability over the long term.
Consult with a financial advisor to learn which option aligns best with your overall retirement strategy and financial goals.
Required Minimum Distributions (RMDs)
Starting at age 72, the IRS requires you to begin taking minimum withdrawals from your tax-deferred retirement accounts every year. Knowing the amounts and the timing ahead of time can help you plan your yearly finances.
PRO TIP: If you don't need the income from RMDs for living expenses, consider using the funds for charitable donations, which can provide tax benefits.
Coping with Inflation
Inflation can erode your purchasing power over time. When making investments, prioritize funds that have the potential to increase in value or generate higher yields to help protect against inflation.
Planning for Longevity
One of the biggest financial risks in retirement is outliving your savings. Ensuring that your income strategy supports a potentially long retirement is essential. Consider financial products like annuities that provide guaranteed income for life as a way to hedge against this “longevity risk.”
Preparing for Unexpected Challenges in Retirement
Retirement planning is not just about mapping out your ideal future; it's also about preparing for the unexpected. Challenges such as health emergencies, economic downturns, and personal life changes can disrupt even the most well-thought-out plans. Boeing employees can take several steps to safeguard their retirement against these potential hurdles.
Health Emergencies
As healthcare needs tend to increase with age, having a robust plan to cover unexpected medical expenses is crucial. Consider enhancing your Medicare with supplemental policies that cover additional costs and services not included in basic Medicare.
Long-term care insurance may also be valuable. Given the high cost of long-term care, purchasing long-term care insurance can protect your savings if you or your spouse need extended medical or personal care. Evaluate different policies to find one that suits your needs and budget.
Economic Downturns
The stock market can be unpredictable. Maintain a diversified investment portfolio that can withstand market volatility. Include a mix of stocks, bonds, and other assets to mitigate risks associated with economic downturns.
A flexible withdrawal strategy for your retirement income can help too. During market downturns, if possible, reduce your withdrawals or draw from more stable investments to preserve your portfolio's longevity.
Personal Life Changes
We never know what challenges life can throw our way. Establishing an emergency fund with several months’ worth of living expenses can provide a financial buffer that allows you to manage unforeseen costs without tapping into your retirement savings.
Estate Planning
Regular updates to your estate plan, including wills, trusts, and power of attorney, can ensure that your assets are distributed according to your wishes, even if personal circumstances change.
Family Considerations
If you have dependents, consider their potential financial needs in your retirement planning. This might include:
Supporting a child with special needs
Contributing to grandchildren’s education
Assisting aging parents
Regular discussions with family members about your retirement plans, health directives, and estate plans can prevent misunderstandings and ensure everyone is prepared for potential changes.
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How a Financial Advisor Can Help
Retirement planning can get complicated fast. Working with a financial advisor can provide personalized guidance, helping you make informed decisions and optimize your retirement income. For example, your financial advisor can give you…
Expertise in Boeing Benefits
A financial advisor who is familiar with Boeing’s specific retirement plans and benefits can offer tailored advice that an average advisor might not provide. They can help you understand intricate details of your benefits, including the VIP, pension plans, and supplemental plans.
Comprehensive Financial Review
Financial advisors do more than just help manage investments. They can conduct a thorough review of your entire financial situation — savings, debts, investments, insurance, estate plans — and identify areas for improvement or potential risks.
Long-Term Strategy Development
A financial advisor can help you develop a strategy that encompasses all phases of retirement planning, from accumulation and preservation to distribution. They can adjust this plan as your needs and market conditions change over time.
What to Expect When Working with a Financial Planner
1. Initial Consultation
This meeting is often free and allows you to discuss your goals and concerns and see if the advisor is a good fit for your needs.
2. Getting to Know You
If you decide to proceed, the next step involves detailed information gathering about your finances and discussions about your financial goals.
3. Making a Plan
The planner will then develop a comprehensive plan tailored to your objectives. This plan should be reviewed with you in detail, allowing you to ask questions and make adjustments as necessary.
4. Ongoing Review
Financial planning is not a one-time event. Regular meetings to review your plan and make adjustments based on life changes, economic conditions, or changes in your goals are essential.
Give Yourself the Gift of a Comfortable Retirement
Retirement is a gift waiting at the end of all your hard work. With Boeing’s robust retirement plan, you have a solid foundation to build a secure and enjoyable retirement. However, you’ll still want to optimize your retirement planning. And the sooner you start, the better!
To get personalized help with your retirement plan, schedule a consultation with your TrueWealth retirement advisor today. We’ll be happy to answer all your questions! Then, we can get started on creating the perfect Boeing retirement plan for you.
Remember, the decisions you make today will have a lasting impact on your future. Let us help you make your golden years truly golden!
We look forward to hearing from you.
Boeing Retirement FAQs
When can I start contributing to my Boeing 401(k) plan?
You can start contributing to your Boeing 401(k), also known as the Voluntary Investment Plan (VIP), as soon as you are hired. Check your specific employment details as Boeing may have waiting periods or eligibility criteria that apply.
How much should I contribute to my 401(k) to maximize my Boeing match?
Boeing matches 100% of your contributions for the first 10% of your salary. To take full advantage of this match, you should aim to contribute at least 10% of your pre-tax income.
What are the differences between the traditional 401(k) and Roth 401(k) options in the Boeing VIP?
The traditional 401(k) allows you to make pre-tax contributions, which lowers your taxable income now, but you’ll pay taxes on withdrawals during retirement. The Roth 401(k) is funded with after-tax dollars, meaning you pay taxes now, but withdrawals in retirement are tax-free.
What happens to my retirement plans if I leave Boeing before retirement?
If you leave Boeing before retirement, you can choose to:
Leave your 401(k) funds in Boeing’s plan
Roll them over into a new employer’s plan
Roll them over into an IRA
Withdraw the funds early (which may incur penalties and taxes).
Pension benefits may also vary; some may be vested and remain with you, while others might be lost if you haven’t met the vesting requirements.
Can I take out a loan from my Boeing 401(k) plan?
Boeing's 401(k) plan does offer loan options. This allows you to borrow from your retirement savings for specific purposes, such as purchasing a home or covering unexpected expenses. However, taking a loan from your 401(k) can have implications on your retirement savings, so it's essential to consider the pros and cons carefully.
Are there any penalties for early withdrawals from my Boeing retirement accounts?
Making early withdrawals from your Boeing retirement account 401(k) plans can result in penalties and additional taxes. Always consider the long-term impact on your retirement savings before making early withdrawals.
How can I get help with my Boeing retirement planning?
For personalized assistance with your Boeing retirement planning, contact TrueWealth Financial Partners! Our experienced advisors specialize in Boeing retirement benefits and can provide tailored guidance to help you achieve your financial goals. Schedule a consultation today to start planning for your future!