25 Boeing VIP (Voluntary Investment Plan) FAQs
The primary retirement plan at Boeing is the VIP. This 401(k) program is designed to help Boeing employees invest and grow their wealth for retirement. To help you optimize your retirement planning, here are the answers to all your questions about the Boeing VIP!
1. What is the Boeing VIP?
The Boeing Voluntary Investment Plan (VIP) is a 401(k) plan provided for all Boeing employees. Using this plan, you can invest a portion of your salary into a retirement account. The money will then grow tax-free until you are ready to make withdrawals after retiring.
2. Who can invest in the Boeing VIP?
All Boeing employees are eligible to invest in the VIP after being hired. This includes full-time and part-time employees who meet the company's eligibility requirements. There is no waiting period. You can start saving on day one!
3. How much can I contribute to my Boeing VIP?
Boeing employees can contribute up to the IRS annual limit for 401(k) plans. In 2024, the annual IRS limits are:
$23,000 for employees under 50
$30,500 for employees 50 or over (thought catch-up contributions)
These numbers can change every year, so be sure to stay up-to-date on the current limit for your VIP account.
4. Will Boeing match my VIP contributions?
Yes, Boeing has a generous matching policy for VIP contributions. The company will match every contribution dollar-for-dollar up to 10% of your salary. For example, if your salary is $100,000 and you invest $10,000 in your VIP, Boeing will contribute an additional $10,000 with no strings attached. That way, you can double your savings for free!
5. Are VIP contributions pre-tax or after-tax?
They can be either. When investing in your Boeing VIP, you will have the option to invest using pre-tax, after-tax, or Roth funds. Pre-tax contributions are most common, however.
6. What types of investments are available in the Boeing VIP?
The Boeing VIP offers a variety of investment options, including:
Lifecycle funds
Index funds
Actively managed funds
You can customize your investment strategy based on your personal goals and tolerance for risk. Better yet, consider working with a financial advisor who can help you make the most of your investments!
7. Can I invest more than the IRS 401(k) limit in my VIP account?
Not in your standard VIP 401(k) account, no. However, Boeing does provide some additional options to save and invest more for retirement. The two main contenders are:
Boeing Supplemental Savings Plan (SSP)
Boeing Mega Backdoor Roth
Using these plans, you can boost your savings for a better retirement.
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8. What are the tax benefits of participating in the Boeing VIP?
By contributing to the Boeing VIP, you can reduce your taxable income and let your money grow tax-free. And because most contributions are pre-tax, you will not be taxed when making investments. Your funds will only be taxed when you withdraw them during retirement. By then, you may be in a lower tax bracket, allowing you to keep even more of your savings.
9. When can I access my Boeing VIP funds?
In most cases, you can access your funds without penalty upon reaching the age of 59½ or retiring from Boeing. There are also times when you can make penalty-free early withdrawals, such as during severe financial hardship or when facing medical expenses.
10. How do I manage my Boeing VIP account?
You can manage your account online through the Boeing NetBenefits portal on the Fidelity website. (Fidelity manages the VIP 401(k) program for Boeing.) Using that portal, you can change your contribution rate, keep track of your investments, and view your account balance.
11. What happens to my VIP funds if I leave Boeing?
If you leave Boeing, you have several options:
Leave the funds in the plan: If your account balance exceeds a certain minimum, you can leave your funds in the plan to continue benefiting from its investment options.
Roll over to an IRA or another employer's plan: You can roll over your VIP funds to an Individual Retirement Account (IRA) or another employer’s 401(k) plan without incurring immediate taxes or penalties.
Withdraw the funds: Cashing out your account is also an option, but it may lead to taxes and early withdrawal penalties, depending on your age and circumstances.
Each option has its pros and cons. To learn which is best for you, speak to a qualified financial advisor.
12. What happens to my Boeing VIP if I'm fired or laid off?
If you are fired or laid off from Boeing, you will have the same options as when you leave voluntarily. Namely, you can:
Leave the funds in the plan (as long as you meet the minimum balance requirement)
Roll over the funds to an IRA or another employer's plan
Withdraw the funds
13. Can I contribute to both a traditional 401(k) and a Roth within the Boeing VIP?
Yes, Boeing lets employees contribute to both traditional and Roth accounts within the VIP. This allows you to take advantage of both pre-tax savings and tax-free withdrawals, depending on which is best for you.
14. Does the Boeing VIP have fees?
The fees for using the Boeing VIP will vary based on your investment choices. For example, passing investments like a lifecycle fund will have lower fees, while an actively managed fund will cost extra to pay for the fund manager(s).
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15. How often should I review my VIP investments?
We recommend reviewing your investments at least once a year. You should also review them after any marriage life events, such as a marriage or the birth of a child. This helps keep your investment strategy aligned with your changing financial needs and goals.
16. Can I use my VIP funds to invest in Boeing stock?
Yes, Boeing lets you invest your VIP contributions in Boeing stock. However, be careful not to focus all your investments on any one company or industry. It’s important to maintain a diversified portfolio.
17. Can I take out a long using my Boeing VIP funds?
Yes, the Boeing VIP lets you take out loans against your 401(k) balance. The terms of the loan, including the maximum amount that can be borrowed, repayment schedule, and interest rates, are set by the plan. Loans must be repaid with interest, typically through payroll deductions.
18. How do hardship withdrawals work in the VIP?
Hardship withdrawals let you withdraw from your VIP account early when facing serious hardships or financial needs. This may include:
Paying medical costs
Becoming disabled
Buying a home
Paying college tuition
Preventing eviction or foreclosure
You will have to prove your hardship to qualify for a hardship withdrawal. Your withdrawals may still be subject to taxes and penalties as well. But in certain cases, this may be your only option.
19. Can I contribute to my Boeing VIP during a furlough or temporary layoff?
During a furlough or temporary layoff, contributions to your VIP account will be suspended. This is because your contributions are deducted from your paycheck. Once you return to work and resume receiving pay, you can begin contributing to your VIP again. If you receive any back pay, you can include that in your contributions as well.
20. How can I protect my VIP investments as I get closer to retirement?
To protect your VIP investments from market volatility as you approach retirement, consider doing the following:
Gradually shift your investment mix from higher-risk stocks to lower-risk bonds and other fixed-income securities. (If you opted for a lifecycle fund, this will happen automatically as you near retirement.)
Ensure that your investments are spread across various asset classes to mitigate risk (A.K.A. diversification)
Consult with a financial advisor to tailor your investment strategy for your retirement timeline.
21. What options are available if I become permanently disabled?
If you become permanently disabled, you may be able to access your VIP funds without the 10% early withdrawal penalty, regardless of your age. You’ll need to provide documentation confirming your disability as defined by the IRS.
22. How does Boeing's VIP compare to other major corporations' 401(k) plans?
Boeing's VIP is competitive with other major corporations’ 401(k) plans, offering:
Generous matching contributions
Valuable investment options
Reasonable fees
Resources for financial planning
Overall, Boeing employees have access to a great opportunity to save for retirement.
23. How are dividends handled in the Boeing VIP?
Dividends earned on investments within your Boeing VIP are automatically reinvested into the respective funds, leading to compound growth. This reinvestment strategy helps to grow your portfolio over time without any active management required on your part.
24. How often can I change my investment choices within the Boeing VIP?
You can change your investment choices within the Boeing VIP at any time through the online portal. However, it is wise to consult with a financial advisor before making frequent changes, as this could impact your long-term savings and tax strategy.
25. Can I Get Help with My Boeing VIP?
Yes! Getting advice for your Boeing VIP is essential for making the most of your retirement plans. At TrueWealth Financial Partners, we will take time to understand your unique needs and goals. Then, we will help you craft a strategy that will maximize your savings.
Schedule a free call today, and we’ll be happy to answer all your questions. Let’s talk!
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