P&G Employee Profit Sharing Trust (PST) and 401(k) Savings Plans offer employees generous, well-diversified, low cost investment opportunities with P&G stock as its focus – however they pose elevated concentration risk should they decide to leave the company.
Navigating a separation package or early retirement offer with confidence can make all the difference – that’s why working with an advisor who has experience managing P&G retirement plan assets should be your first priority.
As P&G stock has continued its upward trajectory, participants in our PST plans are asking us more and more questions. Generous employer contributions combined with strong P&G performance has given many employees a comfortable retirement plan.
No matter the market condition, P&G employees should carefully consider their PST plan options as they prepare to leave the company and start withdrawing assets from their savings plan assets. We strongly suggest consulting a Mariner Wealth Advisor who can assess your individual circumstances and offer objective guidance and recommendations.
Our P&G retirement specialists have carefully examined the current rules and regulations surrounding the PST plan, and would like to share our insights with you. We have identified several changes which we believe could enhance employee experience:
P&G could explore ways to further increase their selection of investment options while improving personal planning capabilities through features like automatic escalation that could have a major impact on retirement outcomes. According to research, such features have proven extremely helpful.
P&G retirees who utilize the PST plan have access to an invaluable tax benefit called trustees’ cost and net unrealized appreciation (NUA). While taking into account NUA requires careful thought, it could result in substantial federal tax savings for them. We oversee lump sum distributions from this plan daily and can work with you to assess whether this strategy would work in your personal situation.
PST plan participants can choose to take a lump-sum distribution and roll it over into an Individual Retirement Account (IRA). While this may offer greater flexibility, its resulting distribution will still be taxed at ordinary income rates. By taking advantage of an IRS ruling and selling P&G shares at long-term capital gains rates instead, our clients have been able to save thousands of dollars on taxes using this NUA strategy – for instance a hypothetical couple in Scenario two could save $8784 by following this procedure! We’d be more than happy to discuss all details with our clients!