Sprint employees have an exceptional opportunity to maximize their retirement savings without incurring extra tax consequences. You can take advantage of what’s known as Mega Backdoor Roth to invest in up to five times their regular 401(k) contribution directly in a Roth IRA — this strategy may not be ideal, but according to IRS rules it may provide the greatest returns.
Sprint’s pension plan is a defined benefit plan, meaning retirees receive a set monthly payment throughout their lives. However, this plan has some unique aspects. One such feature is called “brokerage window,” which enables workers to invest much like they would at any regular brokerage firm by buying virtually everything available in the market – this offers plenty of choice but could prove potentially dangerous without proper guidance.
Sprint’s plan also allows employees to invest in Sprint stock and options, something not often offered in companies but which provides another means of keeping employees satisfied while making the plan even more valuable.
Sprint offers an outstanding 401(k) matching program. They match 100% of your first 3% contribution and 50% on any subsequent contributions beyond that – truly an impressive offer.
Staying aware of your Sprint 401(k) account is crucial, since benefits could change at any time. Signing up for email alerts can keep you in the know regarding what’s going on with your retirement plans.
Sprint’s retirement pension plan faces another issue due to its use of outdated mortality data in calculating payments for some married workers, according to plaintiffs who allege this violates ERISA and reduces their retirement benefits. They note that Sprint’s formula for calculating JSA/PSA benefits does not meet legal requirements and do not resemble an annuity with single life annuity equivalent actuarially equivalents required by law.
The $3.5 million settlement agreement pending preliminary court approval should increase monthly payments for JSA and PSA participants, including Sprint retirees who began receiving 50, 75 or 100 percent of their benefits as JSA or PSA benefits after November 11, 2016 through a JSA or PSA plan. It covers more than 1,000 retirees. Once court approval is given for distribution purposes, the money will be divided among them accordingly. Lawsuits were filed in U.S. District Court in Kansas.