How to Maximize Your Boeing Benefits Package
April 15, 2022
Boeing employs over 7,500 people in South Carolina (out of a total Boeing workforce of 160,00 worldwide). (1) As a financial advisor in South Carolina, I’m quite aware of the company’s employee benefits package and its nuances.
In this article, I’ll walk you through some simple ways to optimize your benefits, so you can make sure you’re making the most of what this large corporation has to offer.
Here’s how to optimize your Boeing benefits package:
How do I optimize my 401(k) match as an employee at Boeing?
Boeing matches 401(k) contributions dollar for dollar, up to 10%. This means that if you make $100,000 a year, you can contribute $6,000 and Boeing will throw in another $10,000 to boot.
You won’t find this kind of return anywhere else in the market. If you haven’t already, adjust your paycheck withholdings so you’re contributing enough to get the full employer match. It’s a 100% return on your investment.
Take It A Step Further By Maxing Out Your Boeing 401(k) Completely
Maxing out your 401(k) is one of the easiest ways to reduce your taxable income for the year. It also gives a nice boost to your retirement savings.
For 2022, you can contribute up to $20,500 to your 401(k). (2) If you’re at least 50, you can save an additional $6,500 in catch-up contributions for a total of $27,000.
Many people forget to bump up their contribution limit when they turn 50 to account for this increased limit, so set a reminder if your 50th birthday is on the horizon.
Diversify Your Boeing 401(k) Holdings
Boeing automatically invests your 401(k) match and optional profit sharing in the Boeing ESOP Fund or the Boeing Non-ESOP Fund. This is essentially Boeing stock and is susceptible to volatility and large declines in value just like owning the actual stock ($BA).
If you’re holding too much of this Boeing “stock,” consider diversifying out of it. It’ll mitigate your risk and ensure your wealth isn’t wiped out if the stock value decreases.
Consider Roth Contributions
Roth accounts can play a large part in helping you minimize taxes and maximize your retirement savings. Depending on your financial situation, it may make sense to contribute to your company Roth 401(k) or a backdoor Roth IRA.
This step is more difficult to complete than the others, so you may need help from an expert to figure out if Roth contributions are something you should consider..
At Meridian Financial, we help you evaluate whether to put money into the Roth component of your Boeing 401(k). We also evaluate the viability of doing an annual backdoor Roth IRA.
Backdoor Roth IRAs, in particular, require precise timing to avoid taxes. Our team can help you figure out if they should be a part of your overall wealth plan.
Update Beneficiaries For Boeing 401(k) Plans
Many people I work with forget to update the primary and contingent beneficiaries on their 401(k) plans. We’ve seen many instances where our client thought they had the correct beneficiaries listed. But after receiving a printed beneficiary confirmation statement, it was clear that either the wrong beneficiary was listed, no beneficiary was listed, or it was missing contingent beneficiaries.
Moral of the story? Request printed beneficiary confirmation statements for your accounts and make sure you’ve listed the correct beneficiaries.
Max Out Your Boeing HSA Contributions
If you have a high-deductible health insurance plan, you’re eligible for a health savings account (HSA). HSAs are unique because they’re 100% tax free: contributions are tax-free, money held in the account grows tax-free, and withdrawals are tax-free. You can use them to cover most medical expenses, including prescriptions, doctor visits, and even eyeglasses.
For 2022, you can contribute up to $3,650 if you have a self-only insurance plan and up to $7,300 for a family plan.
Boeing also offers employer matching when you and your spouse complete a list of “activities” in your account dashboard.
Review Your Boeing Long-Term Incentive Compensation Plan
If you’re a highly compensated Boeing employee, you may have access to a long-term incentive compensation plan. This plan is often made up of awards, such as:
· Stock options
· Stock appreciation rights
· Restricted stock and restricted share rights
· Performance shares and performance units
· Stock awards
If you hold any of these, it may be beneficial to go over the details of each with an experienced professional who can help you optimize them.
For our clients, we typically come up with a multi-year strategy to diversify out of company stock and mitigate investment risk. We also maintain a detailed record of the terms of each award, its vesting schedule, and any potential tax consequences. We then strategize ways to minimize these taxes and even estimate taxes due so there are no surprises.
How We Help Boeing Employees
At Meridian Financial Advisory, many of our clients are Boeing employees whom we’ve helped maximize and optimize their benefits. (As I previously mentioned, my wife also works at Boeing, so I’m keenly aware of your plan options.) If you’d like professional help making sure you get the most out of all your benefits have to offer, schedule an introductory phone call using our online calendar or reach out to us at (413) 949-6574 or email@example.com.
Joshua Henry is the founder and Managing Principal of Meridian Financial Advisory, an independent, fee-based wealth management company located in South Carolina, serving people locally and across the country. Meridian focuses on providing wealth management solutions to affluent individuals over age 50 and their families. Joshua is passionate about helping people have a better life by designing and implementing customized financial plans that bring clarity and confidence. Joshua is a CERTIFIED FINANCIAL PLANNER™(CFP®) and earned a Bachelor of Arts degree in Political Science from Cedarville University and a Master of Business Administration degree with a concentration in Corporate Finance from Salve Regina University. The courses for the Corporate Finance concentration were taken from the Kelley School of Business at Indiana University. He has held workshops on Social Security Claiming Strategies, IRA Planning, and Career Coaching for Executives in between jobs. Josh has also taught finance at the university level. When he’s not working, Josh teaches adult Sunday School at his church in Pawley Island, SC. He enjoys traveling, reading, and time with his family. To learn more about Josh, connect with him on LinkedIn.