Fidelity Investments^® Simplifies Pension Collection for Workers on The Verge of Retirement

New Online Educational Tools Help Employees Make More Informed Decisions about Pension Payment Options; Elections Completed in 3 Easy Steps

BOSTON -- Fidelity Investments^®, service provider to one in 10 U.S. corporate pension plan participants¹, today announced the launch of a robust online resource center designed to help workers on the verge of retirement make more informed decisions as they initiate the process of collecting their pensions.

Under a newly created section of Fidelity’s participant website NetBenefits^®, called Collect Your Pension, workplace pension plan participants can now go online and initiate their pension payments in three easy steps. 

With Fidelity’s Collect Your Pension, which is being offered to Fidelity record-kept corporate pension plans nationwide, employees now have access to a series of online educational materials to guide them through this important milestone. The materials not only outline the basics of pension payments (annuity payments, lump sum payments or a combination of both), but also explain some of the advantages and consequences associated with each payment type (e.g., lump sums are taxed immediately unless rolled over into a tax-advantaged vehicle). Other materials explore common concerns (e.g., outliving savings, leaving money to heirs). The new materials include a five-minute instructional video, an article “How to Take a Pension Payout,” a checklist “Initiating Your Pension” and links to pension calculators and a retirement income planning tool.

“With almost 3 million Baby Boomers turning 65 this year, many Americans are contemplating retirement and seriously examining their pensions for the first time,” said Wendy Foster, senior vice president at Fidelity Investments. “Some are unclear which payment option best suits their needs. They may not realize that the decisions they make are irrevocable or that some employers allow the pension initiation process to begin six months in advance of retirement.

“As a retirement leader in the financial services industry, we are determined to assist workers at this critical juncture by providing key educational tools that will help them make the best financial decisions for their circumstances as they transition into retirement,” Foster said.

Collect Your Pension Streamlines the Retirement Planning Process
When employees log on to Collect Your Pension, they will be guided through a step-by-step process to initiate their pension collection completely online or with assistance from phone representatives. The process is as follows:

• Step 1 -- Choose Your Payment Option(s): Participants are informed of the payment options available with their particular pension plan. Using a modeling tool, individuals can view different payment scenarios based on their retirement date and beneficiary choices (e.g., a single life annuity payment would be larger than an annuity with survivor benefits).

• Step 2 -- Decide Where You Want the Money to Go: Plan participants selecting a form of annuity are prompted to enter tax withholding information and bank account information that is immediately validated for entry error. If selecting lump sums, they are given the option of taking a taxable distribution or rolling the money into a tax-protected account, such as an IRA or qualified retirement plan such as a 401(k).

• Step 3 -- Confirm and Sign Your Documents: A new eSignature capability enables eligible² pre-retirees to sign their documents electronically and submit. Individuals can monitor how their pension initiation is progressing (e.g., when they will receive their first check) and continue to use NetBenefits to track their ongoing payment status online.

Individuals Requesting Lump-Sum Distributions Offered Additional Assistance
With many Americans opting to take lump-sum distributions from their pension plans, Fidelity offers specially trained representatives who can assist these retirees in developing a retirement income strategy and determining whether a lump-sum distribution may be the right decision for them. The representatives take a holistic approach to assessing an individual’s goals in retirement and evaluating the best way to achieve his/her income needs based upon the individual’s entire assets, including any 401(k), pension, IRA, brokerage and other accounts. The service is free and is available over the phone or in person at a Fidelity Investor Center.

Fidelity is one of the top three corporate pension service providers in the United States. The firm services 120 corporate employers with 684 plans, representing 4.2 million participants. Each year, it processes more than 100,000 retirement initiations and services more than 1 million retirees. Fidelity began recordkeeping pension plans in 1995³.

About Fidelity Investments
Fidelity Investments is one of the world’s largest providers of financial services, with assets under administration of more than $3.7 trillion, including managed assets of nearly $1.7 trillion, as of April 30, 2011.  Founded in 1946, the firm is a leading provider of investment management, retirement planning, portfolio guidance, brokerage, benefits outsourcing and many other financial products and services to more than 20 million individuals and institutions, as well as through 5,000 financial intermediary firms.  For more information about Fidelity Investments, visit www.fidelity.com.
 

1 Cerulli Associates Quantitative Update Retirement Markets 2010 and Fidelity internal data
2 Spousal consent is required for married pre-retirees via notarized documentation sent through the mail
3 All information in this paragraph is Fidelity internal data

Guidance provided by Fidelity is educational in nature, is not individualized and is not intended to serve as the primary or sole basis for your investment or tax-planning decisions.

Fidelity Brokerage Services LLC, Member NYSE, SIPC 900 Salem Street, Smithfield, RI

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