After decades of hard work in one of America’s toughest industries, you’ve earned every dollar of your pension, but when it comes time to claim those benefits, the decisions can be anything but straightforward. Refinery and energy sector workers often face some of the most complex pension structures out there, with layered options, lump sum offers, annuity variations, and the big question: What’s the smartest way to claim?
At Stirling Capital, we specialize in helping refinery and energy employees navigate these pivotal moments. We understand that claiming your pension isn’t just a financial decision; it’s a life decision.
Understanding the Complexity Behind Pension Choices
For many refinery and energy professionals, a pension is the cornerstone of retirement income, and yet, claiming it is rarely as simple as “when do I want to retire?” Factors like your years of service, age, marital status, health, and the broader economy all influence what’s truly best for you.
Consider this: two coworkers with the same title and years of experience could end up with very different outcomes simply because of when and how they claim their pensions. One might choose a lump sum to invest and control personally, while the other might prefer an annuity for lifetime income security. Both options have their merits, but each carries unique risks and tax implications that deserve a closer look.
Lump Sum or Annuity? How to Decide What’s Best for You
One of the most common and consequential decisions you’ll face is whether to take your pension as a lump sum or as an ongoing monthly payment (an annuity).
A lump sum can offer flexibility and control. You can invest it, consolidate it with other retirement accounts, and create your own withdrawal plan. However, it also places the responsibility on you to manage the funds wisely for the rest of your life.
An annuity, on the other hand, offers steady income for life, sometimes with survivor benefits for your spouse, but less flexibility if your needs or goals change down the line.
Neither choice is universally better. The “right” answer depends on your specific situation, including your savings, health, family needs, and what kind of retirement you envision. Here’s where professional guidance matters the most. Our team runs in-depth pension claiming analyses that help you see how each scenario plays out over time, including the tax impact, inflation considerations, and coordination with Social Security.
Timing Is Everything
Many refinery and energy employees have the opportunity to retire earlier than traditional retirement age. That’s great news, but it adds another layer of strategic consideration.
If you’re thinking about retiring in your 50s or early 60s, you’ll want to plan carefully for how your pension income fits with other assets. How will you bridge the gap until Social Security kicks in? What’s the best way to draw income without triggering unnecessary taxes or penalties? And how does your pension decision interact with your 401(k), stock options, or healthcare coverage?
These are big-picture questions with long-term implications. Our team helps you evaluate every moving part, so your retirement isn’t just designed to start strong, but to stay strong.
You’ve Earned It, Now Let’s Make It Work for You
You’ve put in the hours, the shifts, and the dedication. Claiming your pension should feel like a reward, not a riddle.
We believe your retirement deserves the same thoughtful planning and discipline that defined your career. Our goal is simple: to help you make confident, informed decisions about your pension, so your next chapter is every bit as rewarding as the years you’ve worked to reach it.
Our approach begins by understanding your full compensation picture including your pension, 401(k), company stock, benefits, and beyond. From there, we design a claiming strategy that fits your goals, whether that means maximizing your lifetime income, retiring early, or leaving a legacy for your family. And because your industry, benefits, and life circumstances evolve, our partnership continues well beyond the decision point. We monitor and adjust your plan as interest rates shift, markets move, and your priorities change.
If you’re approaching retirement or simply want to understand your options, now’s the time to start the conversation. Schedule a consultation with our team at Stirling Capital to help ensure your pension works as hard for you as you’ve worked for it.
*The information given herein is taken from sources that IFP Advisors, LLC, dba Independent Financial Partners (IFP), IFP Securities LLC, dba Independent Financial Partners (IFP), and its advisors believe to be reliable, but it is not guaranteed by us as to accuracy or completeness. This is for informational purposes only and in no event should be construed as an offer to sell or solicitation of an offer to buy any securities or products. Please consult your tax and/or legal advisor before implementing any tax and/or legal related strategies mentioned in this publication as IFP does not provide tax and/or legal advice. Opinions expressed are subject to change without notice and do not take into account the particular investment objectives, financial situation, or needs of individual investors. This report may not be reproduced, distributed, or published by any person for any purpose without IFP’s express prior written consent.
