Best Companies to Retire With
1. IBM
IBM sets what some regard as a gold-standard in 401(k) plans.
Automatic company contributions run up to 4% of pay, while the firm matches employee savings up to 6% of pay.
Milton Moskowitz of management consultancy Great Place to Work Institute calls it “spectacular.” What impresses Moskowitz most is the free, one-on-one financial advice IBM offers employees.
Does it work? Since the start of 2008, with the markets crumbling and the average savings plan at Fidelity down 27%, IBM’s 401(k)s have fallen just 12%.
2. Procter & Gamble
Established in 1887, Procter & Gamble’s employee stock plan is the oldest in the nation.
P&G contributes cash and preferred stock to each employee’s account, scaling its payments for each year of service, up to 18% of pay, after 20 years at the company.
Benefits director Tom Mess says the scalable trust plan “encourages top talent to stay with P&G,” while guaranteed contributions from the first year of employment are attractive to younger recruits who may not want to wait two decades to see their first payments.
One drawback: Employees have only partial control of their trust fund, since 40% of the company contributions must remain in P&G stock.
3. Sherwin-Williams
At the paint company, retirement benefits — like pension, 401(k) matches, and health care — expand over time.
After 35 years of service, retirees can walk away with the company covering 80% of their medical costs. The retiree medical fund extends beyond age 65 to supplement Medicare by covering expensive prescriptions that Medicare doesn’t pick up.
It’s a notable perk, says investor-relations director Mike Conway, since “a lot of companies did away with their prescription drug plans after [Medicare was reformed in] 2003.”
4. Alcon Labs
As befits a company in the medical industry, eye-care firm Alcon takes care of its own. It is one of a handful of companies that maintains both a 401(k) program as well as a defined-contribution money purchase plan.
Employees get cash contributions from the company, worth 7% of their pay, and dollar-for-dollar matching of their 401(k) savings, up to 5% of pay.
Benefits director Don Snyder says the dual plans make it possible for the company to finance a full extension of an employee’s medical insurance until Medicare kicks in at age 65, and then supplement Medicare for life.
5. Principal Financial Group
The financial management company has a mix-and-match system.
The company offers 75% matching on employee 401(k) donations, up to 8% of pay, while two defined-benefit plans scale up over an individual’s career and, in some cases, top out at 14% of pay.
Together, for a retiree who has spent 25 to 30 years at the company, the plans can provide the equivalent of a full salary for life, as well as perks like health care and financial advising.
6. Devon Energy
In 2007, when Devon Energy set out to redesign its retirement program, management had young employees in mind.
Explains Sue Alberti, vice president for benefits, “Because of layoffs in the industry in the 1980s, there is huge pressure to get young people. What do we need to do to attract that top talent and retain them?”
The result: a 401(k) plan that lets millennial-generation workers control their own finances and keeps them there by scaling up over their years of service to top out at 22% of pay, along with medical coverage.
The system is working — the number of applicants per job has tripled since the new plan was introduced.
7. NuStar Energy
NuStar Energy, a pipeline and logistics company, offers employees a combined plan, but the pension pulls most of the weight.
That’s especially notable since NuStar is a young company — it opened for business in 2001, long after most companies began ditching their defined-benefit plans in favor of individual savings accounts.
NuStar’s pension gives retirees their full salary for one-and-a-half times their years of service: work 20 years and get 30 years’ worth of your full pay, assuming you haven’t retired early. That’s in addition to dollar-for-dollar 401(k) matching, up to 6% of pay, and a $1,000-deductible medical plan.
Human resources director Bill Grimes says the rich benefits have helped the startup lure talent from more established companies.
8. Weyerhaeuser
Papermaker Weyerhaeuser has both a pension and a 401(k) plan.
Company matching on its 401(k) totals a modest 3% of pay, and the pension plan scales up over years served.
What sets the firm apart is the training it offers employees to manage their retirement dollars, the core of which is a three-day seminar called “Healthy, Wealthy and Wise.” It’s open not only to employees but to spouses and families as well.
Most importantly, Weyerhaeuser encourages employees to take time off work to attend.
By:Fortune.com