Rate Watch 2018 – March

Welcome to another edition of Rate Watch as we track the interest rate that is vital to the grandfathered pension at Southern California Edison. If you’ve missed any of our previous articles, you can find them here:

Rate Watch 2018 – February
Rate Watch 2018 – January

Rate Watch 2017 – August
Rate Watch 2017 – July

The second rate of 2018 is an interesting one as it comes a couple days before the Fed’s announcement to raise interest rates 0.25% on March 21st, 2018,  but let’s take a look at the most recent numbers:

March 2018

*These are not current plan rates for Southern California Edison’s pension plan, they are minimum present value third segment rates from the IRS. Official plan rates are derived from the minimum present value segment rates table (https://www.irs.gov/retirement-plans/minimum-present-value-segment-rates) . Plan rate changes are made by Southern California Edison on an annual basis.

February’s reading takes us closer to the current grandfathered rate for 2018, 4.36. This would bring very little change to your lump sum grandfathered pension value as of right now, but it could be an indicator of where rates could end up in the fall. Again, we can’t emphasize enough, it is still early in the year and rates could go anywhere as the months continue.

One of the most interesting factors for following months will be if the Fed increasing interest rates will have any impact on minimum present value segment rates, which are the rates used to determine the official grandfathered rate in the fall.

Remember, your grandfathered pension is just one of many factors that you should examine when thinking about retirement. There are many moving parts that extend further than interest rates and lump sum payout values.

Unsure if you are on the right track for retirement? Concerned about your 401(k) or other retirement investments? Contact us for a free retirement goals session or portfolio analysis.

Joe OcchipintiJoe Occhipinti
Wealth Advisor
Warren Street Wealth Advisors





Joe Occhipinti is an Investment Advisor Representative of Warren Street Wealth Advisors, a Registered Investment Advisor. Information contained herein does not involve the rendering of personalized investment advice, but is limited to the dissemination of general information. A professioanl advisor should be consulted before implementing any of the strategies or options presented.

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