Find Financial Advisors for Raytheon Technologies (RTX) Employees & Executives: Q&A Insights from the Experts

Raytheon healthcare plans are typically HSA eligible which means maximum account contributions of $3,650 for individuals or $7,300 for families (2022 values). The HSA is a fantastic way to lower taxable income at contribution, the money can be invested to grow tax-free, and withdrawals are tax-free if used for eligible medical expenses. Bonus points – the contributions to an HSA get to dodge Social Security and Medicare taxes if funded through payroll contributions. Building up a massive HSA balance can be an effective way to pay for Medicare premiums in retirement or self-insure for long-term care (LTC).

Another fantastic benefit is the group legal plan – a very cost-effective way to get estate planning documents like wills and trusts drafted for about $240. Normally, these documents cost several thousand dollars. Employees can choose the plan during open enrollment, pay for a year of the service, get documents created, and decline coverage during the next year’s open enrollment.

A common challenge among Raytheon employees, particularly those who are entering retirement, is the large tax-deferred balances in their 401(k) plans. If not mitigated, Required Minimum Distributions (RMDs) can cause a massive tax bill after age 72.

It’s important for retirees to work with a competent financial planner and develop a strategy to get ahead of RMDs during lower-income years. Typically implemented in the “tax planning window” between retirement and age 72, tools can include Roth conversions, delaying Social Security, and withdrawing from taxable accounts.

Questions to ask a potential advisor include:

• Do you act as a fiduciary (in my best interest) at all times?
• How are you compensated? Do you sell any products?
• How much (in dollars) can I expect to pay now and in the future?
• Do you require me to move my assets, or can you provide advice only without investment management?
• Do you focus solely on investments, or do you also advise on other important areas like tax planning, estate, retirement, debt/cash flow management, and insurance?
• What is your investment philosophy?
• What professional credentials do you hold?

When working with Raytheon employees, I start by helping them understand the full scope of their benefits package—because maximizing retirement readiness begins with leveraging what’s already available. I focus on strategies that integrate the Raytheon savings plan (such as the RTX 401(k) with potential employer match), as well as supplemental benefits like the Employee Stock Purchase Plan, all within a broader financial plan.

We explore contribution limits, Roth versus traditional deferrals, and tax-efficient withdrawal strategies to enhance long-term growth potential. I also guide clients through decisions around pension options and deferred compensation, ensuring they align with their broader retirement goals and cash flow needs. Ultimately, I tailor each strategy to the individual’s career stage and life priorities, bringing clarity to complex choices and helping them confidently move toward financial independence.

When I first meet with a Raytheon employee, my goal is to understand both their financial picture and what truly matters to them—because a great plan is built around purpose, not just numbers.

I typically start with questions like:

• What areyour short-term and long-term goals—both personally and financially?
• How confident do you feel about your current retirement strategy?
• Are you aware of all the benefits available to you through Raytheon, and are you using them to their full advantage?
• Do you have other financial priorities right now, like college savings, buying a home, or reducing taxes?

I also want to understand any life transitions on the horizon—whether it’s a career change, relocation, or family event—so we can anticipate and plan proactively.

These conversations often uncover opportunities to optimize their current benefit elections, adjust savings strategies, or build in tax-efficient planning. Ultimately, it’s about crafting a plan that’s aligned with their values, evolves with their life, and gives them peace of mind.

One particularly powerful but underutilized benefit available to Raytheon employees in 2025 is the ability to implement a backdoor Roth strategy through the RTX 401(k) Plan (RAYSIP).

Raytheon allows employees to make after-tax contributions beyond the standard pre-tax and Roth limits—up to the 2025 total contribution cap of $70,000 (or $81,250 for ages 60–63 with catch-ups). These after-tax dollars can then be converted to Roth within the plan, creating a significant opportunity for long-term, tax-free retirement growth. Despite its potential, many employees overlook this option due to its complexity or lack of awareness.

Another valuable and often overlooked benefit is the MetLife Group Legal Plan, still available in 2025. For a modest monthly payroll deduction (typically $16–$20/month), Raytheon employees can access estate planning services like wills, trusts, and powers of attorney at no additional cost. It also covers a wide range of personal legal matters—without deductibles or copays when using in-network attorneys.

Both benefits can make a meaningful difference when incorporated into a thoughtful, comprehensive financial strategy. Helping employees understand and confidently navigate these opportunities is a key part of the work I do.

Absolutely—beyond retirement savings, Raytheon offers several benefits that can significantly enhance a client’s financial well-being when integrated into a broader plan.

One standout is the Employee Stock Purchase Plan (ESPP), which allows employees to purchase RTX stock at a 15% discount through payroll deductions. This can be a powerful tool for long-term wealth accumulation, especially when paired with a disciplined diversification strategy.

Raytheon’s Employee Scholar Program is another exceptional benefit. It provides 100% reimbursement for tuition, books, and fees for approved degree programs—with no cap on the number of degrees. For clients looking to advance their careers or pivot professionally, this is a tremendous value.

The Health Savings Account (HSA), available with Raytheon’s high-deductible health plans, is also worth highlighting. Contributions are triple tax-advantaged, and Raytheon contributes to the account as well. For clients who can afford to pay current medical expenses out of pocket, the HSA becomes a stealth retirement account for future healthcare costs.

Lastly, the MetLife Group Legal Plan continues to be a cost-effective way for employees to access estate planning services like wills and trusts—services that are often overlooked but critically important.

These benefits often go underutilized simply because they’re not well understood. I help clients evaluate which ones align with their goals—whether that’s reducing taxes, funding education, or protecting their family’s future.

For Raytheon employees nearing retirement, the transition from a steady paycheck to drawing income from various sources requires careful planning and coordination. I guide clients through a multi-step process that helps them feel confident and in control of this next chapter.

We start by mapping out all available income streams—401(k), pension (lump sum or annuity), Social Security, brokerage accounts, and any deferred compensation. From there, we build a tax-efficient withdrawal strategy that balances income needs with long-term sustainability.

One key opportunity is to take advantage of the ‘income valley’—the window between retirement and the start of required minimum distributions (RMDs). During this period, we often implement Roth conversions, harvest capital gains at favorable rates, or draw down taxable assets to manage future tax brackets.

We also evaluate healthcare coverage, including retiree medical benefits and Medicare timing, and ensure estate planning documents are up to date.

Ultimately, it’s about replacing the predictability of a paycheck with a well-structured income plan that aligns with their lifestyle, values, and legacy goals. I help clients make this shift with clarity and confidence—so they can focus on enjoying the freedom they’ve worked so hard to earn.

For Raytheon employees who’ve done a great job managing their finances independently, the decision to work with a financial advisor often comes down to complexity and confidence. As they near retirement or experience major life transitions, the stakes get higher—and so does the value of having a second set of eyes.

I encourage them to consider a few key questions:

• Are you confident in your retirement income strategy—including how and when to draw from your 401(k), pension, and Social Security?
• Have you evaluated the tax impact of your decisions, including Roth conversions, RMDs, and capital gains?
• Do you have a plan for healthcare costs, estate planning, and legacy goals?
• Are you making the most of Raytheon’s more advanced benefits—like deferred compensation, the backdoor Roth strategy, or the ESPP?

Raytheon employees often encounter unique planning challenges that stem from the structure of their compensation, evolving retirement benefits, and the tax implications of various elections. One common issue is navigating the transition from legacy pension plans to cash balance plans following the merger with United Technologies. Many employees are unsure how to weigh lump sum versus annuity options, or how these fit into their broader retirement income strategy.

Another challenge is the underutilization—or mismanagement—of advanced savings opportunities like after-tax 401(k) contributions and in-plan Roth conversions. While Raytheon offers the ability to implement a backdoor Roth strategy, many employees either miss the conversion step or don’t understand the tax implications, which can lead to missed opportunities or unintended tax bills.

Deferred compensation planning is also a key area of concern, especially for higher-level employees. Elections must be made well in advance and are irrevocable, so aligning those decisions with future cash flow needs and tax brackets is critical.

Finally, equity compensation—such as RSUs and ESPP participation—can create concentrated stock risk and unexpected tax consequences if not managed proactively.

I help clients overcome these challenges by building integrated plans that coordinate all these moving parts. We model different scenarios, optimize tax strategies, and ensure that each decision—from pension elections to stock diversification—is aligned with their long-term goals. The goal is to bring clarity to complexity and help them make confident, informed choices.

I always encourage Raytheon employees to ask prospective financial advisors questions that go beyond investment performance. The goal is to find someone who understands the nuances of Raytheon’s benefits and can provide truly personalized guidance. Here are a few key questions to consider:

• Do you have experience working with Raytheon employees or are you familiar with the RTX Savings Plan, pension options, and deferred compensation?
• Do you act as a fiduciary at all times—and can you explain what that means in practice?
• How are you compensated? Are there any commissions or product sales involved?
• Can you help me with more than just investments—like tax planning, estate strategies, and benefit elections?
• What is your process for building a retirement income plan that includes my 401(k), pension, Social Security, and other assets?
• How do you stay up to date on changes to Raytheon’s benefits and the broader financial landscape?
• What kind of ongoing support and communication can I expect from you?

These questions help uncover whether an advisor is not only technically competent but also aligned with your values, communication style, and long-term goals. It’s about finding a partner—not just a portfolio manager.

One thing that frequently comes up—and surprises both me and the Raytheon employees I meet with—is just how underutilized and complex their benefits package can be, especially for those who’ve spent years with the company.

Many are unaware of advanced planning opportunities like after-tax 401(k) contributions and in-plan Roth conversions (a backdoor Roth strategy), or they haven’t evaluated deferred compensation elections, which require early, irrevocable decisions that can significantly impact future cash flow and taxes.

Pension decisions are another common challenge—particularly for employees navigating the transition from legacy defined benefit plans to cash balance formats after the Raytheon–UTC merger. Choosing between lump sum and annuity options often comes with uncertainty and wide-ranging financial implications.

It’s also surprising how many employees have accumulated substantial retirement savings but haven’t yet mapped out a coordinated withdrawal strategy—one that aligns income sources like 401(k), pension, and Social Security while managing taxes across retirement.

Lastly, I often discover that clients are paying into the MetLife Legal Plan but haven’t taken advantage of the included estate planning services such as wills, trusts, and powers of attorney.

These realizations can be eye-opening—and they reinforce how valuable it is to work with someone who can integrate all these moving parts into a cohesive, personalized strategy.

For highly compensated Raytheon employees and executives, there are several specialized benefits that warrant close attention when building a comprehensive financial plan.

One of the most impactful is the RTX Compensation Deferral Plan, which allows eligible employees to defer salary, bonuses, and other compensation beyond IRS limits. This can be a powerful tool for managing taxable income and aligning cash flow with future retirement needs. Timing and structure are critical, as elections must be made in advance and are irrevocable.

Executives may also receive Performance Share Units (PSUs), Restricted Stock Units (RSUs), and Stock Appreciation Rights (SARs) through Raytheon’s Long-Term Incentive Plans. These awards come with vesting schedules, tax implications, and concentration risk—especially when combined with 401(k) holdings and ESPP participation. I help clients evaluate when to exercise, diversify, or hold based on their broader portfolio and tax strategy.

Additionally, Raytheon offers a Lifetime Income Strategy (LIS) within the 401(k) plan, which provides guaranteed income options. While this can be attractive for some, it may limit flexibility and preclude strategies like Net Unrealized Appreciation (NUA), so it’s important to assess fit on a case-by-case basis.

Finally, executives should consider supplemental disability insurance and legal benefits that go beyond standard offerings, especially given income levels that exceed base policy caps.

These benefits can be incredibly valuable—but only when integrated thoughtfully into a broader plan that considers taxes, timing, and long-term goals.

One particularly memorable experience was working with a long-tenured Raytheon engineer who was approaching retirement and had accumulated a significant balance across multiple benefit plans—including a legacy pension, after-tax 401(k) contributions, deferred compensation, and unexercised stock options.

What stood out was how unaware he was of the tax implications tied to each of these accounts. For example, he hadn’t yet initiated in-plan Roth conversions on his after-tax 401(k) contributions, which meant he was missing out on a powerful backdoor Roth opportunity. He also hadn’t considered how his deferred compensation payouts would overlap with required minimum distributions, potentially pushing him into a much higher tax bracket.

Through our planning process, we were able to model different income scenarios, optimize the timing of his pension election, and implement a multi-year Roth conversion strategy during his lower-income retirement window. We also helped him diversify out of concentrated RTX stock positions and take advantage of the MetLife Legal Plan to update his estate documents.

That experience reinforced how uniquely complex—and potentially rewarding—Raytheon’s benefits can be when integrated thoughtfully. It also highlighted the value of proactive planning, especially for employees who’ve done a great job accumulating assets but haven’t yet mapped out how to turn them into a sustainable, tax-efficient retirement income.

Over the years I’ve worked with a lot of employees at Raytheon Technologies. It all starts with having critical knowledge of the benefits that are available to Raytheon employees. There are a couple that seem to be more useful and more valuable for a lot of people. For example the HSA plan: depending on your situation you might choose the silver or gold. Both plans let you contribute to an HSA, which is one of the only accounts that’s pre-tax going in, grows tax-free, and comes out tax-free for qualified expenses — a real triple benefit most people don’t get anywhere else. Being able to understand where that’s valuable in the client’s life, either for the near term or long term, and possibly helping them to set up a systematic investment plan for their HSA is valuable.

There are also other tools available to everyone, like the backdoor or mega backdoor Roth. It is an interesting financial long-term opportunity for investing and tax efficiency for retirement. This can be a great tool for people looking to retire maybe a little bit earlier and save a little bit more than the average person for their retirement.

Separately there is a series of healthcare benefits for retirees available to Raytheon employees. Knowing about those and maximizing those is pretty key. For employees that have been with Raytheon for a while, there may be some employees that have different retirement packages, which might include pensions. Understanding how those pensions interact with the other pieces of their retirement portfolio (so they can know when they might be able to retire and how much they need to be saving to be on track to retire when they’d like to) is very significant. It is a very significant piece of their overall financial situation and not factoring that in improperly can lead to maybe retiring a lot later than you needed to or possibly missing other opportunities (whether that be from a tax or investment standpoint) that could be valuable to you.

Lastly is the 401(k) investments. There are also a lot of 401(k) investments. There are actually what I would consider poor investments in the 401(k) that are available and really strong, low-cost, valuable investment opportunities. Getting the right mix is important because it could be a very big piece of their portfolio. That’s on top of the RTX Savings Plan’s own moving parts — the tiered company match, the age-based Company Retirement Contribution that shows up whether you contribute or not, and for longer-tenured employees, company stock sitting inside the plan that can come with real tax planning opportunities like NUA at retirement. Making sure that some discipline is applied to how that’s invested can really make a long-term difference and make sure nothing is missed out on in terms of potential there.

Those are some of the most common ones. There are also separate benefits for executives. For example executives may have some opportunity to decide whether or not they want to contribute or receive stock appreciation rights or stock shares. Helping to navigate the different risk, investment, and financial planning implications of those can be really valuable. For employees that are highly compensated, navigating the deferred compensation and how that might be useful versus what is heavily dependent on the lifecycle of where the employee is relative to their goals, their retirement, and their financial path in life is valuable.

Honestly when it comes to Raytheon employees, I know there are very unique aspects to their career that they are navigating. It’s about just understanding what’s important to them in terms of what is the money for? For most people, obviously, it’s going to be retirement. There may be very unique other aspects of their life and lifestyle. Those will help us understand what is going to be the shape of their plan: when they’ll need that money and how much risk they’re comfortable taking in order to achieve their long-term goals. What is the trajectory of their career or their family and how is that going to influence this plan?

Understanding these is the most fundamental component to building the financial plan. Before we can even determine which opportunities financially out there (in terms of investments, employee benefits, or tax planning techniques) may be most relevant, we have to first determine who we’re talking to. Then we can back into what’s going to help them along their path the best way possible. 

I think the mega backdoor Roth is one that is underutilized. Oftentimes I will run into employees that have saved so much over their lifetime and they never even knew about it even though they knew a lot about investing and taxes in general. If they didn’t take advantage of that over the number of years, that could be a huge missed opportunity. It’s not something every employer’s 401(k) even allows, but Raytheon’s does, which is exactly why it’s worth flagging early. Depending on how many years someone’s been eligible and how much they’d otherwise be saving into a taxable brokerage account instead, the tax savings can add up to a meaningful amount over a career. Not to say that there’s not a place for a brokerage account, because I think both make sense, but that’s one of the big ones.

I think, separately, another benefit that Raytheon employees could be using more than they do is the legal plan available through the benefits. More often than not when I’m first speaking to someone, they do not have the appropriate estate planning in place. The legal benefits available when you sign up for your employee benefits can cover that, right? That’s just an opportunity.

A lot of people even sign up for this with the intention to do it and then forget to do it. Obviously it’s an emotionally challenging topic to confront: the potential for death. Getting a will in place is something that almost everyone needs to do and so really making it more of a priority is the key here. When you’re paying for it you have an incentive. Otherwise that’s just wasted money. Might as well go ahead and get your value for what you’re putting aside for that.

The health savings account is great. A lot of people do know about that so it’s not necessarily totally unheard of. There are two different types of Plans that qualify for HSA.

I typically say that for families or people that are married with kids, or if they’re single and they have more health concerns, probably the gold HSA plans are the strongest option (because they keep the deductible relatively low while still qualifying as a technically high-deductible plan). 

They allow you to contribute to your HSA and also get that employer HSA contribution to that account, which is good.

If you’re single or you’re married with no kids that are on your health plan and you’re both in good health, you might do the silver plan to just keep your premiums really low. That also, I think, can be good for some people.

In some situations you might want to do the other plans and forgo the HSA. I know some people are just not comfortable with a higher-deductible plan and prefer to have a lower deductible. Even if the costs and economics work the same, it’s just psychologically easier for them to stomach just paying a flat rate and not having too many surprises, even if the flat rate is a lot higher.

Also for people planning for retirement, you can’t contribute to an HSA if you’re on Medicare. Those are other things to be aware of. That’s another reason why you might shift to a lower-deductible plan and not contribute to that.

For executives there’s a couple of things. There’s a whole different set of things, like possibly using stock appreciation rights as opposed to stock grants, as an opportunity for some people to at least consider different risks and rewards.

Of course tuition reimbursements are also a great opportunity for anyone really looking to progress their career to have the company contribute to your growth and development by taking different certificate programs and stuff like that that you can qualify for. 

For Raytheon employees thinking about leaving the company and accepting a job elsewhere, the important thing is just understanding your cash flows.

When you do change jobs you might be contributing to a 401(k) from your previous employer. If it’s mid-year you might have a brand-new 401(k). Making sure you don’t overcontribute is a key piece of how that is going to all shape up because if you overcontribute you could be subject to penalties. No one’s going to be keeping track of your 401(k) contributions for the year from your previous employer so you have to be responsible for that.

Separately there may be duplications in taxes that you might face if you’ve already exceeded the Social Security tax limit. You may be paying twice into that system so you may get a larger refund. Just being aware of that.

When you do sign up for a new employer, if you’ve been at your current employer for a while, you have to remember to set up your tax withholding correctly. If you’ve got family (or I suppose that works) or something special about your taxes, you may need to set up a specialized withholding schedule in order to not get surprised with taxes at your new job.

Consider if you’re receiving some sort of severance package from Raytheon. What to do with that? How are you going to be receiving that and what are the implications from a tax standpoint and a cash management standpoint? You don’t want that money just sitting in your checking account if it’s not something you need immediately. If you have another job lined up you might consider what the best use of that capital is, which could be a variety of different things, putting that into the context of your long-term plans.

Lastly and maybe most importantly, determining what the change is going to be in your household income, what you contribute to your retirement savings, and how that all fits into a broader financial plan for your most important life objectives is the main consideration you need to make.

When they’re approaching retirement age you really need to start factoring in:

– How much you’re going to need to have saved and invested
– How your investments need to be positioned
– What to do about your tax planning

These are the big three pieces and most importantly how much you need to have saved and invested, depending on your career. If you spent a lot of time at Raytheon, people who have been there for 20+ years probably have a pension. That means that’s going to be a big part of their overall retirement strategy. That’s just income that’s coming in on top of Social Security, which means the gap for the income that they’ll probably need to fill with sustainable portfolio withdrawals is a lot smaller, meaning their portfolio might need to be smaller.

One thing that catches people off guard: if you’re deciding between the lump sum and the monthly annuity, the lump sum isn’t a fixed number sitting there waiting for you — it’s calculated off IRS segment rates that get published monthly and move with the bond market. When those rates go up, the lump sum value goes down, and vice versa, so the specific quarter you retire in can swing that number by a meaningful amount, completely separate from anything about your own situation. It’s also worth knowing that RTX has been actively moving pension risk off its own books — they transferred a chunk of retiree obligations to Prudential in an annuity buyout that closed at the end of 2025 — so this is a plan sponsor that’s clearly thinking about de-risking, which is one more reason to have a real analysis done rather than defaulting to whichever option sounds simpler.

For those types of people, thinking about rules of thumb that they might need and that they read on the internet about how much people need to save for retirement might be completely different. It’s important to take an assessment of all your different resources, including income sources for you and investments for you and for your spouse, or any other pieces of your situation that may need to be factored in separately. If they determine what they need to have saved and invested, they might find that they have a couple years to go in order to get to a good place. There can be different adjustments that can help a client along that path. That’s where the investment and planning, from a tax standpoint or healthcare standpoint, come in.

On the healthcare side, if you’re retiring before 65, you’re bridging to Medicare somehow — COBRA, a retiree medical option if it’s available to you, or the marketplace — and that gap needs its own line item in the plan rather than an afterthought. On the tax side, the years between when you stop working and when Social Security and required distributions kick in are often the best window you’ll ever get for Roth conversions, since your income is naturally lower before those other sources turn on. Coordinating that with the pension election and when you start drawing from the portfolio is where a lot of the real value gets added.

Determining what the game plan is from here, just based on what you’re currently doing and where you need to be, what the right set of tools is that you should be using, and what the trade-offs of using them are, a financial planner can help them do that. If they have a really in-depth level of personal investment knowledge, healthcare planning knowledge, or tax planning knowledge, they can probably do a lot of things on their own. It might still help to work with a financial planner to streamline that process or add any pieces of expertise that they may need as they’re trying to make critical life decisions with the big retirement on the horizon.

Yeah obviously it costs something to work with an advisor, right?

They need to be comfortable with the value that they’re going to get out of that. I would think it’s hard to oftentimes just translate a service into something that’s really tangible although a lot of it can be measured.

Think about the following common reasons people choose to work with an advisor:

• Are they looking for the financial optimization of getting additional expertise and analysis of their situation?
• Are they trying to make decisions and finding it difficult?
• Are they facing change that is challenging to navigate without a clear financial plan?
• Are they looking for help with retirement?
• Are they just looking to get more time back on their schedule?

There’s also just the value of having someone in your corner who understands and has a lot of knowledge about you and the broader options and possibilities you face. They can help you with those decisions using their planning, judgment, and expertise layered on top of you.

The question becomes, “can the person you choose be empathetic, and capable of really putting themselves in your shoes?”

Part of it is going to be just understanding the landscape of options that they face. One of the big pieces that they really need to watch out for is all the different models of financial services.

It’s critical to understand the difference between a fee-based advisor who may be double dipping in terms of how they’re getting compensated (from commissions and products that they’re selling, but also from fees from the client) and a fee only advisor. This double-dipping has the potential to introduce additional conflicts of interest to an advisory relationship. It may bias the advisor to putting a compensation schedule ahead of what may be truly in the client’s interests. That doesn’t always mean actually recommending a bad product but it just may steer the discussion away from what the client might need the most help with (such as areas that don’t offer commissions, like tax planning or helping with Medicare planning decisions).

It’s not to say that that’s always going to completely ruin the ability to have a productive advisory relationship but there are other options that people need to be aware of. Using a fee-only advisor would be one way to help reduce the conflicts of interest. Once someone’s already decided to work with an advisor, going fee-only just means fewer conflicts sitting between you and the advice — which makes for a more collaborative relationship, since the advisor isn’t weighing what to recommend against what pays them best.

I think the big challenges are:

• Understanding what to do about taxes. If you’ve got a significant pension and significant retirement savings, determining what the best tax planning strategy is going to be is going to be big. That gets more complicated for anyone whose pension is split across a frozen final-average-earnings formula and a newer cash balance formula, since each piece can call for a different strategy.
• Right alongside that is a retirement spending problem. Understanding, after years of saving and investments, how much they can spend is, oftentimes for people that have been frugal their whole life and are really good savers, one of the most difficult challenges. Trying to rewire their saver brain into a retirement spender brain can be helped by having a financial planner to help you understand what is realistically safe, using probabilities, history, and math. That can be really helpful in making that shift and that change when you are in retirement and also knowing when you are ready to retire can be a big shift. It can be scary going from a paycheck and all that career success and recognition to then being able to have your freedom but also having to rely on your portfolio and using a system. What a financial planner can provide can help you have a lot of confidence in the income machine that you guys build together, based on your portfolio and all your different resources and tools.
• For people mid-career, just maximizing their company benefits, maximizing their savings opportunities and investment opportunities to set themselves up and their families up for their most cherished life objectives. Saving time in doing that and helping clients just really understand thoroughly what opportunities are available and which ones are uniquely suited to them (so they can really make the most of their efforts and their career and have that translate well into their financial world)

They’re going to want to ask:

• Have they worked with Raytheon employees before?
• How do they get paid? Do they have compensation from third parties or do they only get paid by clients?
• What are the fees based on? Is it based on hours worked or something else? I guess it’s under management.
• What’s the process for choosing to work with an advisor and identifying if there’s a mutual fit?
• Is there consultation involved?
• Are there any education materials that you provide to help understand what they’ll get and what a typical client experience might look like (whether that be a sample plan, videos, or something along those lines)? To help the potential client evaluate if the client does have the expertise and merit that might closely align with what their needs are.
• What are the credentials and licenses of the advisor? Are they CFP?

Oftentimes something that surprises me in my first meeting with Raytheon employees is that they’re just not fully aware of what options they have with financial advisors or planners.

A lot of them have been doing things on their own, working really hard, saving into their 401(k), and doing a great job financially but not fully understanding the scope of the options they have. They do not understand how things might be able to be configured with their finances and how all their cash is going into different places that might be more beneficial for their scenario.

I will say that I’m a little biased because I am a financial planner but frequently I do find there are opportunities to provide some adjustments or tweaks to help people get in more alignment with where they’re at.

Separately it’s worth saying not all financial advisors or financial planners are going to be high quality. There are a lot of insurance salespeople that kind of brand themselves as financial advisors. That’s an additional thing that I oftentimes encounter when someone believes that they’re working with a financial advisor but they’re really just putting money into an insurance policy. They really haven’t taken the time to reevaluate things from an objective financial standpoint because their financial advisor, who they believe they’re getting objective input from, is really an insurance sales representative or works for an insurance company. 

Yeah this is one area where I really specialize in helping people. I’ve worked with some really high-level executives. Sometimes there’s significant stock compensation that applies. Executives may have the option to elect a portion of their stock compensation to be received as stock appreciation rights, which is a high-leverage option for them to potentially experience significant upside with business. However there’s a lot of risk associated with that so each person’s going to have a unique situation where it may or may not make sense for them.

Separately there’s a deferred compensation plan for employees with over $360,000 (will adjust higher in years after 2026) in includable compensation that allows employees to contribute extra to the deferred compensation plan and not miss a full company match on their retirement contributions (just because the IRS has an includible compensation limit). That is pretty much a no-brainer for a lot of people to at least do the excess compensation contribution to the deferred compensation plan so they don’t miss out on any matching contributions on their salary from a percentage standpoint.

The extra use of the deferred compensation plan or other more advanced benefits can be pretty tricky to determine. It really depends on where you’re at in terms of your career, how close you are to retirement, what your goals and objectives are, and how much extra cash you may need in the short term for your personal objectives (whether you have a kid going to college, plan to buy a second home, or have other aspirations to renovate part of your house). All of these things might require a lot of additional cash and so how much you use some of these benefits should really fit into the broader profile of your financial plan and goals.

One of my clients is an executive at Raytheon and as he’s been getting closer to retirement, we have been able to use the deferred compensation plan more precisely with the rest of his goals and in the broader tax planning strategy. 

 He also is a charitably inclined individual so we were able to come up with a pretty unique financial strategy that includes:

• bunching his charitable contributions in one year with a donor-advised fund
• alternating that with years that he’s contributing to the deferred compensation plan, with specific distribution years aligned to his retirement goals

As a highly compensated individual this is great because he’s able to use his tax deduction opportunities a little bit more precisely than he would have probably come up with on his own. This is not because he is not smart enough, but because he has a family and kids, and everyone knows how hard they work you when you get to the higher levels at the company. 

Altogether, we believe it’s going to help him to save a significant amount of taxes because a lot of this is going to come out when he is in retirement and is in a much lower tax bracket.

Well, it really depends on where you were before 2020. If you were a Raytheon employee prior to 2020 and you have some legacy benefits for hires pre-2007, Your pension moved from a defined benefit plan to a cash balance plan during the merger.

Separately for United Technologies employees that were part of the merger in 2020, if they were hired before 2010, they may have a pension plan that got phased out in the merger as well. 

One thing that people should really be thinking about is what the impact is on their retirement plan of that change. It means they’re going to be getting less salary replacement from that because the defined benefit plan is not going to continue and the cash balance plan is a little bit less lucrative. That might mean that if they haven’t really updated their plan in a long time, they may need to review what their target savings need to be, considering all of their income sources and what the projected cash balance plan will contribute to their retirement.  

Another big piece of planning for employees post merger, especially if they’ve been there for a number of years, is employer stock in the 401(k). Depending on how long you’ve had that stock, that stock may have gone through a couple of changes and may have a low basis. This may introduce an opportunity for NUA, or net unrealized appreciation. This is an important tax planning tool that may apply when you do retire, it applies to employer stock in the 401(k), it would allow for really favorable tax treatment on that if the procedure is done properly when making those changes. 

However it’s important to note that carrying a significant amount of employer stock in your 401(k) could be a big trap as well. I would advise evaluating it in the context of a broader financial plan and determining what exactly the tax benefits would be. I would determine if management of that position, in light of the tax benefits, may still be a better proactive move for your retirement plan. 

While some benefits may be phasing out or coming in, oftentimes what might seem small can really be a significant factor in your long-term plan. It may even introduce new opportunities for you to contribute more, get a better match on your retirement plan.

There is oftentimes a really great translation of skills and experience across different defense industry companies. The big thing would just be from a location standpoint: defense contractors employees are oftentimes limited to being on site at least a few days a week. Some employees are exempt, but we’ve seen, over the past couple years, return-to-office mandates for Raytheon employees become stronger and the key is factoring this location requirement into the broader financial plan. If someone’s planning to step back and maybe have a second act in early retirement, if it’s going to be in the defense contracting industry, that may still be location-dependent. That, in turn, does materialize in different state tax considerations and a variety of other pieces: cost of living, real estate costs, what to do with existing homes, and so forth. 

Additionally, I have seen some people come frequently from the military into Raytheon. That’s an extremely common thing. Combining previous government or military benefits with the Raytheon retirement package is a type of planning that requires a little bit more advanced knowledge of some of those pensions or VA benefits. Those can be extremely valuable in a financial plan and a retirement plan but if overlooked can be costly. 

Yeah I really would think that the company’s defined benefit pension plan is a great benefit that puts you ahead of most other employees savings for the future in today’s workforce, and also embeds a conservative income stream into your overall financial plan separate from social security. However, for most Raytheon employees, it’s not going to fully replace the need to save into 401(k) because the benefits started to phase out in 2020 — with most people’s actual accruals frozen by the end of 2022 — and so oftentimes there’s going to be a gap.

The key is just understanding what your goals are in terms of your ideal lifestyle and then backing into what’s going to be the best set of tools and contributions that’s going to achieve your objectives. The savings gap you need to cover in your 401(k) may be very small if your lifestyle objectives are modest, but it could be larger if you were in the pension for a shorter period of time, and have greater lifestyle aspirations.

The rule of thumb thinking around how much you need to save in the 401(k) is where a lot of people get tripped up. Knowing your math and numbers is a unique and personal things, and getting it right can give you confidence in your financial plan, and help become more free of just chasing what every one else is doing when that may not be right for you.

For Raytheon employees that are receiving stock and equity compensation, the stock has done exceptionally well over the years and understanding the concentration risk can be challenging when all they can remember is positive performance. 

I think one key is reminding them exactly how much upside they still have to participate in the stock with unvested shares and determining whether people are a little bit more driven to capture the potential rewards of that concentration. Reminding them that maybe the best way to do that might not be with stock share grants. Maybe it might be holding positions in a 401(k), which can benefit from advanced tax treatment like NUA, and managing the current positions that become vested as cash. 

However it’s not a one-size-fits-all type strategy. Understanding the importance of diversification, I think, to some degree or another, is going to be essential to any well-grounded financial strategy. There are a lot of considerations. If someone is already completely funded in their plan or on track to be funded, maybe they have a higher risk tolerance and more ability to take risk (because it might not threaten their future and their goals as much as it would someone who really is behind on their retirement plan and is trying to catch up by having all company stock in their portfolio). 

Tax considerations can be a part of the picture too for employees that we meet. Sometimes they have had positions that they just haven’t got around to selling and doing that thoughtfully. From a tax standpoint that introduces the possibility to discuss a lot of other solutions: maybe more elegant tools to diversify that tax position or maybe it’s just diversifying that tax position over a number of tax years (depending on where their income brackets are falling and a variety of other things). 

But the key is that, while the stock’s done well and hopefully it continues to do well, we don’t know what the future holds. And at the core it’s just that, as opposed to you making a deal, right? You are choosing to not get killed by one thing happening and in exchange you’re not going to make a killing with one thing going well, right? A lot of the employees at Enron or Polaroid had no idea what was going on. With a very complicated organization there can be risks that you just don’t really have knowledge of or can’t really foresee.