Retiring from Vanguard
Vanguard provides several benefits to eligible crew members who qualify as Retirees when they leave Vanguard.
This summary is only a brief description of the benefits provided under The Vanguard Group, Inc. Benefit Plan for Retirees (the "Retiree Plan") and the Vanguard Retirement and Savings Plan (“RSP”). For complete information, crew members and Retirees should consult the Summary Plan Descriptions (SPDs) for the Retiree Plan and the RSP as well as other governing plan documents. In the event that there are any discrepancies between the applicable SPD or plan document and this summary, the SPDs and/or plan documents are controlling.
The Retiree benefits described below, other than access to Vanguard health coverage prior to eligibility for Medicare and prior to age 65 , the Vanguard Retirement and Savings Plan (RSP), Partnership, and the retirement gift, are only available to crew members hired (or most recently rehired) before January 1, 2020.
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Crew members will be considered Retirees if at termination of employment they are at least age 50 and have at least 10 years of service, and their age plus service total at least 65. Years of service are 12 month periods in which a crew member works at least 1,000 hours, measured from their hire (or most recent rehire) date. See the Retiree Plan SPD for details on how eligibility service is calculated.
Retiree Medical Account
Crew members hired (or most recently rehired) before January 1, 2020 who qualify as Retirees when they leave Vanguard will be credited with an unfunded Retiree Medical Account, or RMA, that can be used for reimbursement of up to 75% of eligible after-tax health care premiums. Starting in the year the crew member attains age 40 or is hired, whichever is later, the crew member will be credited with $5,500 towards their RMA balance for each year of service they are also credited with at least 1,000 hours of service. After leaving Vanguard, the RMA will be credited with $1,000 annually. Rehired crew members may have a different start date for this calculation. See the Retiree Plan SPD for details on how credited service and rehire dates are calculated. Any unused RMA balance is forfeited upon the death of the Retiree.
If married when leaving Vanguard, the Retiree's eligible spouse will receive a spousal RMA with a starting balance equivalent to 50% of the Retiree's RMA balance. A spouse who is an active crew member or a Vanguard Retiree will not be eligible for this spousal RMA, nor are domestic partners eligible for a spousal RMA. If a Retiree marries after retirement, a spousal RMA will be established at the time of marriage, equal to 50% of the Retiree's RMA balance on the date of marriage. Any unused spousal RMA balance is forfeited upon divorce or the death of the spouse.
Retiree and spousal RMA accounts may be used interchangeably, and may be used to cover the eligible health care expenses of other eligible dependents, such as dependent children or domestic partners.
Crew members hired (or most recently rehired) before January 1, 2020 who qualify as a Retiree when they leave Vanguard and elect COBRA coverage for continuation of health care benefits for themselves and/or their eligible dependents after retirement will receive a subsidy from Vanguard to cover 100% of costs for the first three months of COBRA coverage. This subsidy is not taxable to the Retiree. The Retiree is responsible for the full cost of COBRA coverage after the subsidy period ends.
Continued Access to Health Coverage
All Crew members (regardless of their hire or most recent rehire date) who qualify as Vanguard Retirees when they leave Vanguard and who have not become eligible for Medicare or reached age 65, have access to and may enroll themselves (and their eligible dependents, if applicable) for health coverage including prescription drug, dental, and vision, under Vanguard's Retiree health benefits. Enrollees will pay the full cost of this coverage on an after-tax basis. See the Retiree Plan SPD for more information.
Crew members hired (or most recently rehired) before January 1, 2020 who qualify as a Retiree when they leave Vanguard will receive a $10,000 life insurance policy through Vanguard's group plan. Retirees can change their beneficiary designation at any time as long as Vanguard receives [it][the beneficiary designation] prior to death.
Crew members hired (or most recently rehired) before January 1, 2020 who qualify as Retirees when they leave Vanguard will receive a payment equal to their full PTO benefit for the retirement year in addition to any accrued, unused time to which they are entitled upon termination under the terms of the Vanguard Paid Time Off Policy in effect on the date the crew member leaves Vanguard.
Retirement and Savings Plan (RSP)
Active participation in the RSP ends on the crew member's last day of employment. All Retirees (regardless of their hire or most recent rehire date) will receive a final Retirement Plan contribution for the quarter that includes the crew member's final eligible pay, including any RSP eligible bonuses paid before or after leaving Vanguard as a Retiree. The Retiree may be eligible to receive a match true up when that contribution is made (generally during the first quarter of the following calendar year.) See the Retirement and Savings Plan SPD for details on this plan.
All crew members (regardless of their hire or most recent rehire date) who qualify as Retirees will receive a gift as a token of Vanguard's appreciation and recognition of their service, as well as a letter from our CEO Tim Buckley.
All crew members (regardless of their hire or most recent rehire date) who qualify as Retirees when they leave Vanguard, will also qualify as a Retiree for Partnership purposes and will receive a final Partnership payment as described below.
Crew members who retire between January 1 and the June Partnership payment date will receive both the previous year's Partnership payment and a prorated current year Partnership payment in June. Crew members who retire after the June Partnership payment date through December 31 will receive a prorated current year Partnership payment for the time worked in the current year at retirement, shortly after retirement. Regardless of a crew member's retirement date, the Partnership payment will be determined using the multiplier announced in June of the year of retirement.
Administration and Amendment
The Vanguard Group, Inc. Benefits Committee is responsible for the overall administration and interpretation of The Vanguard Group, Inc. Benefit Plan for Retirees (the Retiree Plan), the Vanguard RSP, and other benefits provided to eligible Retirees.
As with all benefits provided under Vanguard's benefit and compensation plans, Vanguard reserves the right to amend, modify, or terminate benefits and compensation plans provided to eligible crew members and Retirees and/or their beneficiaries at any time. No consent of any participant or beneficiary is required for Vanguard to exercise its right to do so.