For participants and beneficiaries currently receiving pension benefits there is no action needed. Your benefits will continue during the transition process. After the transition process is complete, the insurance carrier will automatically continue your payments without disruption.
During the plan termination process, most current or former employees not currently receiving pension benefits will be eligible to elect either an immediate lump sum payment or an immediate annuity payment during a one-time special election window expected to take place in the Spring or Summer of 2026.
Participants with pending divorces, pending Qualified Domestic Relations Orders (QDRO), alternate payees with QDRO separate interest designations, and those above the required minimum distribution age will not be eligible for the special election window.
If you elect an immediate lump sum during the window, you can roll those funds into an eligible retirement plan, such as the Baker Hughes Company 401(k) Plan or an IRA, or take a cash payment. You may instead choose to receive your monthly pension payment as an immediate annuity during the window.
After the window, the eligibility requirements to begin receiving your benefit and the payment options that currently exist under the Plan will continue.
You will only be able to take a distribution after you have terminated employment with Baker Hughes and you satisfy applicable age requirements. In other words, the only opportunity you have to take your plan benefit while employed is during the one-time special election window.
For current or former employees entitled to a Cash Balance benefit and not currently receiving pension benefits, the termination of the Plan will impact the interest credited to your Cash Balance benefit.
Your Cash Balance benefit is being increased by an “interest credit” each quarter based on current interest rates and has been subject to change each year (though never less than 2.60%). The interest crediting rate in 2025 through the termination date of July 1, 2025 is 4.15%.
For annual periods after the proposed termination date, in connection with the termination of the Plan and as required by the Internal Revenue Service, the interest crediting rate will be permanently set at 3.20%. The rate will no longer change from year-to-year. This rate of 3.20% will apply until you commence your benefit.
When you decide to take your Cash Balance benefit, you have the option to receive the balance as a lump sum or you can convert this balance to an annuity. If you take an annuity on or prior to July 1, 2025, the annuity conversion rate of 4.15% will be used to determine the amount payable as a single life annuityIf you take an annuity after July 1, 2025, the annuity conversion rate of 3.20% will be used to determine the annuity amount payable as a single life annuity.