TL;DR: Honeywell’s retirement plan can help employees in their later years, but rising costs of living might dictate the need for additional retirement income.
Main points:
- Pension Plan: Guaranteed income for long-tenured employees; based on salary and service but may not keep pace with inflation.
- 401(k) Plan: Tax-advantaged savings with employer match; includes investment options and catch-up contributions.
- Healthcare & Benefits: COBRA, HSA, life insurance conversion, and more—but could potentially change.
- Key Consideration: Rising costs and longevity may require supplemental savings beyond Honeywell plans.
Planning for retirement takes more than just signing up for a company-sponsored plan. If you're a current or former Honeywell employee, you might be relying on the Honeywell retirement plan to carry you through your later years. But with rising healthcare costs, longer life expectancy, and inflation, many retirees are asking the same question: is that plan really enough for you?
Honeywell offers a mix of benefits. Taking a closer look now can help you avoid surprises later and set you up for a more secure future.
What the Honeywell Pension Plan Offers
The Honeywell pension plan follows a defined benefit model, which means it provides guaranteed monthly payments in retirement based on your salary and years of service. This type of plan can offer reliable income, especially for long-tenured employees who were hired before Honeywell shifted focus toward defined contribution plans.
Payouts are typically calculated using a formula tied to your highest average earnings over a certain number of years, combined with your total years of service. If you qualify, the pension can be a strong base of retirement income.
However, there are limitations to Honeywell’s pension plan. If you didn’t work at Honeywell long enough to become vested, you might not receive the full benefit. And even for vested employees, the fixed income may not keep pace with inflation or rising living costs. Even executives might need a supplemental retirement plan.
What the Honeywell 401k Plan Offers
The Honeywell 401k savings plan offers employees a flexible way to save for retirement, combining tax advantages with employer contributions. Here’s how Honeywell's 401k plan works:
- Contribution Options: Employees can contribute up to 30% of their eligible pay through pretax, Roth 401k, or after-tax contributions, subject to IRS and plan limits.
- Contribution Limits for 2025:
- The IRS limits combined pretax and Roth contributions to $23,500.
- Employees aged 50 or older can make an extra catch-up contribution of $7,500, bringing their total to $31,000.
- After-tax contributions, including employer matching, has a cap at $70,000.
- Employer Matching: Honeywell matches 87.5% of the first 8% of eligible pay that an employee contributes, up to 7% of base salary. For the annual match, employees must contribute and remain actively employed through December 15 of that year.
- Vesting: Employees are always 100% vested in their own contributions. Employer matching contributions vest after three years of service.
- Investment Options:
- Target Date Funds: These funds automatically adjust their asset mix as you approach your chosen retirement year, suitable for those preferring a hands-off approach.
- Core Funds: A selection of 10 funds for those who wish to actively manage their asset allocation.
- Managing Your Account: Fidelity administers this plan i. Employees can manage contributions, investment choices, and access different tools and resources through Fidelity's platform.
Even if there are gaps in your Honeywell 401k plan, you can find another way to add additional retirement income, like a Roth IRA.
Getting to Know Your Honeywell Retiree Benefits
Healthcare costs can significantly impact your retirement budget, especially as you age. Honeywell has retiree benefits that help cover some of these expenses, but it's important to understand what's included.
With your Honeywell retirement plan, you can keep your existing health plan for up to 18 months through COBRA, but you’ll pay the full premium cost. You can also look into other options on the Health Insurance Marketplace, which may offer more affordable or suitable plans. Eligibility and coverage options can vary depending on your hire date, years of service, and retirement status.
It's also worth noting that Honeywell’s retiree health benefits are not guaranteed to remain the same. Employers can adjust or discontinue offerings based on cost or policy changes.
Beyond medical coverage, Honeywell’s retirement plan provides various resources to assist retirees:
- Health Savings Account (HSA): You can continue to use the funds for qualified medical expenses in retirement.
- Life Insurance Conversion: You have 31 days from your last day of employment to convert your Honeywell life insurance coverage to an individual policy.
- Legal Assistance: You have 30 days from your last day of employment to convert your legal assistance coverage to an individual policy
- Alumni Hub: You can access post-employment information, payroll documents, job openings, Honeywell news, and HR support.
Is It Enough? Evaluating Your Retirement Readiness
Even with a Honeywell retirement plan, pension, 401k, and healthcare benefits, many retirees wonder if it will all be enough. The answer depends on several personal factors.
You should start by considering:
- Your expected lifestyle: Do you plan to travel, move, or help family financially?
- Your health outlook: Chronic conditions or anticipated medical needs can increase costs
- Your total savings: Outside of Honeywell’s plans, do you have other assets or income streams?
- Your lifespan: People are living longer, which means your savings may need to stretch further
- Your tax situation: What is your current tax bracket now and will it change when you retire? How will withdrawals and your retirement income affect that?
- Your beneficiaries: If your wealth outlives you, who will receive it?
- Your Social Security: How does your current retirement income sources affect your Social Security benefits?
Relying only on employer-sponsored benefits could leave gaps. For example:
- Pension income may not adjust for inflation
- The Honeywell 401k savings plan depends heavily on market performance
- Healthcare benefits may not cover long-term care or all prescriptions
Evaluating your readiness means running realistic numbers. Compare your expected income (e.g. pension, 401k, Social Security) against your likely expenses (e.g. housing, healthcare, daily costs).
If there’s a shortfall, now’s the time to address it.
Ready for Retirement—or Just Hoping for the Best?
The Honeywell retirement plan gives you a strong starting point, especially when it includes a pension, 401k savings, and retiree health benefits. But depending solely on employer-provided benefits may leave you underprepared for rising costs and longer lifespans.
Review what you currently have, understand what’s missing, and take steps to build a more complete retirement strategy. A clear plan gives you confidence—and options.
Get your free portfolio review today!
Stewart Willis is the founder and president of Asset Preservation Wealth & Tax, a financial planning firm in Phoenix, Arizona. Investment advisory services offered through Foundations Investment Advisors, LLC, an SEC registered investment adviser.
The commentary on this blog reflects the personal opinions, viewpoints and analyses of the author, Stewart Willis, providing such comments, and should not be regarded as a description of advisory services provided by Foundations Investment Advisors, LLC (“Foundations”), an SEC registered investment adviser or performance returns of any Foundations client. The views reflected in the commentary are subject to change at any time without notice. Nothing on this website constitutes investment, legal or tax advice, performance data or any recommendation that any particular security, portfolio of securities, transaction or investment strategy is suitable for any specific person. Personal investment advice can only be rendered after the engagement of Foundations for services, execution of required documentation, including receipt of required disclosures. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Foundations manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Any statistical data or information obtained from or prepared by third party sources that Foundations deems reliable but in no way does Foundations guarantee the accuracy or completeness. Investments in securities involve the risk of loss. Any past performance is no guarantee of future results. Advisory services are only offered to clients or prospective clients where Foundations and its advisors are properly licensed or exempted. For more information, please go to https://adviserinfo.sec.gov and search by our firm name or by our CRD # 175083.
