Chevron Lump Sum Segment Rate Summary - April 2025

This monthly newsletter aims to track the interest rates that calculate the lump sum in the Chevron Retirement Plan and give an estimate of how it might affect your retirement benefit.

April Segment Rate Summary

The segment rates for April are 4.51%, 5.49%, and 6.07%. This brings the three-month average to 4.63%, 5.42%, and 5.86% for a July 2025 benefit start date. For Chevron employees hired before 2008, we estimate the lump sum benefit to increase about 0.10% for an average vested 65-year-old in July versus June, though please check your benefit calculator for your actual calculation.

All three segment rates increased over March by varying degrees. Despite this, the lump sum is still expected to increase slightly in July because the January rates that fell out of the three-month average are higher than the new April rates entering the calculation. The “front-heavy” rate pattern discussed last month is no more, meaning that future lump sums will be more sensitive to rate changes. 

To read more about how to spot patterns in the segment rates to predict movement in the lump sum, including back-heavy and front-heavy patterns, please visit the updated link below.

Front and Back-Heavy Rate Patterns

How Does this Affect Me?

The Chevron Retirement Plan offers a substantial benefit to Chevron employees over many other companies’ plans. It is one of the few remaining retirement pension plans that still offers a lump sum benefit. Since the Pension Protection Act of 2006, the calculation of the lump sum has become more complicated now relying on corporate bond yield curves, known as segment rates, instead of the 30-year treasury rate that was used in the past. In a low interest rate environment, it is important for Chevron employees to understand how their lump sum is calculated and how quickly the benefit can change.As interest rates lower, the lump sum increases, and vice-versa. If rates increase 1% across the board, it could lower your lump sum by almost 10% depending on your age and length of service.  This calculation applies only to Chevron employees hired before January 1, 2008.

Baird Retirement Management provides highly specialized retirement planning expertise for business professionals nearing retirement. Our perspectives are backed by our extensive experience, comprehensive industry knowledge and immersion in the latest retirement, income, and tax planning strategies. By focusing on select companies and industries, we can tailor our retirement planning advice to help meet the specialized planning needs and considerations of employees within a company or industry.

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The PL Group from Baird Retirement Management has not been hired by Chevron and is not affiliated with Chevron in any fashion. Certified Financial Planner Board of Standards Inc. owns the certification marks CFP^®, CERTIFIED FINANCIAL PLANNER™ and federally registered in the U.S., which it awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirement. Robert W. Baird & Co. Incorporated. 777 East Wisconsin Avenue, Milwaukee, WI 53202. JG2025-0602
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