401k Consulting

Refinery Retirement is dedicated to providing you with the most current information on your BP Employee Savings Plan (ESP).  While most employees assume it’s just a basic 401(k), it’s actually much more.  BP’s ESP is one of the most competitive retirement savings plans in the industry and if funded properly can allow you 300% higher funding options than a traditional 401(k) Plan.

ESP/401k

Refinery Retirement offers generic asset allocation models to assist you with how you may want to structure your investments inside your BP ESP.  If you would like to receive these updates as they are released please sign up for our newsletter.

Your BP ESP is designed as a suite of retirement options aimed at giving you the highest IRS allowed contribution levels.  A common misconception is that employees are only able to contribute a maximum of $19,000 in 2019 ($25,000 if you are over 50) but in reality, you can contribute up to $56,000 ($62,000 if you are over 50).  The difference between these figures is what’s deductible and what’s not deductible.  Your ESP allows you to make “After-Tax” contributions in excess of the regular 401(k) funding limits which allows you to save even more than most plans for retirement.  If you are someone who overfunds your 401(k) plan there are several special options available for you.  These options range widely but generally will allow you significant long-term tax benefits above and beyond what is normally provided. Because every individual employee’s situation is unique it’s important you consult with a financial professional who specializes in knowing the details of your plan. For assistance, visit our Contact page.

Another common misconception BP Employees have is once you hit the contribution limit, BP will stop matching the 7%.  In reality they will continue to match your account as long as you keep your contribution percentage above 7% regardless of whether you have reached the limit or not.  Even if you hit the upper limit of $56,000 ($62,000 for over 50), they will still continue to match you through an account known as the “Excess Benefits Plan”.  This plan is only available to you once you have reached the upper ESP funding limit and allows for special distribution options that are significantly different from the normal ESP rules.  Please consult with one of our professionals if you are enrolled in the Excess Benefits Plan.

Target Date Funds:

Refinery Retirement currently does not recommend investing in the Target Date Funds offered inside the plan due to several issues relating to the lack of public disclosure for these funds.