Today’s Mail Brought Me an Unexpected Financial Windfall!

Today started like any ordinary day around here. Had my breakfast, watched a little CNN, checked out my emails, and played a bit of free online slots. It was a typical Monday morning here in exciting retirement land. Yeah, real exciting, huh? Well, nothing like a financial windfall to add a little pizzazz to your day!

I am thrilled to receive an unexpected financial windfall, but I should have known it was coming. Make sure you know what your retirement situation will be.

I am a creature of habit these days and although there are a few surprises here and there that do happen, what happened today was totally unexpected! I am still pinching myself and I am overwhelmed. Today’s mail brought an amazing letter from one of my former employers, R.H. Macy.

R.H. Macy Gave Me My Start

I worked for Macy’s under several different parent corporate names over a 19 year run, in the 70’s, 80’s and 90’s when it became Federated Stores which it remains today. Seems like eons ago, but I have to admit my days as an executive trainee working there after college laid the foundation for all of my knowledge over the years as a retailer.

I think I always felt that Macy’s was like a relative of mine who gave me my first break in the business world and that I owed them something in the way of gratitude and loyalty. I think that feeling is very common to many people who get their first good job and get the opportunity to shine. That was me, at age 23 at Macy’s.

New Jobs Mean Tons of Paperwork

I’m sure you have had the experience of beginning a new job and going through the routine of filling out all of the required documents from payroll information to benefits for things like health insurance and retirement plans, among others. I did that too and as a young, inexperienced kid I didn’t really understand some of it, but I signed all the papers and never really looked back.

One of Those Papers Was About the Macy Pension Plan

Frankly, I did get a few memos here and there over the years about things like vesting, and distribution changes and options, but I really didn’t think a lot about any of it since I was so very far away from retirement back then and I wasn’t putting any of my own money into the pension plan. It was fully funded by the company. I was much more aware of the 401(k) plan and the ESPP (Employee Stock Purchase Plan) that I was investing in from each payroll check and honestly just forgot about the pension.

All Good Things Come to an End

In the early 90’s, I left Macy’s and started a new career in specialty retailing. I was very excited to get an opportunity to run an 11-store retail chain as the COO. Again, lots of paperwork and I signed them all and took my Macy’s 401(k) with me along with a cash-out on my Macy’s stock. Looking back, that probably wasn’t a great decision but I did it and I invested the money in some of the new tech stocks like AOL. I gave absolutely no thought to the pension plan since I was still 25+ years from retirement.

As TV’s Gomer Pyle once said, “Surprise, Surprise, Surprise

Today, I strolled down to the mailbox as I usually do each afternoon around 4 pm and to my surprise, I found a huge envelope from Macy’s with the header: “Important Retirement Benefit Information”.

My first thought was, “How the heck does Macy’s know where I live?” I hadn’t worked there in 25 years so what could this be all about?

Inside the house, I carefully opened up the 30-something pages stapled together and read and then reread the following: “This letter is to inform you of your benefits under the R.H. Macy Inc. Pension Plan”.

It seems that my pension, something that I had totally forgotten about, was now to begin paying me since I had reached full retirement age (FRA). I had to read it four times before I believed it!

It had tons of gobbledygook in the letter, but the bottom line is this: once I make a selection from the payable options (it’s payable as an annuity), the payments will begin and can last for decades or longer. The amount of the payments is subject to the terms I select but will be somewhere around $500 a month and that literally is like money falling from the sky for my wife and me.

Interestingly enough, I have actually found an error in my Macy’s payout plan which should have begun back in 2015 when I reached age 66, my full retirement age (FRA). Check your FRA at the Social Security website. Macy’s actually now owes me back benefits for 27 months (ka-CHING!!!) that should come to me even before my first monthly check does.

The Moral to the Story

I thought I was so smart and completely on top of all of my money, where it comes from and where it goes, etc. I completely forgot about my pension and in fact it should have been right in the forefront of my retirement planning.

The lesson here for all is to make sure you know what benefits you have now and what you may have left behind somewhere you have previously worked. Although I am thrilled to get this financial windfall, I will now have to rethink all of the planned use of my retirement funds and my potential tax liabilities that will result. I know that sounds like I am being a bit ungrateful, I’m not. I am just saying that I really should have known about all of it and planned accordingly. But you’re never too late to learn.

The other moral to this story is to use financial windfalls wisely. I’m planning to pay off the debt we have (dental expenses from earlier this year, the final few car payments, and extra payments on our mortgage), use some of the money to pad our emergency fund, increase our charitable giving, and generally not go out and spend it all. Any time you get a financial windfall, whether it’s a raise or some other monetary gain, make sure it goes to your goals and doesn’t get lost in a spending frenzy.

Are you on top of your retirement planning and have you kept good records on any benefits you may be getting when you reach FRA? What do you think about my good fortune? How would you spend it?


  1. Emily @ JohnJaneDoe

    Congrats, Gary!

    Your posts have indicated a little stress lately (maybe I’m reading more between the lines than is there.) I hope this helps take some of the edge off. An extra $500 a month can do a lot to pay debt, pad an emergency fund, and help absorb some rising costs.

    And yeah, you’ll have to do a few estimated payments probably or arrange for some tax withholdings on the pension payments. But even after taxes you should have a nice income bump.

    1. Thanks, Emily, for the good wishes. I may be showing a little bit of stress these days, but I hope it’s not bringing anybody down…that’s not my intention. In retirement, with so much time on my hands, I guess there are days when I’m worrying instead of relaxing, which is what retirement should be. In any event, getting this news about the pension has put a smile on my face!

      1. Emily @ JohnJaneDoe

        No, you weren’t bringing anyone down, Gary. I appreciate your perspective, and I think a lot of the concerns you’ve been bringing up really resonate for retirees and those approaching retirement. But I had noticed something in your comments and posts that made me think you could use a few rays of sunshine for a change. Glad one found you.

    1. I haven’t worked out a new budget for 2018 yet, although I am working on it. My guess is that some of it will just go for the increased cost of living and medical, but hopefully this year having that extra income will allow us to at least take a vacation which we haven’t done since 2015. That’s something that we are both looking forward to doing.

  2. Prudence Debtfree

    Woooooo-hoo! That is GREAT news, Gary! And it’s a gift that will keep on giving – not just a one-time windfall. This should give you a nice, plush, financial cushion to add more peace and stability overall. It’s so great when these good things happen to humble people who are truly grateful for them and will use them well – like you : )

  3. Woo-hoo! Way to go Gary! $6,000 a year plus back pay can really make a difference. I’m with you on not going crazy with a windfall but I’m also glad to hear you’ll spend some of it on a vacation.

    I wouldn’t be too hard on myself for forgetting about the pension. I know I can’t be on top of everything all the time. Anyway, I’d rather forget something good that comes unexpectedly, than count on something good that never happens. How’s that for logic?

  4. Congrats Gary, that’s fantastic news, I’m very happy for you! $500\mtg is significant on any budget. Isn’t it amazing that it came out of the woodwork after all those years. I can see how it would have been easily overlooked as well, considering it was employer funded.

    1. Thank you for your good wishes, MMM. I’m still kind of pinching myself and yes, it will make a huge impact on our budget immediately. I’m certainly glad Macy’s remembered about it, because I didn’t. I would hate to think it was totally up to me to tell them. And by the way, they have been really nice to me in the last 48 hours in providing additional information about my options.

    1. Well, RAnn, the decision was easily made between lump sum and annuity simply because I did not have the option of accepting a lump sum. It seems that the rules of this pension were if your total value was above $5,000, you must choose one of five annuity options, ranging from a payment to me for life up to taking a reduced payment and a percentage would go to my beneficiary/spouse for life (after my passing). I may write something about how I made the choice among the five. Perhaps others are interested too. Thanks for your good wishes.

  5. Wow! Congrats, Gary. I’m glad they followed through on their end. I wonder if they’ve had trouble finding you and that’s why it’s late getting to you? Either way, cha-ching is right!

    My Hubby always counts his pension in our retirement plan. I’m afraid to do so, because we are only in our late 30s and I worry that they’ll renege that offer before we reach retirement age. As we get closer to retirement, we’ll definitely have to keep it in mind!

    1. It’s very interesting, Jamie, about what they told me regarding contacting me at this point. They frankly admitted that they were very “unaggressive” about contacting pensioners and were waiting for the pensioners to contact them. Somehow they reversed course fairly recently (possibly due to some legal commitment?) and that’s why I got this letter. Truthfully, if they hadn’t reached me, I’d probably never have known.

  6. Claudia @ Two Cup House

    Kudos to you! I’m so happy for you and your wife! This is so awesome. We haven’t done a great job of keeping track of the pension from Garrett’s former employer, so we’ll have to check into this…

  7. Hey Gary, excellent post here …
    I have to be honest you, last time I checked anything that has to do with pension … was at least 2 years ago …

    This article opened my eyes, I will have to go and check what happened in all this time and make sure everything is under control … I still have a lot before I retire, but it’s better to put things on track early so I don’t have any surprise later on … I hate surprises :))

    Thanks for sharing!

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