ATTN BP Employees,

Updated interest rates that impact your BP Pension (BP RAP) have been released. For a clear understanding of these changing rates, please find attached our interest rate chart detailing the current interest rates influencing your BP RAP and our predictions for where they may head in the future.

What You Need to Know:

  1. Interest Rates used to calculate your BP RAP pension dropped significantly last month, as expected. We anticipate rates impacting your BP RAP to be a mixed bag next month with some moving higher and others moving slightly lower. These fluctuations should ultimately lead to a minimal overall change versus current levels this coming month.
  2. What Does this Mean for You? With rates remaining lower, this could have a positive impact on your lump-sum value. We strongly encourage you to contact us to discuss the impact these rates could have on your BP RAP and your overall retirement goals. We can help you understand the best option for your long-term retirement planning needs.
  3. Why are the Rates Changing? Interest Rates have been largely influenced by the Federal Reserve’s position regarding the future direction of interest rates. Current expectations are that the Fed will keep rates where they are at, for now, with the possibility of rate cuts starting in the coming months. Where the Fed goes from here is largely dependent on what happens in our economy.  If Gross Domestic Product (GDP) in the US continues to show modest growth, then we should expect that rates will stay at current levels for the foreseeable future, but if we end up seeing signs that the economy is cooling off, then we would expect to see the Fed begin cutting rates.
  4. What’s Next? The Fed concluded its most recent interest rate policy meeting on January 31st, where it decided to leave current interest rates unchanged. In the press conference following the meeting, Fed Chair, Jerome Powell once again hinted at the possibility of the Fed lowering interest rates at future meetings.  He did not state when the expected rate cuts would begin but did say that the Committee was not likely to begin cutting rates at the March meeting – stocks immediately sold off on the news. Current market forecasts anticipate the Fed beginning to cut rates by the May 1st meeting.

 

Need Some Guidance?

If all of this feels a bit confusing, don’t worry. We’re here to help! Our team of financial advisors is well-versed in all things related to BP retirement plans. Whether it is the BP RAP, ESP, SVP, RRSP, or any other BP-related plans, we’ve got you covered.

Want to learn more? Simply email us at info@capstonewealthadvisors.com or give us a call at (877)739-6007.

Best wishes,

Capstone Wealth Advisors

Bellingham, WA

877-739-6007

Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.

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