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Hilcorp 401k Consulting

Are you embarking on a new chapter in your working career with Hilcorp?

With your transition to Hilcorp comes the task of becoming familiar with a completely new 401(k) plan. Capstone Wealth Advisors is here to help demystify your new 401(k) plan and take the guess work out of which investment options to select. We provide quarterly custom-built asset allocation recommendations, specifically designed for the options available in your 401(k) plan. Capstone Wealth Advisors is committed to providing you with up to date information on your Hilcorp 401(k) plan.

401(k) Overview

Your new Hilcorp 401(k) is a key component in planning for your retirement. Understanding how your plan works can help maximize your retirement savings. You can contribute to the 401(k) plan on both a Pre-Tax and Roth basis. Additionally, every dollar you contribute into your 401(k) is matched by Hilcorp up to 6% of your salary.

Eligible employees will be automatically enrolled into the plan with an initial 6% contribution rate. This rate can be modified at any time up to a maximum of 75% of your salary. If you are under the age of 50, the IRS caps contributions at $19,500. If you are over the age of 50, you can contribute up to $26,000.

There are several differences between your old BP ESP and the new Hilcorp 401(k). Most notably, your company match goes from 7% to 6%. You will no longer be able to make “After-tax” contributions into your Hilcorp Plan. Also, if you are under the age of 59 ½, you are no longer permitted to roll money out of the Hilcorp plan while still employed.

Hilcorp does not currently offer a pension plan for its employees, which means it is critical you properly plan and save for your retirement.

Rollovers:

Rolling funds out of your Hilcorp 401(k) plan is not permitted while you are still employed with exception of those who are over the age of 59 ½. Once you are separated from the company, you will be allowed to rollover the entire balance of your vested 401(k).

401(k) Loans:

Plan loans are allowed up to a maximum of $50,000 or half of your account balance, whichever is less.  The current stated interest rate is 4.25% for 401(k) loans. Only one outstanding loan at a time is permitted.

Vesting:

The term “vesting” refers to the portion of company matching dollars that are legally yours to keep.  The longer you remain an employee of Hilcorp, the higher your vested amount will be.  For example, an employee who has worked for Hilcorp for more than 5 years is 100% vested and entitled to receive all company match dollars contributed into his or her 401(k) plan. Conversely, an employee who has less than one year with Hilcorp is 0% vested will not receive any of the company matching dollars if separated from the company before their first anniversary of employment. Vesting percentages are based on years of employment with the company at the time of separation and based on the following schedule.

Under 1 year =     0%

1 to 2 years =   20%

2 to 3 years =   40%

3 to 4 years =   60%

4 to 5 years =   80%

Over 5 years = 100%

Target Date Funds:

Capstone Wealth Advisors currently does not recommend investing in any of the Target Date investment option offered inside the plan due to several issues relating to the lack of public disclosure for these options. Additionally, the Target Date options offered within the plan are investment funds that own other funds, this means you are paying multiple layers of asset management fees for every fund the Target Date option invests in. Because of this, we are not currently recommending you invest in these funds.

Capstone Wealth Advisors offers asset allocation models to assist with how you structure your Hilcorp 401(k) investments. If you would like to receive regular updates as they are released please sign up for our newsletter.

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