Saudi Aramco Pension Scheme
Which Scheme is best for you…
About Saudi Aramco
Saudi Aramco is the state-owned oil company of the Kingdom of Saudi Arabia and a fully integrated, global petroleum and chemicals enterprise.
Over the past 80 years, they have become a world leader in hydrocarbons exploration, production, refining, distribution and marketing.
Saudi Aramco’s oil and gas production infrastructure leads the industry in scale of production, operational reliability, and technical advances. The plants and the people who run them make Saudi Aramco the world’s largest crude oil exporter. Producing roughly one in every eight barrels of the world’s oil supply.
Headquartered in Dhahran, Saudi Arabia, with offices and operations throughout the Kingdom and employ more than 65,000 workers worldwide thus many are affected by Saudi Aramco pension schemes.
Saudi Aramco Pension benefit schemes
Saudi Aramco is dedicated to looking after its employees for when they retire and plan to retire. With scheme access from the age of 60 and the possibility to join on the date of employment.
What schemes do they offer?
- Flexible Benefit Plan: Employees may make premium payments for their medical, dental, and optional accidental death and dismemberment insurance coverage on a pre-tax basis.
- Group Insurance Plan: They provide both Company-paid life insurance and accidental death and dismemberment insurance. Employees may also elect to purchase additional life insurance and accidental death and dismemberment insurance for themselves and their eligible dependents.
- Medical Payment Plan: Medical coverage is available for employees who elect to participate in the Plan and for their eligible dependents.
- Dental Insurance: They offer employees a choice between two dental plans. Employees pay the cost of the coverage they select.
- Retirement Income Plan: The Retirement Income Plan is a defined benefit pension plan. It provides retirement benefits to vested employees who retire from ASC. Employees become eligible to participate in the Plan on their hire date. They become vested upon completing five years of eligible service or upon reaching the Plan’s normal retirement age of 60. The company pays the entire cost of Plan.
- The Savings Plan – 401(k): To encourage employees to systematically save for their future financial security. New employees are automatically enrolled in The Savings Plan at a rate of 9 percent of their monthly base earnings unless they elect otherwise. The Company matches employees’ contributions dollar-for-dollar up to the first 9 percent of their monthly base earnings. Employees are vested immediately in the Company’s contributions.
- Short-Term Disability Plan: ASC provides certain salary continuation benefits for a specified period for employees who are unable to work because of illness or injury. New employees automatically become participants in the Plan upon completion of six months of continuous eligible service. The Company pays the entire cost of the Plan.
- Long-Term Disability Plan: They provide benefits for a specified period for employees who are unable to work because of a long-term illness or injury. The Company pays the entire cost of the Plan.
- Retiree Medical Payment Plan: Medical coverage is available for Retirees and their dependents who meet the Plan’s eligibility requirements and elect to participate in the Plan.
Retire abroad with a Saudi Aramco pension, what income can you expect?
All the above funds have a different pay structure to how retirement benefits are calculated. Let’s look at the retirement income plan (RIP).
Vesting in the RIP occurs when a Member completes 5 years of Service or reaches age 60, whichever occurs first. If a Member terminates employment with the Company before becoming vested, no benefits are payable under the RIP.
Your Retirement Income Plan benefit is determined by this formula:
2.0% x years of Accredited Service x final Average Earnings. Your RIP benefit is a monthly amount payable to you as an annuity starting at age 60. If you elect to begin your benefit before age 60 or select a different payment option, the RIP benefit may be adjusted.
What does all this mean in simple terms
Normal or Late Retirement: The RIP annuity benefit at normal or late retirement is determined by multiplying 2.0% of the Employee’s Average Earnings by the Employee’s years of Accredited Service.
Example: An Employee retires at age 60, on his Normal Retirement Date, with Average Earnings of $8,000 a month and 20 years of Accredited Service. The lifetime monthly annuity benefit from the RIP is:
2.0% x $8,000 x 20 = $ 3,200
Retired and looking for assistance? Seek advice from a financial advisor with regards to benefits and your pension. Contact Harrison Brook for an impartial chat with an experienced advisor.