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YOUR FINANCIAL FUTURE
Southwest airlines retirement benefits
Your Southwest Airlines career offers a robust retirement package, including a generous 401k plan, a Market Based Cash Balance Plan, three nonqualified plans and other benefits. To help you make the most of your options, we’ve compiled details about key benefits. Understanding the specifics of your retirement benefits will empower you to make informed decisions and maximize your retirement savings. Connect with us to answer questions about your options and explore the trajectory of your financial future.
WHAT YOU SHOULD KNOW ABOUT YOUR SOUTHWEST AIRLINES 401k
Your Southwest Airlines 401k account can be a tremendous wealth multiplier. This account has the potential to compound your contributions and investments over the course of your career.
Southwest Airlines contributes a generous portion of your eligible compensation to your 401k account for you. This is known as the non-elective contribution. You also have the ability to contribute your own money to the 401k plan up to the IRS maximum.
Your 401k has several key planning features you should be aware of. First, you will have the ability to indicate if you want to contribute to the pre-tax or the Roth feature of the 401k. This is helpful when managing current and future tax planning. Next, your Southwest Airlines 401k supports after-tax contributions and Roth conversions. This is useful if your elective deferrals and the company’s contributions do not take you to the IRS maximum and you’d like to top off the account.
When it comes to portfolio construction the investment menu will offer broad options allowing you to tailor your investment strategy. You can select from target date funds, index funds or use the self directed brokerage account for a more hands-on and customized investment experience.
What you should know about your other Southwest Airlines benefits
As a Southwest Airlines Pilot you have robust benefits. According to airline analyst Kit Darby of kitdarby.com, 10.2% of your career value is derived from your active and retirement benefits. Each year, during open enrollment you’ll have the option to select your benefits for the upcoming year during open enrollment. Medical, Dental, Life Insurance, Legal, and a few other insurance selections will need to be made during this time.
There are other benefits that you can enroll in at any time throughout the year. Your life is dynamic and your benefits shouldn’t be on autopilot year after year. Below we highlight several key company provided, union provided or contractually secured benefits*.
*The information presented is believed to be accurate. Some benefit options are subject to contract implementation. All benefits may be subject to change.
| Benefit | Details |
|---|---|
| 401k Administrator | Charles Schwab |
| Non-Elective Contribution | 18% |
| Profit Sharing | Yes – (Administered by Empower) |
| ESPP | Yes – (Administered by Fidelity) |
| Additional Retirement Contributions | Market Based Cash Balance Plan (2% automatic contribution) |
| MBCBP Target Asset Allocation | 40% Equity Target |
| Company Provided Life Insurance | $800k |
| Company Provided AD&D Insurance | $800k |
| Long-Term Disability | Contractual |
| LTD Benefit | 50% Monthly Base Earnings* |
| Legal Benefit Plan | Available |
| Union | SWAPA |
| SWAPA Disability Insurance | LTD Plus Up Options Available through METLIFE |
| Voluntary Insurance | Group Policy |
| Contract Amenability | 2028 |
*Monthly Based Earnings can be calculated several ways, depending on Pilot’s seniority (greater or less than 2 years) and if the client was on an approved long-term leave of absence in the last 12 months.
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The percent of SOUTHWEST Airlines pilots expected to retire between 2025 - 2029
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