Marathon Petroleum
Retirement planning for
Marathon Petroleum employees
If you work at the Galveston Bay Refinery and you're getting close to retirement, you have several decisions ahead that can't be changed afterward. Marathon publishes five different versions of the plan summary, and most articles online describe one version without saying which — this page explains what your choices are, using the plan documents themselves as the source.
Schedule a complimentary ConsultationWho this page is for,
and who we are
Burrows Capital Advisors is a wealth management firm in Webster, Texas. We are not affiliated with, endorsed by, or sponsored by Marathon Petroleum Corporation or Fidelity, and we are not the administrator of either plan. For official plan rules, benefit estimates, elections, and account administration, please use MPC's benefit resources and Fidelity.
The main reason so much retirement information about Marathon is confusing is that Marathon publishes five different versions of the Summary Plan Description for the same plan, depending on who employed you and when, and most articles describe one version without saying which. We put this page together to explain what your choices are, using the plan documents themselves and Marathon's own retirement guides as the source.
Schedule a complimentary 30-minute conversationWhat most articles
get wrong about this plan
Find your group
before you read further
Every eligible Marathon employee has a cash balance pension account and a Thrift Plan. Some people also have a second pension benefit that was frozen at the end of 2009, and whether you have that one depends on when Marathon first employed you. The rules for the two benefits differ on early retirement, on how interest rates affect a lump sum, and on what your survivor receives.
Whatever you believe your situation to be, we'd ask you to call Fidelity and confirm which version of the SPD applies to you before relying on anything here. This page is current as of September 2026 and is based on the Retirement Plan SPDs effective August 1, 2024, and the Thrift Plan SPD effective January 1, 2023.
Marathon Petroleum
is not Marathon Oil
The two company names are similar enough that people regularly confuse them, and it affects what retirement information you end up reading. Marathon Petroleum was spun off from Marathon Oil on June 30, 2011. MPC is the refining and marketing company and operates the Galveston Bay Refinery in Texas City, while Marathon Oil stayed in exploration and production until ConocoPhillips acquired it in November 2024.
A search for retirement advice about "Marathon" tends to bring up material about pension freezes, interest rate risk on lump sums, and buyout windows — most of which was written about a final-average-pay plan. Some of that material is relevant if you have a frozen Legacy benefit, but it doesn't describe how a cash balance account works. Applying final-average-pay advice to a cash balance account is the most frequent misunderstanding we run into with this plan.
You can check which plan you're in by looking at your Fidelity statement. If it says Marathon Petroleum Retirement Plan, this page describes your plan.
How the cash balance
pension works
For each year you work at Marathon, the company credits a percentage of your pay to a pension account in your name, and interest is added to the balance monthly. When you retire, you receive whatever the balance has grown to, either as a lump sum or converted into monthly payments. Unlike an older pension, calculated from your final salary and years of service, this benefit is just the account balance on the date you take it.
Pay credits
The percentage credited each year depends on your age plus your years of service, which Marathon calls your Plan Points.
| Your Plan Points | Pay credit for that year |
|---|---|
| Less than 50 | 7 percent of your eligible pay |
| 50 to 69 | 9 percent |
| 70 or more | 11 percent |
Marathon's own examples are a 40-year-old with 15 years of service (55 points) and a 55-year-old with 25 years (80 points). Since both your age and your service increase every year you stay, your percentage will step up from 7 to 9 to 11 over the course of a career without any action on your part.
How service is counted
The years-of-service figure Marathon uses may not match the number of years you've worked at the plant. Marathon counts the months you were eligible for the plan after December 31, 2009, plus whatever vesting service you had as of that date. If you came in through an acquisition, some of your earlier service may count as well, but that depends on a rule specific to each acquisition — the reason we suggest in the BP section below that you ask Fidelity about your pre-2013 years specifically.
What pay counts in your final year
When you're deciding on a last day, the pay counted toward your final year's credit doesn't include a vacation payout, unused leave, severance, or salary continuation paid after you leave. Those amounts are taxable compensation to you, but they won't increase your final pay credit.
Interest credits
Interest is credited on the last day of each month on the balance you had on the first of the month. The rate for the year is the greater of 3 percent or the average yield on 30-year Treasuries, set each January 1 from the previous August, September, and October. That rate stays fixed for the entire plan year, and the 3 percent floor applies regardless of where Treasury yields are.
Vesting, and what happens when you leave
Vesting normally happens after three years of service. The plan also treats you as fully vested regardless of service if you turn 65 while still working, if you leave because of death or disability, or if you're involuntarily terminated within 24 months of a change in control. After you leave, the annual pay credits stop, since those go only to active employees. Interest continues to be credited on the balance until you take the money out.
The question we're
asked most often
This is the question we're asked most often by people at the plant, and unfortunately the SPD doesn't address it directly. BP sold the Texas City refinery to Marathon on February 1, 2013. If you were at the plant before that date, your employer was BP, and BP is not — and is not listed in the SPD as — a participating employer in the Marathon Petroleum Retirement Plan.
Why it matters
- Your pay credit rate now. Service at an acquired company counts only where a special crediting rule applies. The SPD says those rules exist and come from corporate transactions, but it doesn't print them; it directs you to the Plan Administrator instead. We haven't been able to find the rule for the Galveston Bay acquisition in any public document.
- Whether the frozen Legacy benefit applies to you. That benefit requires that you were employed by a Marathon participating employer before January 1, 2010. A long career at the same plant doesn't by itself satisfy that requirement if BP was your employer during the earlier years.
One reason to ask
The Thrift Plan SPD has an appendix listing acquired companies whose service counts toward Thrift Plan vesting, and BP Products North America is on that list. The two Retirement Plan SPDs that apply at Galveston Bay have no equivalent appendix, so this doesn't establish anything about the pension. It does show that Marathon has recognized BP service in at least one of its plans, and on that basis we think it's appropriate to ask whether it does so in the pension as well.
What we'd recommend
Call Fidelity at 1-866-602-0595. Ask for your Cash Balance Service and your Vesting Service as two separate numbers, and ask directly whether any pre-2013 service is credited. Get the answer in writing.
If your BP years are credited, your Plan Points — and your pay credit rate — could be higher than you've assumed. If they aren't, much of what's written about this pension likely describes a benefit you don't have.
Schedule a ConsultationThe Legacy
Retirement Benefit
People employed by a Marathon participating employer before January 1, 2010, have a second pension benefit in addition to the cash balance account. At Galveston Bay, this is usually people who transferred from another Marathon location; someone who joined when Marathon acquired the refinery in 2013 generally wouldn't qualify, for the reasons discussed above.
The benefit is frozen, which means you stopped earning more of it some years ago. The amount you had accrued as of the freeze date remains payable to you, calculated and paid separately from the cash balance account.
What was frozen, and when
The freeze didn't happen all at once. Your Legacy service stopped accruing on December 31, 2009, and is capped at 37.5 years, while your Final Average Pay and the Social Security figure the formula uses were frozen on December 31, 2012. Your age and vesting service continue to update, because those determine whether you qualify for early retirement.
The benefit itself is a monthly pension based on a final-average-pay formula with a Social Security offset. Your Final Average Pay is your highest total pay over any 36 consecutive months in the 10 years of active employment before January 1, 2013, divided by 36. If you also have a pension from a company Marathon acquired, your monthly Legacy benefit is reduced by that amount; the SPD uses the Ashland pension plan as its example.
Early retirement
Early retirement under the Legacy benefit works differently from what most people expect, and applies only to that benefit. If you leave Marathon after age 50 with at least 10 years of vesting service, the reduction for starting early is a straight subtraction instead of a compounded actuarial reduction.
If you start after 62, there's no reduction at all. If you start earlier, you lose 3 percentage points for each year between 62 and 59, then 4 points for each year between 59 and 50 — meaning at 50 with 10 years in, you'd receive 55 percent of the age-65 amount. There's no equivalent subsidy on the cash balance account, since that benefit is whatever the balance happens to be on the date you take it.
If you don't qualify for early retirement, the plan applies a regular actuarial reduction instead, which is larger. We'd suggest asking Fidelity which reduction applies to you before you settle on a date.
There's also an exception to be aware of. If you left Marathon before 2010, came back on or after January 1, 2010, and had a break in service in between (an anniversary service year, measured from your original hire date, with 500 hours or fewer), you can't become eligible for early retirement later.
Taking the Legacy benefit while still working
You're permitted to take the Legacy benefit at age 59½ while you're still working. Taking it in service doesn't require you to separate from Marathon, although the spousal consent rules described later still apply, and the distribution remains eligible for rollover like any other lump sum.
Before doing that, it's important to compare it with the early retirement schedule. Taking the benefit at 59½ instead of 62 means accepting a permanent reduction of roughly 7.5 percentage points if you qualify for the early retirement schedule, and more than that under the regular actuarial reduction. Whether that's acceptable depends on how the Legacy lump sum has been affected by the interest rate used to calculate it, whether you have a use for the money before you retire, and how many more years of pay credits you expect to earn on the cash balance account in the meantime. We'd suggest having Fidelity run the numbers both ways before deciding.
What your family receives if you die before payments begin
There is a period during which your family's protection is narrower than most people realize. If you die after leaving Marathon but before filing a valid payment election, and you don't have a spouse at the time, nothing is paid from the Legacy benefit. If you die while still employed, that rule doesn't apply and the benefit goes to your named beneficiary or your estate.
The period during which this rule could affect your family is therefore the time between your last day of employment and the date the plan receives a valid election from you. To reduce that risk, we'd suggest confirming a beneficiary is on file before you leave, and submitting your payment election as soon as the plan will accept it.
Getting an estimate
What any of this pays depends on your own record, so we'd encourage you to ask Fidelity for a Pension Benefit Modeling Statement at more than one commencement date before you decide anything. A modeling statement is only valid through the commencement date printed on it, so if your date moves, you'll need to request a new one.
The January 1 and February 1 commencement rule
If you have the Legacy benefit and choose a commencement date of January 1 or February 1, the plan calculates your Legacy lump sum at both the current year's interest rate and the previous year's, and pays you the higher of the two. If you choose one of those dates in the same calendar year you retire, you receive that treatment only if you retire on or before January 7.
In practice, a retirement date in the first week of January may produce a larger Legacy lump sum than a date a week later, purely because of which interest rates the plan is permitted to use. Taking advantage of it requires planning: for a January 1 commencement, your application needs to start the previous summer. We'd suggest asking Fidelity which combination of last day and commencement date they'll accept, and having them quote a January 1 commencement alongside whatever date you were planning on.
How interest rates
affect your lump sum
Interest rates affect the two benefits in opposite directions, and much of the published commentary on pension lump sums fails to distinguish between them.
This is the mechanism that general articles about pension lump sums are describing, and it does apply to the Legacy benefit, though not to the cash balance account.
Two rules that limit the effect
Appendix A of the SPD contains two provisions that limit the effect of rising rates on the Legacy lump sum. The rate the plan uses is the lowest of four different rates, including PBGC rates from the prior year and averaged segment rates under Internal Revenue Code section 417(e)(3). In addition, a transition rule has capped the annual increase in the rate at 0.25 percentage points for commencement dates after 2022.
The transition rule doesn't apply indefinitely. It stops applying in the first year the regular calculation produces a rate lower than the transition rule would. The regular calculation's own annual increase is tiered at 0.25, 0.50, or 0.75 points depending on the prior November's 12-year corporate bond spot rate — so in years when corporate bond rates are elevated, the regular calculation permits a larger annual increase than it would in a lower-rate year.
Because of that end condition, we wouldn't recommend assuming the transition rule still applies to your benefit. We'd suggest asking Fidelity which rate was used in your most recent estimate and whether the transition rule was still in effect at that time.
Rates and monthly income
Rates also affect both benefits in one other way. Converting any amount into an annuity uses the plan's interest and mortality factors, and those move with rates — affecting how much monthly income a given lump sum would convert into, for both benefits.
Checking the rate on your statements
If you want to check the cash balance crediting rate against your own statements, compare one January with the next, since the rate is set once a year and held; a month-to-month comparison won't show anything. Because the rate is based on the prior August through October, a rise in long-term yields may not be reflected in your account for more than a year after it occurs.
Lump sum or
monthly payments
The decision is usually described as a choice between a single payment and monthly income for life, which is accurate as a general description — although within each of those there are further choices to make.
The payment forms the plan offers
- Lump sum. The account balance for the cash balance benefit, or the discounted present value for the Legacy benefit.
- Single life annuity. Paid to you for your lifetime only, and reduced if you start before 65.
- Joint and survivor annuity at 25, 50, 75, or 100 percent. Continues to your spouse or a named beneficiary after your death at the percentage you elected.
- Life and term certain annuity. Guarantees payments for 5, 10, or 15 years regardless of how long you live.
- Temporary lifetime payment (Legacy benefit only). For people who qualify for early retirement. It runs until 65 and then requires a permanent election; if none is made, the plan pays a single life annuity if unmarried, or a 50 percent joint and survivor annuity if married. Choosing this form also requires a separate, permanent election for the cash balance benefit at the outset.
In our experience many participants aren't aware the term-certain option exists.
| Lump sum | Annuity | |
|---|---|---|
| What you receive | A single payment | Monthly income for life, or for a guaranteed term |
| Who manages it afterward | You, or an advisor you choose | The plan |
| What your survivor receives | Whatever is left, through your beneficiary designation | The percentage you elected: 25, 50, 75, or 100 |
| Who bears the risk of a long life | You | The plan |
| Can you change your mind | Yes, as long as there's money left | Generally no, once payments start |
| Where it can be paid | To you, to an IRA, to your own Marathon Thrift Plan, or to another employer's plan that accepts rollovers | To you, monthly |
| Tax when paid | 20 percent withheld unless directly rolled over | Ordinary income as received, with withholding you choose |
| 10 percent early distribution penalty | Applies under 59½ unless an exception fits | Doesn't apply to monthly annuity payments |
| Spousal consent, if married | Required, witnessed | Required unless the form gives your spouse at least a 50 percent survivor annuity |
If you have both benefits
Marathon's payment guide says a lump sum election covers the whole benefit, so you can't take one benefit as a lump sum and leave the other in the plan for monthly payments. You can split a lump sum between a direct rollover and a payment to yourself.
Marathon describes two routes for handling the two benefits differently: the in-service election, where you settle the Legacy benefit at 59½ and decide on the cash balance benefit when you leave; and, if you qualify for early retirement, the temporary lifetime payment form, which requires a separate election for the cash balance benefit at the outset. We'd suggest asking Fidelity to confirm in writing which applies to you.
What happens without an election
- If your total benefit is $7,000 or less, the plan pays it as a lump sum and you don't get an annuity option.
- If it's between $1,000 and $7,000, it goes to an IRA in your name unless you make a different election by the deadline.
- If it's $1,000 or less, it's paid straight to you.
The $7,000 figure is set by federal law. Congress has raised it before, most recently for distributions after 2023, and the SPD says it will be increased in future years as federal law permits. Federal law can also require the plan to limit or suspend lump sum payments if its funding level falls below a certain threshold; the SPD states the plan was adequately funded as of August 1, 2024, but we'd suggest asking Fidelity whether any restriction is currently in effect before you rely on receiving a lump sum.
How the decision
usually gets made
In our experience, the households we've worked with have generally needed to answer a few questions before they could make this decision comfortably:
- How much income you need each month, and how much is already covered by Social Security and the Thrift Plan
- How long your household needs the income to last
- What happens to your spouse if you die first
- What your tax situation looks like in the year you take the money
We describe these situations to illustrate the kinds of considerations involved, not as recommendations. Which applies to you, if any, depends on facts about your household that would need to be established first.
Your spouse's
consent
If you're married, you can't take a lump sum, a single life annuity, or any form that leaves your spouse less than a 50 percent survivor annuity without your spouse's written consent. The consent has to be notarized or signed in front of an authorized plan representative, on the plan's own form, included in your election package.
What the consent protects
Suppose your benefit works out to $3,000 a month (this is an illustration, not a quote).
- Single life annuity. You receive $3,000 a month for as long as you live, and after you die nothing more is paid.
- 50 percent joint and survivor. The monthly amount while you're both alive is somewhat lower, and about half of that lower amount continues to your spouse for life.
- 100 percent joint and survivor. The monthly amount is lower again, and after your death your spouse keeps receiving the same amount you were getting.
The size of your own reduction depends on both of your ages, and Fidelity will quote it for you. Any of those elections may be appropriate depending on your circumstances — we'd suggest discussing the options together well before the consent form arrives, so the notary appointment is a formality.
If you're the spouse reading this
The plan won't process the election without your signature, and the consent requirement exists so you have a say in an election that affects your own income later in life. It would be reasonable to ask, before the notary appointment is scheduled, what each survivor percentage would pay you if your spouse were to die first.
If your spouse dies while still working at Marathon, you receive a monthly annuity for the rest of your life. It can't be less than what a 50 percent joint and survivor election would have paid, or, if larger, half of the lifetime benefit your spouse would have received by retiring that month — and you can take a lump sum instead if you'd prefer. If you're more than 10 years younger than your spouse, the plan reduces the annuity as though the gap were exactly 10 years.
Your protection is somewhat narrower during the interval after your spouse has left Marathon and before a valid payment election has been filed, so that interval is the one to keep as short as possible.
Scheduling the notary
If your household is on a rotating 12-hour schedule, the practical difficulty is often finding a time when both of you are off work and able to get to the same notary. For that reason we'd suggest scheduling the appointment well in advance of any deadline.
Rollovers: direct,
indirect, and where it can go
If you take a distribution that isn't sent directly to another plan or an IRA, the plan is required to withhold 20 percent of the taxable amount for federal tax, whether or not you intended to roll it over. In our experience this withholding rule is one of the most common sources of an unexpected tax bill in the year of retirement.
| Direct rollover | Indirect rollover | |
|---|---|---|
| Where the money goes first | To the receiving IRA or plan | To you |
| What's withheld | Nothing | 20 percent of the taxable amount |
| What you have to track | Nothing | 60 days from the day you receive it |
| To move the full amount | Automatic | You add the withheld 20 percent from other funds |
| If you only move part | Not applicable | The rest is taxable and may be subject to the 10 percent penalty |
The plan also lets you split a distribution, with part going as a direct rollover and part paid to you — withholding applies only to the part you receive.
Where a pension lump sum can go
The plan permits several destinations, including one that general rollover advice often omits. Marathon's payment guide says a pension lump sum can be rolled directly into your own Marathon Thrift Plan, as well as into an IRA or another employer's plan that accepts rollovers. The Thrift Plan SPD makes rollovers into the plan subject to the plan administrator's approval, and it limits transfers for people who left before age 50 or with fewer than 10 years of service — ask Fidelity whether you qualify.
Rolling it into the Thrift Plan keeps the money in a Marathon plan with the plan's institutional share classes, and because you've separated from Marathon, it generally preserves the age-55 exception described next. That last point is our reading of the tax code, not something Marathon's guide states — confirm it with your tax professional. If you're rolling to an IRA, Marathon's guide notes the account has to be set up in advance.
The age-55 exception
If you separate from service in or after the year in which you turn 55, distributions paid to you directly from that employer's plan aren't subject to the 10 percent early distribution penalty. This exception is a feature of the qualified plan and doesn't carry over to an IRA, under Internal Revenue Code section 72(t)(3)(A). It doesn't transfer to a different employer's plan either, although a later separation from that employer at 55 or older can qualify on its own.
In practical terms, someone who retires at 56 and rolls the entire balance into an IRA would no longer be able to use the exception for a withdrawal at 57 — a consideration if there's any chance you'll need to draw on the money before 59½.
How we're paid
You should know how we're paid, because it's relevant to all of this. If you roll a pension lump sum or a Thrift Plan balance into an account that Burrows Capital manages, the firm is compensated in a way it wouldn't be if you left the money where it is.
Leaving it in the plan, or moving it into your own Thrift Plan, may well cost you less. We think you should have that in mind — and should feel free to raise it — in any conversation you have with us about this decision. Your own tax situation is a question for your tax professional, and nothing on this page is tax advice.
What to do with
your Thrift Plan when you leave
When you leave Marathon, the Thrift Plan gives you four options for the account:
- Leave the money in the plan
- Roll it directly to an IRA
- Roll it into a new employer's plan, if you take another job and that plan accepts rollovers
- Take a taxable distribution — all at once, in partial withdrawals, or in scheduled installments
Deadlines by account size
| Account size | What happens |
|---|---|
| Above $7,000 | The balance stays in the plan until you decide, with no deadline until required distributions start at 73 or 75. |
| $1,000–$7,000 | It's rolled to an IRA automatically unless you tell the plan otherwise within 60 days of leaving. |
| $1,000 or less | It's paid out to you unless you elect a rollover within that same 60 days. |
The $7,000 figure comes from Marathon's 2026 Retirement Benefits Guide; the Thrift Plan SPD, last reissued in 2023, still prints the earlier $5,000 figure. Both plans now use $7,000, but only the Thrift Plan attaches a 60-day deadline to it.
The trade-offs
Leaving the money in the plan keeps the plan's institutional share classes and its $26 annual recordkeeping fee, along with the age-55 exception and the availability of partial withdrawals (up to four a year, $500 minimum) and installments. Your choices are the plan's fund menu plus its self-directed brokerage window. The Thrift Plan will also accept your pension lump sum, subject to the plan administrator's approval, so leaving the money there doesn't necessarily mean maintaining two accounts.
- Rolling to an IRA gives you the widest investment choice and consolidates things, but its cost depends on what you hold in it, and you lose the age-55 exception.
- A new employer's plan consolidates things as well, and whether it's a good idea depends entirely on how good that plan is.
- Taking cash gets you the money now and triggers tax, withholding, and possibly the early distribution penalty.
Leaving the money in the plan is a reasonable course of action, and depending on the household's circumstances it may be the more advantageous one.
If you're still working: check your match
Marathon matches your contributions up to 6 percent of your pay at $1.17 per dollar, and the match is calculated each pay period with no true-up at year end. If you front-load your contributions and reach the annual limit early, your match stops for the rest of the year and Marathon doesn't make it up later.
Spreading your contributions evenly across all pay periods in the year, so you don't reach the annual limit before December, can preserve a meaningful amount of matching contributions — and adjusting your election involves no cost. The match also doesn't apply to employees covered by a collective bargaining agreement unless the agreement specifically requires it; if you're in that group, confirm your eligibility with HR.
Pension buyout
offers
A buyout offer is a limited-time proposal from the plan sponsor to settle its obligation to you, usually by paying a lump sum or moving your benefit to an insurance company annuity. These offers are typically presented with a short response deadline and a lump sum figure that appears large — in our experience both features are intended to encourage a quick decision.
If you receive one, we'd suggest establishing the following before you respond:
- Exactly what's being offered, in writing, including whether it's a lump sum or an annuity transfer and to which insurer
- What you'd be giving up, including PBGC protection, any early retirement subsidy you've earned, and any survivor election already in place
- What the real deadline is, as opposed to what the cover letter implies
It also helps to compare that deadline to the plan's own timing. The plan asks you to contact Fidelity at least 45 days, and not more than 180 days, before your commencement date — so if a buyout letter gives you less time to decide than the plan gives you to start a benefit, that shorter period reflects a decision by whoever sent the letter and isn't something the plan requires.
Whether a buyout is in your interest depends both on how the amount offered compares with the value of the benefit you'd be giving up and on your household's need for guaranteed income, and neither of those can be evaluated quickly. The main risk, in our experience, is the deadline, because it tends to push people toward a decision before they've had time to consider either question properly.
The timeline
In our experience, the problems that arise in a retirement transition are more often caused by missed deadlines and poor sequencing than by a poor choice of payment form. The table below sets out the steps in the order they typically need to happen.
| When | What happens | Who handles it |
|---|---|---|
| Five years out | Confirm which SPD applies to you and whether any pre-2013 service is credited. Get your Cash Balance Service and Vesting Service as separate figures. Check your Thrift Plan contribution spread against the no-true-up rule. Get a Social Security estimate. | You, with Fidelity and the Social Security Administration |
| Two years out | Request Pension Benefit Modeling Statements for several commencement dates. If you have a Legacy benefit, compare a January 1 commencement with the date you were planning on. Work out what you need each month. Review your beneficiaries on both plans. | You, with Fidelity. This is usually when a first conversation with us makes sense |
| One year out | Compare payment forms. Talk through the survivor options with your spouse. Confirm retiree coverage and Medicare timing if you're near 65, and ask where you stand on the retiree health premium subsidy, which accrues by year of service. | You and your spouse, with the MPC Benefits Service Center at 1-888-421-2199 |
| 180–45 days before commencement | This is the application window. Contact Fidelity inside it. For a January 1 commencement that means starting the previous summer — count backward from the commencement date; your last day of work isn't the relevant starting point. | You, with Fidelity |
| When your election package arrives | Book the notary after you have the form in hand. If you're on a rotating schedule, allow more time than you think you'll need to get both of you there. Decide where your Thrift Plan money goes, and where a pension lump sum goes if you take one. | You and your spouse |
| Your retirement date | Your commencement date is normally the first of the month after this. For the better-of interest rate on a January 1 or February 1 commencement in the same year you retire, this date has to be on or before January 7. | You |
| Separation, and 60 days after any distribution | Expect the first pension payment about six weeks after your commencement date and plan for the gap. If any distribution is paid to you instead of transferred directly, the 60-day rollover period begins on the day you receive the payment. | You |
| Your first year out | First distributions and their withholding. Your Social Security filing decision if you haven't made it. Estate documents and beneficiaries updated to reflect your new situation. | You, with your tax and legal professionals |
| Age 73, or 75 if born in 1960 or later | Your benefits have to start by April 1 of the following year, or later if you're still working. If you miss it, the excise tax on what wasn't distributed is 25 percent, reduced to 10 percent if corrected within the IRS correction period. | You |
Dates that carry a cost if missed
- The 180-to-45-day application window
- The January 7 retirement date, if you want the better of two years' interest rates
- The 60-day deadline on an indirect rollover
- The 60-day Thrift Plan deadline on balances of $7,000 or less
- The required minimum distribution deadline at 73 or 75
Of these, the required distribution deadline is the one with a penalty stated as a percentage of the amount: an excise tax of 25 percent of what should have been distributed, or 10 percent if corrected promptly. Missing the 60-day rollover deadline before 59½ also triggers the 10 percent early distribution tax on the amount not rolled over.
Questions to ask
before you elect
We'd suggest asking these of Fidelity and of MPC, and also of any advisor you consult, including us.
- Which version of the Summary Plan Description applies to my benefit, and do I have a Legacy Retirement Benefit as well as a cash balance account?
- Is any of my pre-2013 service at Galveston Bay credited, and under what rule?
- What are my Cash Balance Service and my Vesting Service, as separate figures?
- What are my current Plan Points, and what rate am I earning this year?
- What is my cash balance today, and what crediting rate applies this plan year?
- If I have a Legacy benefit, what would it pay at a January 1 commencement compared with other dates, and which interest rate did you use?
- Am I eligible for the early retirement schedule, or does the actuarial reduction apply to me?
- Can I elect different payment forms for my two benefits, and will you confirm that in writing?
- What does my spouse receive under each joint and survivor percentage, and what does each one cost me per month?
- What does the 5-, 10-, or 15-year term certain option pay, and how does it compare with the survivor options?
- Is my benefit above or below the automatic cash-out threshold, and if it's between $1,000 and $7,000, what is my deadline?
- Are lump sums currently available, or has a funding-based restriction been applied?
- Who will the plan accept as a witness for my spouse's consent?
- If I separate at 55 or later, what do I give up by rolling my Thrift Plan to an IRA, and can I roll my pension into the Thrift Plan instead?
What a first
conversation covers
You may reasonably wonder what an advisor adds, given that MPC and Fidelity will answer most of the questions above at no charge and this page has repeatedly suggested contacting them.
Fidelity is the right source for the figures on what each payment form would pay, and we rely on those figures ourselves. Fidelity's role doesn't extend, however, to advising you on which form is suitable for a household that also has a Thrift Plan balance, a spouse of a different age, an outstanding Social Security filing decision, and some flexibility about which tax year the money is received in. MPC's benefits staff are responsible for administering the plan and not for your overall financial picture. The work of considering all of those elements together is what we do for clients.
What we don't do
We don't take the place of the plan administrator. An estimate from anyone, including us, has no effect on what the plan owes you, and we don't file your paperwork or make elections on your behalf.
What to bring
It isn't necessary to have all of your information assembled before contacting us, but the first conversation tends to be more productive if you can bring some of the following:
- Your retirement date or target window
- Your latest Pension Benefit Modeling Statement from Fidelity and any election materials
- Your Thrift Plan statement
- Your current healthcare and HSA information
- Your Social Security estimate
- Your most recent tax return
- Your existing estate documents and beneficiary designations
You can bring them to the meeting or ask us for a secure upload link. Please don't send tax returns, benefit statements, or account documents through a website form or by email.
A first conversation has a limited scope, on purpose.
We'd review your intended retirement date and the decisions that follow from it, help you identify which have deadlines and which would be difficult to reverse, and give you our view on whether a fuller planning engagement would be useful — and what it would cost. We're in Webster and work with households around Bay Area Houston, including Clear Lake, League City, and Pearland.
Schedule a ConsultationFrequently asked questions
from Marathon employees
These elections are made once, and in most cases can't be changed afterward
A first conversation with us is complimentary, takes about 30 minutes, and covers your intended retirement date and the decisions that follow from it.
Schedule a complimentary ConsultationWebster, TX • (832) 835-1950 • Team@burrowscap.com
Where this information
comes from
Information on this page comes from documents Marathon publishes, tax rules from the Internal Revenue Code and IRS publications, and dates from company filings and press releases.
- Marathon Petroleum Retirement Plan, Summary Plan Description, Marathon Cash Balance Benefit and Legacy Retirement Benefit, effective August 1, 2024. Eligibility pp. 4–5; vesting p. 6; pay credits and interest credits pp. 7–8; Legacy benefit pp. 9–10; early retirement and in-service distribution pp. 11–12; application timing p. 13; payment forms and cash-out rule pp. 14–15; spousal consent p. 15; death benefits pp. 15–17; taxes pp. 17–18; required distributions pp. 12 and 19; Participating Employers p. 30; Appendix A interest rates pp. 31–32.
- Marathon Petroleum Retirement Plan, Summary Plan Description, Marathon Cash Balance Retirement Benefit Only, effective August 1, 2024.
- The three other SPD versions this page does not cover: Andeavor, Catlettsburg, Northwestern.
- Marathon Petroleum Thrift Plan, Summary Plan Description, effective January 1, 2023. Eligibility p. 2; contributions and match pp. 4–5; fees p. 16; distributions and thresholds p. 19; investment tiers p. 12 and Appendix B; taxes pp. 22–23; Appendix C, Service With Acquired Companies, pp. 37–38.
- MPC Retirement Plan Payment Decision Guide, 2026. Rollover destinations p. 3; lump sum is all-or-nothing, split with direct rollover, in-service elections p. 5; required distributions p. 6; withholding p. 7.
- MPC 2026 Retirement Benefits Guide. Who to call p. 3; retiree health subsidy pp. 4 and 9; application window, commencement date, six weeks to first payment, IRA set up in advance p. 5; Thrift Plan options and the $7,000 threshold pp. 7–8.
- Marathon Petroleum benefits site, Retirement Plan page (pay credit tiers, vesting, Fidelity contact). mympcbenefits.com/retirement-plan/
- Internal Revenue Code: §72(t) (10 percent early distribution tax, age-55 exception, §72(t)(3)(A) IRA exclusion, annuity exception); §401(a)(9) (required beginning date, ages 73 and 75); §402(c) (60-day rollover); §411(a)(11) (the $7,000 cash-out limit); §3405(c) (20 percent withholding); §4974 (25 percent excise tax, 10 percent if corrected).
- IRS Publication 575, Pension and Annuity Income. IRS Topic No. 558, Additional Tax on Early Distributions. IRS Required Minimum Distribution FAQs. IRS Notice 2020-62, model rollover notice.
- Marathon Oil Corporation, Form 8-K filed July 1, 2011 (spin-off completed June 30, 2011).
- BP p.l.c., Form 6-K, February 1, 2013 (sale of Texas City refinery completed).
- ConocoPhillips, press release, November 22, 2024 (acquisition of Marathon Oil completed).
- Marathon Petroleum, Galveston Bay Refinery.
Information on this page is current as of September 2026. Plan documents can change; the SPDs and guides above are the versions in effect when this page was written.
Before deciding whether to retain assets in a 401(k) or roll over to an IRA, an investor should consider various factors including, but not limited to, investment options, fees and expenses, services, withdrawal penalties, protection from creditors and legal judgments, required minimum distributions and possession of employer stock. Please view the Investor Alerts section of the FINRA website for additional information.The examples presented on this material are for illustrative purposes only and should not be deemed a representation of past or future results. Actual investment results may be more or less than those shown. This does not represent any specific product [and/or service].