Raytheon / RTX Pension Calculator: Lump Sum vs Monthly Annuity
Enter your RTX pension benefit — whether from legacy Raytheon, UTC, Pratt & Whitney, or Collins Aerospace — and the current IRS segment rates to compare lump sum vs monthly annuity and find your break-even age.
Get retirement alerts
We track IRS rule changes, rate updates, and retirement law changes. One email when something moves enough to affect your math.
The 2020 Raytheon-UTC merger and pension plans
In April 2020, Raytheon Company merged with United Technologies Corporation to form RTX Corporation (originally named Raytheon Technologies). The combined company is one of the world's largest aerospace and defense contractors, encompassing Raytheon, Pratt & Whitney, and Collins Aerospace as major divisions.
The merger brought together several large legacy pension plans. Each plan remains a legally distinct entity post-merger, meaning Raytheon retirees have a claim on the Raytheon pension trust, UTC retirees on the UTC trust, and so on. The plans are now administered centrally under RTX's benefits team but have different benefit formulas, early retirement provisions, and lump sum calculation methodologies depending on which legacy company employed you and when.
Pratt & Whitney and Collins Aerospace pension specifics
Pratt & Whitney's pension plan has historically included both a traditional defined benefit formula and a cash balance component, with the applicable formula depending on hire date and elections made by employees when UTC modified its plan structure in the early 2000s. Employees hired before certain cutoff dates may have blended benefits.
Collins Aerospace inherited pension obligations from two distinct predecessors: UTC Aerospace Systems (itself formed from several earlier UTC businesses) and Rockwell Collins, which UTC acquired in 2018. Rockwell Collins participants are covered under a separate plan that was merged into the broader Collins structure. If you were a Rockwell Collins employee before the 2018 acquisition, confirm with RTX benefits which plan governs your accrued benefit.
How RTX calculates the lump sum
RTX legacy pension plans use the IRS three-segment interest rate framework under Section 417(e) to calculate lump sums. The lump sum is the present value of your expected lifetime monthly payment stream, discounted using IRS-published segment rates. RTX typically locks in November segment rates from the prior calendar year for lump sum elections in a given plan year.
The rate environment at retirement significantly affects the lump sum. At the elevated rates of 2024–2026, lump sums are materially smaller than they were at the rate lows of 2020–2021. A retiree who delayed by three years to 2025 and received identical accrued benefits could face a lump sum 15–20% smaller than a peer who retired at the rate trough.
PBGC coverage for RTX plans
All RTX legacy pension plans are single-employer defined benefit plans insured by the PBGC. The 2025 PBGC maximum guarantee is $7,607.83 per month at age 65 for a single-life annuity. RTX has historically maintained strong pension funding ratios given its defense contract cash flows, which reduces (but does not eliminate) the probability of needing PBGC intervention. Benefits above the PBGC maximum would be at risk if the plan sponsor failed and PBGC assumed the obligation.
Related calculators
Lump Sum vs Annuity
Generic present value and break-even analysis for any pension
Pension Buyout Analyzer
Evaluate any pension buyout offer against present value
Boeing Pension Calculator
Boeing-specific analysis with 2023 Athene risk transfer details
Verizon Pension Calculator
Verizon-specific analysis covering both 2012 and 2015 risk transfers
For high-stakes decisions
Running six-figure numbers? Get a second opinion.
A fee-only fiduciary can model your specific situation. No products sold. No commissions. Most charge $200-500 for a one-time analysis.
Find a fee-only advisorPensionMath earns no referral fee from NAPFA. We link there because it is the most trusted source for fee-only advisors.
Frequently asked questions
What happened to Raytheon's pension after the UTC merger?
Raytheon merged with UTC in April 2020 to form RTX. Legacy pension plans remain legally distinct — each with its own trust and benefit formula — but are now administered centrally by RTX. All plans are single-employer plans covered by PBGC.
Is the Raytheon / RTX pension PBGC-insured?
Yes. All RTX legacy plans are covered by PBGC. The 2025 PBGC maximum at age 65 is $7,607.83/month for a single-life annuity. RTX has historically maintained strong funding ratios.
How does RTX calculate the lump sum?
RTX uses IRS §417(e) three-segment rates — typically the prior November rates. Segment 1 discounts months 1–60, segment 2 covers months 61–240, and segment 3 applies beyond month 240. Higher rates produce smaller lump sums.
Are Pratt & Whitney and Collins Aerospace pensions different?
Yes. Each legacy company had its own plan structure. Pratt & Whitney offered both traditional DB and cash balance components. Collins Aerospace merged plans from UTC Aerospace and Rockwell Collins (acquired 2018). Contact RTX benefits to confirm which plan and formula applies to you.
Should I take the RTX lump sum?
The annuity wins with strong longevity and survivor needs. The lump sum wins with shorter life expectancy and strong investment discipline. RTX is well-funded historically, so the risk premium for taking the lump sum is lower than at more financially stressed employers — but the rate environment still matters significantly.