The 2025 Intel Layoffs and Your Retirement Benefits
Throughout 2025, Intel has been conducting massive layoffs, affecting over 25,000 employees in what CEO Lip-Bu Tan calls a necessary "cultural reset." Unlike previous layoffs at Intel that came with severance packages, voluntary buyouts, and early retirement options, the 2025 rounds offer little to no safety net for departing employees.
This harsh reality makes protecting your retirement benefits more critical than ever. Here's what to know about how layoffs affect your retirement planning and what steps you can take to protect your financial future.
The New Reality: No Severance, No Early Retirement
Unlike previous Intel workforce reductions, which offered severance or buyouts, the 2025 layoffs provide no such safety net. In a stark departure from past precedent, no severance packages or voluntary buyouts will be offered to affected employees. Instead, Intel will make decisions based on a combination of performance evaluations, skill assessments, strategic portfolio adjustments, and project prioritization.
This means that if you're laid off, you'll need to navigate the transition without the financial cushion that Intel previously provided. Your retirement benefits become even more valuable in this scenario.
What Happens to Your Intel Stock Benefits?
Your stock compensation is likely a significant part of your total compensation package, but layoffs can dramatically impact these benefits.
Restricted Stock Units (RSUs)
Here's what typically happens to your RSUs when you're laid off from Intel:
Unvested RSUs: Unless you meet retirement eligibility guidelines, all unvested RSUs and options are cancelled. This can represent a substantial loss if you have significant grants that haven't vested yet.
Vested RSUs: These remain yours, but you'll need to decide whether to hold Intel stock or diversify your portfolio.
Accelerated Vesting: Retirees get anywhere from one to four years of accelerated stock vesting. By meeting the rule of 75 (your age and your years at Intel add up to a total of 75), you will get one year accelerated. Retirees over 60 years old get one year accelerated for each five years of service. However, this only applies if you meet Intel's retirement eligibility requirements, not if you're laid off.
If you sell vested RSUs, you'll owe capital gains tax on any appreciation since the vesting date.
Stock Options
If you are eligible for retirement, you likely have up to 12 months before your stock options retire. If you are retiring before that eligibility window, you may only have 90 days.
If you're laid off and don't meet retirement eligibility, you typically have just 90 days to exercise your stock options. This creates an immediate decision point that could significantly impact your finances. If you decide to exercise stock options, consider the tax implications:
Incentive Stock Options (ISOs): May trigger Alternative Minimum Tax (AMT).
Non-Qualified Stock Options: Taxed as ordinary income when exercised.
Employee Stock Purchase Plan (ESPP)
If you terminate employment with Intel before the end of a subscription period, you will receive a full refund of your ESPP contributions for that period within 2-4 pay periods after your termination. Stock will not be purchased for you, and you will not receive interest on the money you contributed to the ESPP for that period.
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Your Intel 401(k) and Pension Benefits
The good news is that your 401(k) and pension benefits are generally protected when you're laid off.
Intel 401(k) Savings Plan
Access to your Intel 401(k) Savings Plan account does not cease upon leaving Intel. You can still log in at www.netbenefits.com/intel. Your options include:
Leave your money in the Intel 401(k) plan (if your balance is above the minimum threshold)
Roll over to a new employer's 401(k) plan
Roll over to an IRA for more investment options and potentially lower fees
Take a distribution (though this comes with taxes and potential penalties)
Intel Pension Plan
If you're eligible for Intel's pension plan (typically employees hired before 2011), your benefits are protected. You'll need to decide between a lump sum payout or monthly payments when you reach retirement age.
SERPLUS (Deferred Compensation)
Unlike 401(k) funds, deferred compensation is an unsecured promise from Intel. While the company is financially strong, this money isn't protected like FDIC-insured deposits or securities in your brokerage account.
The good news is that you generally can't change your distribution elections once they're made, so your previously elected distribution timing should remain intact even after a layoff.
Health Benefits and COBRA
Intel STD and LTD insurance end at midnight on your last day of employment. Your health insurance also ends, but you have options:
COBRA: Continue your Intel health coverage for up to 18 months, though you'll pay the full premium plus a 2% administrative fee.
Marketplace plans: Shop for individual coverage through Healthcare.gov.
Spouse's plan: If your spouse has employer coverage, you may be able to join their plan.
Immediate Action Steps After a Layoff
1. Understand Your Stock Benefit Deadlines
To review the details of your stock account, contact an E-Trade representative at (800) 838-0908. You’ll want to find out:
Which stock options expire in 90 days
Whether any RSUs are close to vesting
Your ESPP refund timeline
2. File for Unemployment Benefits
Even though Intel isn't providing severance, you're entitled to unemployment benefits. File immediately, as there's often a waiting period before benefits begin. Note that unemployment benefits are taxable income, so plan accordingly for next year's tax bill.
3. Evaluate Your 401(k) Options
Consider whether to leave your money in Intel's plan or roll it over. Factors to consider include:
Investment options and fees
Loan options if you have an outstanding 401(k) loan
Whether you'll need early access to funds
4. Review Your Emergency Fund
Without severance to cushion the blow, your emergency fund becomes critical. If it's not sufficient, consider:
Reducing non-essential expenses immediately
Exploring part-time or contract work
Understanding your options for early 401(k) withdrawals (though these come with penalties)
5. Reassess Your Retirement Timeline
Without Intel's generous benefits continuing to accumulate, you may need to:
Work longer than originally planned
Reduce retirement expenses
Find new employment with comparable benefits
6. Preserve Tax-Advantaged Accounts
Tempting as it may be, it’s generally unwise to raid your 401(k) or IRA for living expenses. The taxes and penalties can be substantial, and you'll lose years of potential compound growth.
7. Consider Roth Conversions
If you're in a lower tax bracket while unemployed, it might be an opportune time to convert some traditional IRA or 401(k) funds to a Roth IRA.
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The Broader Impact on Retirement Security
The ongoing layoffs at Intel are more than a response to financial pressures, which include a $19 billion loss in 2024 and an $821 million deficit in Q1 2025. This financial instability affects not just current employees but also the long-term security of pension obligations and the company's ability to continue generous benefits. For employees still at Intel, this serves as a wake-up call to:
Maximize retirement savings while still employed
Diversify investments beyond Intel stock
Build a larger emergency fund if possible
Consider the stability of long-term career plans
Don't Navigate This Alone
Losing your job at any stage of your career is stressful, but it's particularly challenging when you're in your peak earning years and approaching retirement. The decisions you make in the next few months will have lasting impacts on your retirement security.
At TrueWealth Financial Partners, we understand the unique challenges facing Intel employees during this difficult time. We've helped numerous tech employees navigate layoffs, optimize stock benefit decisions, and rebuild retirement plans after job loss.
As a fee-only fiduciary firm, we provide objective guidance tailored to your specific situation. We can help you:
Analyze your stock option exercise decisions
Optimize your 401(k) rollover strategy
Plan for the tax implications of your decisions
Rebuild your retirement plan with your new reality
Make the most of any severance if you received one from an earlier round
The layoffs at Intel are unprecedented in their scope and lack of support for affected employees. But with the right planning and guidance, you can still protect your retirement security and move forward with confidence.
Don't make critical financial decisions in isolation. If you’re preparing for retirement, schedule a free consultation, and we can help you understand your options and create a plan to protect your financial future, even in these uncertain times.
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FAQs
I was laid off from Intel and have unvested RSUs. Is there any way to get them?
Unfortunately, unless you meet Intel's retirement eligibility requirements, unvested RSUs are cancelled when you're laid off. This is different from voluntary retirement, where you might get accelerated vesting. There's typically no negotiation possible on this policy during layoffs.
I have Intel stock options that expire in 90 days. Should I exercise them if I don't have the cash?
This depends on whether the options are "in the money" (the strike price is below the current stock price). If they are, you might consider a "cashless exercise" where you sell some shares immediately to cover the exercise cost. However, be aware of tax implications. If the options are underwater (strike price above current stock price), they have no value, and you can let them expire.
Can I keep my money in Intel's 401(k) plan after being laid off?
Yes, as long as your account balance meets the minimum threshold (typically $5,000), you can leave your money in Intel's 401(k) plan indefinitely. You'll continue to have access to the same investment options, but you won't be able to make new contributions. Many people choose to roll over to an IRA for more investment choices and potentially lower fees.
Will Intel's financial troubles affect my pension if I'm vested?
Intel's pension plan is protected by federal law and backed by the Pension Benefit Guaranty Corporation (PBGC). Even if Intel were to go bankrupt (which is not expected), your vested pension benefits would still be paid, though there are caps on the maximum benefit the PBGC will cover. Your pension is much safer than unvested stock compensation.
I was planning to retire soon. How do the layoffs change my timeline?
Being laid off before retirement eligibility means you lose the accelerated vesting benefits that come with voluntary retirement. You'll need to reassess whether you have enough saved without those unvested stock grants. You may need to work elsewhere for a few more years, reduce retirement expenses, or delay retirement. A financial planner can help you run scenarios based on your specific situation.
Should I consider early retirement instead of waiting to be laid off?
If Intel offers another voluntary retirement package and you're eligible, it could be worth considering. Voluntary retirement often comes with better stock vesting benefits and sometimes severance payments. However, Intel's recent statement indicated they won't offer early retirement options in future layoff rounds. If you're close to retirement eligibility, it might be worth staying until you qualify.