Contributions

You decide how much you would like to contribute to the Savings Plan, from 1 to 50 percent of your pay each year up to IRS limits. Any contributions you make to the plan are made through convenient paycheck deductions.

In addition to deciding how much to contribute, you also decide whether you want to contribute on a before-tax, Roth after-tax or regular after-tax basis. (If you are age 50 or older, you can also make catch-up contributions.) Each type of contribution is held in a separate account. All contribution types are eligible for the company match, but company matching contributions are always made to your before-tax account.

The Company Match

Who doesn’t love free money? When you participate in the Savings Plan, you get paid to save!

You are eligible for the company match as soon as you enroll in the plan and begin making contributions. If you contribute more than 6 percent and reach the IRS annual limit before the end of the year, the company will continue making the matching contribution until 6 percent of your eligible pay is matched.

See page 11 of the Hess Savings Plan Investment Guide for an example of how the company match can help your account grow more quickly. It assumes your annual pay is $75,000, you contribute 6 percent and the rate of return is 6 percent. After 25 years, your account balance will have an extra $348,065 with the company match. Keep in mind, however, that the company match is discretionary, which means the company intends to provide the match but may decide it needs to change or stop the match.

Your Contribution Options

Before-Tax Contributions
Before-tax contributions come out of your paycheck before federal (and, in most cases, state) income tax is deducted. So, you’re taxed on a lower amount of income, which means you get a tax break up front. And the money you save — including investment earnings — won’t be taxed until you withdraw it from the plan after age 59½.
Roth After-Tax Contributions
The Roth feature means you contribute after-tax dollars into the Savings Plan, so you won’t have to pay taxes on these contributions when you take them out. With a Roth account, your earnings come out tax-free, provided you hold the account for at least five years and don’t withdraw the money until at least age 59½.
Regular After-Tax Contributions
You can contribute regular after-tax dollars into the Savings Plan. You can take out regular after-tax contributions while you are still working — in full at any time or a portion once every 12 months. Any associated earnings will be subject to ordinary income tax and a 10 percent penalty if withdrawn before age 59½.
Catch-Up Contributions
If you’re age 50 or older, consider making additional catch-up contributions up to the IRS annual limit, which can help you boost your savings before you retire. See the Key Terms section on page 24 of the Hess Savings Plan Investment Guide for more details.

Before-Tax or Roth?

There are two tax-advantaged ways you can contribute to the savings plan. You can make before-tax payroll deductions or after-tax “Roth” contributions. This chart can help you decide whether your contributions should be before-tax, Roth or a combination of both.

	BEFORE-TAX CONTRIBUTIONS	ROTH CONTRIBUTIONS
Funding	Funded with before tax dollars.	Funded with after-tax dollars.
Tax Benefits	You defer paying taxes; your balance grows tax free.	You pay taxes up front, but your contributions grow tax free.
Tax Treatment When You Withdraw The Money In Retirement	You pay taxes on before-tax contributions and earnings.	You pay no taxes on contributions or earnings if you’re at least 59½ (or you die, or you become disabled and you’ve held the Roth contributions for at least five years).
Why?	You think you’ll be in a lower tax bracket when you retire. You’re OK not knowing exactly what you’ll owe when you retire.	You think you’ll be in a higher tax bracket when you retire. You want the certainty of knowing exactly how much you’ll have in retirement.

How Saving Before-Tax Works*

	SAVING IN THE PLAN WITH BEFORE-TAX DOLLARS	SAVING OUTSIDE THE PLAN WITH AFTER-TAX DOLLARS
Your Annual Pay	$75,000	$75,000
Your Before-Tax Contribution At 6%	$4,500	$0
Taxable Income	$70,500	$75,000
Federal Tax Withheld	$10,534	$11,524
Net Income	$59,966	$63,476
After-Tax Savings Outside The Plan	$0	$4,500
Spendable Income	$59,966	$58,976
Savings Advantage	$990	$0

_{* This example is hypothetical and for illustrative purposes only. Actual taxes will vary. This example is based on 2024 standard deduction and exemption amounts.}