How much does Northrop Grumman match in the 401(k)?

Northrop Grumman matches 100% of the first 4% you contribute, plus 50% of the next 4% (for employees with less than 5 years of service) or 50% of the next 6% (for employees with 5+ years of service). The maximum match is 6% or 7% of your salary, depending on tenure.

Does the Northrop Grumman Savings Plan allow the Mega Backdoor Roth?

Yes. The Northrop Grumman Savings Plan allows after-tax contributions and offers an in-plan Roth conversion feature, which together enable the Mega Backdoor Roth strategy. This allows eligible employees to contribute and convert significantly more to Roth than the standard employee deferral limits.

Is there a Northrop Grumman pension?

Northrop Grumman offers a defined benefit pension program, but eligibility generally requires a hire date before July 1, 2008. Employees hired after that date typically receive an additional company contribution in the Savings Plan instead of a pension benefit.

When do Northrop Grumman 401(k) matching contributions vest?

Company matching contributions in the Northrop Grumman Savings Plan vest after 3 years of service. Your own contributions and any rollover amounts are always 100% vested immediately.

Does Northrop Grumman offer retiree medical coverage?

Northrop Grumman offers retiree medical coverage to eligible employees, but eligibility depends on hire date, age, and years of service. Coverage typically transitions to a Medicare supplement or marketplace plan at age 65. Contact the Northrop Grumman Benefits Center for details on your specific eligibility.

Understanding Your Northrop Grumman Retirement Benefits

Whether you’re a long-tenured Northrop Grumman employee thinking about retirement or a newer hire trying to make the most of your benefits, there’s a lot to understand. Northrop Grumman offers a solid retirement benefits package, but the details matter, and the decisions you make around these benefits can have a lasting impact on your financial future.

The plan details in this guide are believed to be accurate as of March 2026 based on publicly available plan documents and SEC filings. However, employers can change benefits at any time. Always verify your specific plan details through your company’s benefits portal or HR department before making any decisions.

This guide covers the major components: the Savings Plan (401k), the pension program, retiree medical, and how all the pieces fit together.

B2 Spirit

The Northrop Grumman Savings Plan (401k)

The Northrop Grumman Savings Plan is the company’s primary retirement savings vehicle. It’s administered through Fidelity and covers substantially all hourly and salaried U.S. employees.

How Much Does Northrop Grumman Match?

The company match depends on your tenure:

Less than 5 years of service:

100% match on the first 4% of your contributions
50% match on the next 4% of your contributions
Maximum company match: 6% (when you contribute at least 8%)

5 or more years of service:

100% match on the first 4% of your contributions
50% match on the next 6% of your contributions
Maximum company match: 7% (when you contribute at least 10%)

Let’s walk through a quick example. If you earn $150,000 and have been with Northrop for 6 years:

You contribute 10% ($15,000)
Northrop matches 100% of the first 4% ($6,000) plus 50% of the next 6% ($4,500)
Total company match: $10,500, or 7% of your salary

If you’re contributing less than the amount needed to capture the full match, you’re leaving compensation on the table. At minimum, contribute enough to get every dollar of that match.

Vesting

Company matching contributions vest after 3 years of service. If you leave Northrop before completing three years, you forfeit the unvested employer match. Your own contributions and any rollover amounts are always 100% vested from day one.

How Much Can I Contribute?

You can contribute to the plan on a pre-tax, Roth, or after-tax basis. For 2026, the limits are:

Contribution Type	Under 50	Age 50-59	Age 60-63	Age 64+
Employee Deferral	$24,500	$24,500	$24,500	$24,500
Catch-Up	—	$8,000	$11,250	$8,000
Total Employee Max	$24,500	$32,500	$35,750	$32,500
Overall Plan Max (incl. employer)	$72,000	$80,000	$83,250	$80,000

SECURE 2.0 change for 2026: If you earned more than $150,000 in FICA wages in 2025, your catch-up contributions must be made as Roth. Pre-tax catch-up contributions are no longer allowed above that income threshold. This will affect many Northrop Grumman engineers and managers.

The Mega Backdoor Roth

The Northrop Grumman Savings Plan allows after-tax contributions, which opens the door to the Mega Backdoor Roth strategy.

Here’s how it works: after you’ve maxed out your pre-tax or Roth employee contributions (and any catch-up), you can make additional after-tax contributions up to the overall plan limit of $72,000 (including employer match). Those after-tax dollars can then be converted to Roth within the plan using Northrop’s in-plan Roth conversion feature.

This is a powerful way to get significantly more money into a Roth account than the normal contribution limits allow. For a high-earning Northrop employee under age 50 who maxes out the employee deferral at $24,500 and receives $10,500 in company match, that leaves room for approximately $37,000 in after-tax contributions that can be converted to Roth.

A few important notes:

Any earnings on the after-tax contributions between contribution and conversion will be taxable. Convert regularly to minimize this.
Be careful not to front-load after-tax contributions early in the year, as this can crowd out the employer match. Spread contributions throughout the year or work with your payroll settings to ensure the match isn’t squeezed.
The plan uses Fidelity’s BrokerageLink for self-directed investing if you want access to a broader menu beyond the core fund lineup.

Roth vs. Traditional: Which Should I Choose?

The right answer depends on your current tax bracket versus what you expect your tax bracket to be in retirement.

If you’re in your peak earning years and expect your income to be lower in retirement, pre-tax contributions give you the immediate tax break when it’s worth the most. If you’re earlier in your career or expect tax rates to be higher in the future, Roth contributions lock in today’s rate.

For most Northrop employees approaching retirement, having a mix of pre-tax, Roth, and taxable assets provides the most flexibility. This gives you control over your tax rate in any given year of retirement, which becomes especially important when managing Required Minimum Distributions, IRMAA thresholds, and Roth conversion strategies.

What Can I Invest In?

The Northrop Grumman Savings Plan offers two approaches:

Path 1: Managed for you. Target-date funds that automatically adjust your asset allocation as you approach retirement. A reasonable choice for employees who want a hands-off approach.

Path 2: Build your own. A selection of core investment funds across major asset classes, including:

A stable value fund
Bond index funds
U.S. equity funds (large cap, small cap)
International equity fund
A balanced fund (roughly 45% U.S. stocks, 20% international stocks, 35% bonds)
Northrop Grumman company stock fund

For those who want access to a wider universe of investments, the plan also offers a self-directed brokerage account through Fidelity BrokerageLink.

One caution: be careful with concentration in Northrop Grumman company stock. Your paycheck already depends on the company. Putting a large chunk of your retirement savings in the same stock concentrates your risk. If the company hits a rough patch, both your income and your portfolio could be affected at the same time.

Can I Roll My Old 401(k) or IRA into the Northrop Grumman Savings Plan?

Yes, the plan accepts rollover contributions. Before rolling money in, compare the fees and investment options between your old plan and the Northrop plan.

One strategic reason to roll a traditional IRA into the 401(k): it clears out your pre-tax IRA balance, which is necessary to execute the Backdoor Roth IRA strategy cleanly. This is different from the Mega Backdoor Roth described above. The regular Backdoor Roth is a way for high earners above the Roth IRA income limit to still get money into a Roth IRA each year.

The Northrop Grumman Pension Program

Northrop Grumman offers a traditional defined benefit pension, but eligibility depends heavily on your hire date.

If you were hired before July 1, 2008: You are generally eligible to participate in the Northrop Grumman Pension Program. Your benefit is based on your years of service, age, and compensation. The specifics vary depending on which legacy plan you’re in (Northrop Grumman has absorbed several companies over the years, each with its own pension plan history).

If you were hired on or after July 1, 2008: You are generally not eligible for the pension. Instead, you may receive an additional company contribution in the Northrop Grumman Savings Plan on top of the regular match. This is Northrop’s way of compensating newer employees for the loss of the pension benefit.

For those with a pension, the key decisions at retirement are similar to other defined benefit plans:

Annuity vs. Lump Sum: The plan offers various annuity options (single life, joint and survivor) and may offer a lump sum. The lump sum is calculated using actuarial factors and current interest rates.
Early Retirement Reductions: Retiring before the plan’s normal retirement age typically results in a reduced benefit. The specific reduction depends on your plan and your age at retirement.
Survivor Benefits: If you’re married, the default payment form is a joint and survivor annuity. Understanding the pre-retirement survivor benefit (what your spouse receives if you die before starting your pension) is essential for planning purposes.

If you have a pension, you should call the Northrop Grumman Benefits Center (NGBC) at least 30 days before your intended retirement date to request your retirement kit, which will include your specific pension estimate and payment options.

Additional Company Contributions (Post-2008 Hires)

If you were hired after July 1, 2008 and aren’t eligible for the pension, Northrop Grumman provides an additional company contribution to your Savings Plan. This contribution is separate from the matching contribution and is designed to partially offset the absence of a pension benefit.

The amount and vesting schedule of this additional contribution can vary, so check your specific plan documents or contact the NGBC for details on your situation.

Retiree Medical Coverage

Northrop Grumman offers retiree medical coverage, but eligibility requirements and the level of coverage depend on your hire date, age, and years of service. Generally, you need to meet minimum age and service requirements to qualify.

For retirees who haven’t yet reached age 65, Northrop may offer access to a group health plan. Once you’re Medicare-eligible at 65, coverage typically transitions to a Medicare supplement or Medicare Advantage plan, often through a marketplace like Via Benefits.

The specifics of retiree medical change frequently. As you approach retirement, request a detailed summary of your retiree medical options from the NGBC so you can plan for healthcare costs in retirement. This is especially important for employees considering early retirement, since healthcare is often the largest variable expense between retirement and Medicare eligibility at 65.

How All the Pieces Fit Together

Retirement planning for a Northrop Grumman employee requires looking at these benefits as an integrated system, not as individual line items.

The Roth Conversion Window: If you retire before claiming Social Security, you may have several years where your taxable income is unusually low. This is the optimal window to convert portions of your traditional 401(k) or IRA to Roth, paying taxes at a lower rate than you would later when Social Security, RMDs, and potentially a pension kick in.

Pension + Social Security Coordination: If you have a Northrop pension, that’s guaranteed income. Combined with Social Security, it may cover a significant portion of your essential expenses. This changes how you think about your 401(k). Instead of needing the entire portfolio to fund your lifestyle, the portfolio may only need to fund discretionary spending and serve as a reserve for unexpected expenses. That has implications for how aggressively you invest and how much you withdraw.

Tax Diversification: Having assets in pre-tax accounts (traditional 401k/IRA), Roth accounts, and potentially taxable brokerage accounts gives you maximum control over your tax situation in retirement. If you’ve been using the Mega Backdoor Roth strategy, you may already have significant Roth assets, which is a strong position to be in.

Healthcare Bridge: If you’re retiring before 65, plan for the cost of health insurance between retirement and Medicare eligibility. This is often the biggest surprise for early retirees. Even if Northrop offers retiree medical coverage, understand the premiums and out-of-pocket costs so you can build them into your spending plan.

Where Do I Manage My Benefits?

Savings Plan (401k): Managed through Fidelity NetBenefits
Pension and Retirement Questions: Contact the Northrop Grumman Benefits Center (NGBC)
Retiree Medical: Contact the NGBC as you approach retirement for current plan options

I’m About to Retire. What Should I Do First?

Accumulating money is one thing. Turning it into reliable income that lasts 30+ years is a different challenge entirely.

How much can you safely spend? Which accounts do you draw from first? How do you coordinate a pension, 401(k), and Social Security while minimizing your lifetime tax bill?

These questions don’t have one-size-fits-all answers. Getting them wrong can mean retiring later than you planned, running out of money, or overpaying the IRS by hundreds of thousands of dollars over your lifetime.

At 7 Saturdays Financial, retirement income planning is our core focus. We specialize in helping pre-retirees and retirees build comprehensive plans that address investments, spending strategy, tax efficiency, and the peace of mind that comes from knowing you have a plan that’s prepared for whatever life throws your way.

We’re a fee-only, flat-fee firm with no products to sell and no incentive tied to which funds you hold or which pension option you choose. Our only job is to help you retire with confidence and spend with clarity.

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About the author: Allen Mueller, CFA, CFP®, is an “engineer turned finance nerd” and founder of 7 Saturdays Financial, a wealth management firm based in Dallas, Texas.

The core focus of 7 Saturdays Financial is helping high performers retire with confidence and make the most of their 7 Saturdays a week.

Visit www.7saturdaysfinancial.com to learn more. And be sure to check out the team’s ⭐⭐⭐⭐⭐ reviews at Wealthtender!

Note: this article is general guidance and education, not advice. Consult your money person or your attorney for financial, tax, and legal advice specific to your situation.