Brennan Decima, CFP®. October 8th, 2025
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Pfizer has long been recognized as an outstanding employer—known for innovation, culture, and a strong commitment to employee well-being. One of the most overlooked parts of its benefits package is the Pfizer Supplemental Savings Plan (PSSP), a deferred compensation plan designed for high-income employees who want to save beyond the 401(k) limits and reduce taxable income.
With it’s great culture, powerful mission, commitment to innovation, and top notch benefits package, it offers an excellent opportunity for clients to build careers and set their family’s up for retirement peace of mind.
However, understanding the benefits package can be a little confusing.
Most colleagues are familiar with the 401k and the company match, but for high income earners, there is a powerful benefit that they may not be fully taking advantage of. The Pfizer Supplemental Savings Plan, also known as the PSSP.
The Pfizer PSSP is a deferred compensation plan designed to help high income employees save more for retirement on a pre-tax basis. When the 401k limits are met, the PSSP allows employees to continue saving, and continue receiving company match.
The good news? With the proper planning, you can take smart steps to further reduce your tax bill, save more for retirement, and get more company match each year.
In this guide, we’ll walk through key strategies every Pfizer colleague should know – from understanding how the PSSP works, to planning your withdrawals with tax efficiency in mind.
Whether it’s your first year eligible for PSSP, or you have been participating for years, this article will equip you with the clarity and confidence to navigate Pfizer open enrollment.
Key Takeaways
- The Pfizer PSSP is a deferred compensation plan available to high income employees
- It allows you to save more for retirement on a pre-tax basis
- The Pfizer PSSP allows you to receive more company match
1. Understanding the PSSP
The PSSP is a deferred compensation plan. What is Deferred Compensation? Deferred Compensation allows you to continue to defer income into a savings account for retirement above and beyond the 401k limits. There are no IRS limits on the amount you can put into deferred compensation.
i. How much does Pfizer let you contribute?
Pfizer allows you to contribute up to 30% of eligible compensation.
ii. What is eligible compensation for the Pfizer PSSP?
Pfizer eligible compensation includes your salary and annual bonus. It does not include your long term incentives.
iii. How much does Pfizer match in the PSSP
Pfizer matches 100% on the first 3%, and 50% on the next 3%. If you are contributing at least 6% to the PSSP you will receive a 4.5% match.
2. Who is eligible for the PSSP
Pfizer allows high income earners to participate in the PSSP. In 2025, the definition of a high income earner is an individual making at least 350k in eligible compensation.
i. I didn’t receive 350k in eligible compensation, how did money end up in my Pfizer PSSP?
If you did not make 350k in eligible compensation, you may still notice funds in your account. This typically occurs one of two ways. Either through company contribution, or as someone who is projected to earn excess compensation.
ii. Pfizer RSC or Match
In 2025, the 401k limit for employee and employer contributions is 70k. If your total contributions have reached 70k for the year, some colleagues receive an RSC contribution that is put into the PSSP.
iii. PSSP Trigger
Pfizer also says that an employee who is eligible for PSSP that was also eligible the prior year will have a determination based on their Employees Qualified Plan Elections in effect on December 31st of the previous year. What the heck does that mean?
Pfizer looks at when the employee was projected to exceed the contribution limitations based off year end elections. For example.
- The annual 401k in 2025 is 70k.
- On 12/31 your contribution election for the 401k is 20%
- Pfizer matches 4.5%
- Take 70,000/(.245)
- 285k is the amount where you are projected to hit the limitation. Once your income reaches 285k, your contributions to the 401k will stop, and they will now be directed into the PSSP
Want Help Calculating Your Trigger?
3. Who should consider the PSSP
The Pfizer PSSP is designed for high income earners that are looking to save more for retirement on a pre-tax basis than the 401k allows them. If you are looking to save more than the 401k limits, the PSSP may make sense for you.
The order in which you draw down your retirement accounts can have a significant impact on your total tax bill over time. By being thoughtful about timing and account types, you may be able to reduce the taxes you owe—both now and later in retirement.
4. What should Pfizer colleagues consider when they enroll
i. Contribution Election Can’t Be Changed During the Year
It is incredibly important for Pfizer colleagues to make sure they have a good understanding of their liquidity and income needs for the following year. Once they opt into the PSSP, they are not able to change the amount until open enrollment the following year.
ii. Distribution Elections Should Be Carefully Planned
The Pfizer PSSP allows for a lump sum distribution or annual installments. The Installments can be either 2 years up to 20 years. The PSSP funds can’t be rolled over in to an IRA. If you decide to make a change to the payout, be careful.
- The change to distributions needs to be made at least 12 months before leaving Pfizer
- If you do decide to make a change, the payout gets pushed out 5 years. For example, if you initially chose a lump sum, but want installments, the first installment would not start until 5 years after you would have received the lump sum.
iii. Taxation on Distributions Depends on Election
If you take a lump sum, or an installment option less than 10 years, the income will be taxed in the state it was earned. For example, if you worked in New York, but move to Florida in retirement, you would still owe New York State taxes on the lump sum or if the installments are less than 10 years.
If you choose to take installments greater than 10 years, the income will be taxed in the state you reside.
4. What is the benefit of the PSSP
If you are a high income earner, chances are you are in a high tax bracket. The PSSP allows you to reduce your taxable income by up to 30% of your eligible compensation. This lowers your tax while you are in a higher bracket. By paying less taxes while you are working, this allows more dollars to be compounding for retirement. For many colleagues, they are in a much lower income tax bracket when they retire, so the distributions potentially come out at more favorable income rates.
5. What if I need help modeling the contributions and distributions in my financial plan?
We help Pfizer colleagues with detailed retirement planning to help them optimize taxes both when they are working and in retirement.
Tax planning for retirement is rarely a DIY job. A qualified advisor can help you:
- Navigate complex rules across income, property, and estate taxes.
- Create a year-round plan to avoid last-minute surprises.
- Coordinate with your CPA or estate attorney for an integrated approach.
Look for someone who understands both your benefits and personal tax situation that can help you plan proactively, not just reactively.
Working for Pfizer offers many rewards; however, without thoughtful planning, a portion of your income could be lost to unnecessary taxes. From benefit enrollment to withdrawal strategies, there are many ways to minimize your tax burden. Taking advantage of the Pfizer Supplemental Savings Plan is one way to potentially optimize your planning.
The earlier you begin planning, the more flexibility and control you’ll have. And if you’re unsure where to start, consult with a Fiduciary who can help you navigate both the numbers and the nuances of Pfizer’s benefits.
Schedule your free consultation.
Frequently Asked Questions about the Pfizer Supplemental Savings Plan (PSSP)
1. What is the Pfizer Supplemental Savings Plan (PSSP)?
The PSSP is a deferred compensation plan that allows Pfizer’s high-income employees to contribute up to 30% of their eligible compensation after 401(k) limits are reached.
2. How does the Pfizer PSSP differ from a 401(k)?
The PSSP isn’t subject to IRS contribution limits, allowing additional pre-tax savings and extended company match benefits.
3. Can I roll over my PSSP funds after leaving Pfizer?
No, PSSP funds cannot be rolled into an IRA. Distributions are taxed as ordinary income based on your election and residency.
4. How are PSSP distributions taxed if I move to another state?
If you take installments under 10 years, income is taxed where earned; installments over 10 years are taxed where you live in retirement.
5. Who can help me plan PSSP contributions and withdrawals?
A fiduciary financial planner experienced with Pfizer’s benefits can help model tax scenarios and optimize your overall retirement income plan.
