Originally Posted by JustInFacts

Thanks for that Viper. There are a few items that do need to be pointed out for comparison purposes.

First, Stevie's career is 35 years. At Fedex, the pension is maxed out at 25 years. Using the 4% withdrawl that you used, that pension would be worth $4.225 million.

On top of the pension, Fedex also gets a 9% DC plan. In 25 years, that plan could easily be worth $2.3 million using the same 7% ROR. The total worth of the two plans in 25 years is $6.525 million compared to the $7.97 million achieved in 35 years.

The numbers you used also account for pilot contributions of their own money, while the numbers above for Fedex were only company money. If you add in the a pilot contributing to their 401, that increases the amount by $1.6 million. That total in 25 years is now $8.125 million.

These numbers don't include the potential for a Fedex pilot to have 15 years of excess disability payments going into the plan which would increase the company money added or decrease the pilot money added which could be invested elsewhere.

Originally Posted by Westerner

Wow...the retirement plan looks great, even with the current pension value. Why were we trying to "sell the farm" for improved retirement in TA1?

Originally Posted by Moneybags

Because a fixed 130k pension will be worth at best 65k 25 years from now. And increasing it costs a lot of money due to its inefficiencies and funding rules associated with it. So it weighs down gains in our contract in other places, like pay and QOL.

Increasing a DC % is much easier. Also, by the nature of a DC%, with an increase in pay, you get an increase in retirement contributions. The pension requires negotiating the FAE cap every contract.

Also, dividing a pension by 4% to determine the lump sum is not accurate. Use an annuity calculator instead.

Originally Posted by Westerner

The pension increase was designed to help those retiring now, not retiring in 25 years. Most of the TAs value was for the group that had already banked everything the previous poster described. The NC Chair described it as unconscionable for that group to retire without the additional gains of TA1.

Originally Posted by BoilerUP

A $6600/YOS Flat Dollar Amount, increased $200 every DOS+, would match the TA1 benefit with much lower funding requirements. That would allocate more "pie" toward a higher defined contribution percentage, cash-over-cap, and industry standard payrates.

"Something for everybody" without deepening fracture points within group unity.

Originally Posted by Moneybags

Please explain how this works compared to your baseline pension pay (I think 1% per YOS vs our 2%). What you’re describing sounds like an accounting trick. How is your retirement protected if the funding isn’t there for it?

Originally Posted by BoilerUP

I'm not a retirement expert, but here's my understanding:

Everybody is funded for the contratual 1% FAE.

The FDA benefit only applies (and is funded) for people turning 60 within 10 years of ratification which is an ERISA (or IRS?) requirement, and therefore the FDA applicability "runway" must be extended every contract cycle. That requires use of negotiating capital, sure, but after the FDA was negotiated in our Contract 2006 it has been extended/increased in 2016, 2020 and 2022.

FDA is a unique way to provide a decade-long bump in defined benefit in a way that doesn't have funding requirements that are cost prohibitive for overall contract value.

Originally Posted by M77CA

This is youre own fault. I go back to my house and not sit in AOC. I didn’t get to live in the bigest house in Eads by complaining. I showed up and pressed on.

Originally Posted by JustInFacts

Thanks for that Viper. There are a few items that do need to be pointed out for comparison purposes.

First, Stevie's career is 35 years. At Fedex, the pension is maxed out at 25 years. Using the 4% withdrawl that you used, that pension would be worth $4.225 million.

On top of the pension, Fedex also gets a 9% DC plan. In 25 years, that plan could easily be worth $2.3 million using the same 7% ROR. The total worth of the two plans in 25 years is $6.525 million compared to the $7.97 million achieved in 35 years.

The numbers you used also account for pilot contributions of their own money, while the numbers above for Fedex were only company money. If you add in the a pilot contributing to their 401, that increases the amount by $1.6 million. That total in 25 years is now $8.125 million.

These numbers don't include the potential for a Fedex pilot to have 15 years of excess disability payments going into the plan which would increase the company money added or decrease the pilot money added which could be invested elsewhere.

Originally Posted by JustInFacts

Thanks for that Viper. There are a few items that do need to be pointed out for comparison purposes.

First, Stevie's career is 35 years. At Fedex, the pension is maxed out at 25 years. Using the 4% withdrawl that you used, that pension would be worth $4.225 million.

On top of the pension, Fedex also gets a 9% DC plan. In 25 years, that plan could easily be worth $2.3 million using the same 7% ROR. The total worth of the two plans in 25 years is $6.525 million compared to the $7.97 million achieved in 35 years.

The numbers you used also account for pilot contributions of their own money, while the numbers above for Fedex were only company money. If you add in the a pilot contributing to their 401, that increases the amount by $1.6 million. That total in 25 years is now $8.125 million.

These numbers don't include the potential for a Fedex pilot to have 15 years of excess disability payments going into the plan which would increase the company money added or decrease the pilot money added which could be invested elsewhere.