Originally Posted by
BlackKnight
I asked this EXACT question at one of the Q&A meetings recently: does the 1% bumps(s) make up for the value I'm losing due to no change in the A plan value. Did they run an analysis for any seat, and carry it out 6 years (I know, more like 8 to 10) and compare rough numbers and/or value(s). They answered yes. I'm skeptical, but I have yet to run my rough numbers. I'll let you know when I do.
Hmmm....
I'd love to see that analysis, with ALL the specific assumptions
Current years of service, current seat, assumed upgrade time, age, deflator on fixed A fund value, assumed rate of return on B fund contributions, age at retirement, assumed life expectancy etc
And the sensitivity analysis associated with those assumptions
I believe UPS DB plan is 1% x 30 yrs (max) x High 5 FAE
What's their cap on High 5?
I'm pretty sure it yields less than our current DB max of $130K -- 50% of $260K
However, they have a much higher B plan (Defined Contribution)
UPS - 12% vs Fedex - 7%
Where's our "end game " B fund goal as the $260K cap causes our A fund to deflate over the long haul??
My guess is the two 1% B fund bumps were more of a "band aide" fix for appeasement, and the overall, long term, equivalent solution is kicked down the road a few years
Please show us the math