Originally Posted by
FDXLAG
No we are at 9% in 2020. Yes we are at 8% now. I use 9% just like I use 4200 when talking about you multiplier for retirement. It is what it will be eventually. The B Fund caps are not tied to the percentage in the contract. Otherwise you could negotiate a 100% B fund and cap it out at 260K. The B fund cap (at least when I talk about it) is the 54K (I think, 56 if over 50) limit on max contributions for 401K and B Plan limits. I am not sure what your contract allows for 401K contributions so I can't answer what your real B fund cap is. I do know that B fund contributions don't stop when you hit 260K of income but when you hit the IRS limit.
I got the 50 K by adding up the difference between 8 and 12% over the first 10 years of employment at our respective companies. It is just a wag probably low. But like I said we will have guys on 3rd year pay making 200+ an hour, that will even out the 8% vs 12% pretty quickly.
Not a pi$$ing contest, Your TA is probably a good one. Best of luck however you vote. Ours contract did not make anyone happy, but it is not as bad as some would let on.
I'll never bet my paycheck as I'm never 100% certain of anything!
But, I do think our current 8% stops completely when you hit (this year) $265,000 in income. Any income earned over that IRS cap gives us zero B fund benefit. That's why cash (vice B fund contribution) over this cap is a feature both UPS and FedEx miss in their contracts.
If you'll recall the NC put out a primer on this shortly after the CBA came into force. They explained the "safe" level of after tax 401(k) contributions so you wouldn't hit the $54k cap ($53k?...going off of memory here). They took B fund 8% x $265,000 added in your $18k Max 401(k) contribution added in the DSA over 686 payout and showed the max after tax 401(k) you could safely stash away was 5%. Over that 5% level you would have to figure out if you were going to get DSA over 686 to see if you could increase your after tax amount. This is a quick and dirty explanation without looking back at that product. Perhaps someone who isn't on their iPhone could find that and post the accurate info?
Remember the $265,000 IRS limit and $54,000 IRS limits are two different things, but related in retirement planning.