Originally Posted by
kronan
“We” do not exist in a Direct Democracy, but instead elect Representatives.
Our Representatives have said they’ve considered various options over the past 2 years and have settled on this one as the most beneficial.
If YOU, want to participate in evaluating every option and have 100% of the information...there’s an easy solution.
Confident it can be a bit time consuming, and occasionally frustrating.
What say you Albie15 and TonyC
Originally Posted by
kronan
Umm, no.
Here are some quick and dirty numbers. Assumptions on a 30 year career, 3 as NB FO, 3 as WB FO, 9 as NB CAPT, rest as WB. Assumes NO raises after amendable date of our contract. Assumes 6% return.
After 30 years, our notional newhire @ 16% should accumulate roughly 3.2M which equates to a 128k payout (remember, any raises in 5 years will only Increase that number)
@20% should accumulate 3.97M = 159k
I do like the 30%, that winds up at 5.96M = 234k
And, no, none of those numbers take into consideration our 8/9% B plan. While not estimating any future code increases (B plan limit goes to 275 next year)
Our newhire should accumulate 1.8M = 72.2k in the B plan
Just my limb here...but I’m thinking there might, just might be some desire once the numbers start coming out. Especially if it includes a lump sum option (my wag on lump sum option would be about 70% of the 3-5M accumulation...remember, it’s a hypothetical accumulation that generates an annual pension but it never actually draws down to 0 the way our B plan can)
Considering FedExs experience with the straight cash balance plans for our support folks, surprised they’re still sitting on our modified cash balance concept. And that’s all it is at the moment, words from my rep some time ago indicated that the 1st concept ppt show we received is what they presented to the company.
Specific details will be waiting on polling from us if mgt decides they’d like to enter negotiations.
Where to start?
First, our current A plan earns its full benefit at 25 YOS. So if you want to compare apples to apples, you need to run your numbers for 25 years.
Second, how much do you think the company contribute per pilot to the A plan annually? It is proprietary information, so we will never know an exact number, but a good estimate would be between $25K and $30K per year. At the current pay scale, a second year NB FO would get a $22.5K contribution at your 16% of pay rate. Over a 25 year period with our pay going up every year, a 16% of annual pay contribution would cost the company 2-3 times what it contributes right now. If they can afford that, why can't they afford to simply increase our current A plan benefit?
Third, your plan totally disregards QOL in your upgrade plan. What kind of line can a 7 year NB captain hold? How about a 15 year NB captain? What about a 16 year WB captain? A 15 year NB captain is still in the bottom 50% of the bid pack and a 16 year WB captain is in the bottom 80% of the bid pack. That sounds like a great way to live.
Finally, where do you come up with a 6% ROI? Most experts recommend a conservative mix on cash balance plans. A common recommendation is to put 50% of the investment in the US 10 year bond. The remaining 50% is diversified between other securities and equities. The current 10 year bond yields just under 2.5%. So, the other 50% would have to yield 9.5% on average to get your 6% ROI. Considering that the DOW has averaged about 7% ROI over the last 30 years, the recommended investment falls short of your 6%.
Considering your other statement above, I don't know why you are even discussing a 16%-20% cash balance plan. Our elected representatives have already made their decision.