Originally Posted by
TonyC
We already have pilots hitting the 415(c)(1)(a) contribution limits. That makes the effective rate of their "B" Plan ZERO percent for the rest of the year. If we're going to put effort into improving the "B" Plan, we have to tal
k about Cash Over Cap features. When we get to that point, we may as well switch the conversation back to pay rates.
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Guys can hit the IRS income cap using their own money. Increasing the B fund even without cash over cap means that guy can hit the cap with less of this money. That money can be put in other retirement vehicles, investments or spent by the pilot. Too many people say a B fund increase without cash over the cap doesn’t help a WB captain and that is just false. Every percent increase is $2700 towards the IRS limit that doesn’t come out of the pilots pocket. Not that we would get it in addition to our existing A fund but a 20% B fund would nearly hit the IRS cap $55000 (age <50) with all company money. You wouldn’t need to put your money in if you make $270k. A guy who makes less than $270 would hit the $55k savings cap earlier in your career using less of your money.