Originally Posted by
UnusualAttitude
The modeler’s numbers, which have yet to be negotiated, are used for illustrative purposes only. You know that.
Our current plan does have a formula which is guaranteed, a floor, though it isn’t universal in nature. The product of the formula is based upon the variables a pilot can enter.
Your statement is misleading, I won’t presume your intent.
-UA
the Proposed plan, has a Formula which would be guaranteed.
Each and every year, a Pilot's earnings would go towards that guaranteed level of benefits.
The Product of the formula, will calculate a pension benefit. A pilot can assume the Company's Investment guru's will continue to earn the 6.5% they currently predict on our Pension trust. Or you can assume lower. In either case, the predicted benefit will show two components over on the far side of the model that indicate the likely annual Pension. Bottom component is the floor, next one up is the most likely band. (EG the one I just ran for a newhire with a potential 30 year FedEx career shows $218k for the floor and another $16k for the first band with a predicted return matching the hurdle rate of 5%)
Where it Doesn't produce accurate numbers is if someone works 65% of the time.
But, it's darn risky to simply work 65% of the time because your LTD is based on that rolling income.
And, God forbid you should be minding your own business at a traffic light and have someone slam into you and you lose your medical.
Or, you develop cancer or any of the multitude of diseases that mean no more FedEx flying for you.
Your High 5 is whatever you have in hand while working that 65%.
Assuming you stay healthy, a Traditional A plan benefit calculation is Far superior to that of the year by year VB plan calculation.