Only at FedEx would pilots be arguing For a Mgt proposal to eliminate the A plan after being vehemently Against a Union proposal to modify the A plan benefit calculation.
Out of fears the benefit would go to 0 in an underperforming market environment, but be ALL in for a Cash Over Cap B plan only that is Solely dependent upon market returns.
In 2020, a FedEx pilot can contribute $19.5k to our 401k. DC limits are $285k salary and a maximum of $57k can be deferred (not counting the Catch-up provisions)
So, for our Super Saver FedEx pilot there is $37k of Company contributions available before everything is taxed.
That is roughly $246k.
After than Government's taking a minimum of 25 dollars for every 100 dollars of income. I know, 1st world problems. But then they're also going to be taking a cut on any returns you earn on that 75 dollars every pilot would hypothetically be saving.
But study after study shows that most of the time when the money shows up in a paycheck it gets spent. How many DAL guys do you know saving their Profit Sharing each and every year?
Yet that was the argument DALs NC put together in their video a few years back. Compared DAl versus UPS and said that if they achieved roughly 4.6% pay increases (they didn't, only got 3% over the past 2 years) and if PS continued at the same rate over a career, and a DAL pilot saved every dollar (without deducting any lost to extra taxes) that a DAL pilot and a UPS pilot would have equivalent retirements.
And Yes, you can make the math work out that you're actually better off with a big B plan versus our $130k A plan and 9% B plan. But if you're capable of achieving the kind of investment return doing so requires, over 25 years, you're wasting your life as a Pilot. Wall street will pay you Millions of dollars to do that.
And Yes, if you die a year after retirement a Big B plan would've been way better.
At least you can leave the money to your heirs.
But planning to die early isn't much of a retirement plan