Originally Posted by
FangsF15
The 5 year lookback window (vice 3) is a nice feature.
How does the tax free option work/differ? Always looking for incremental improvements. Are you saying that you made $60k a month for a year? What’s the detail on “best” of last 5 years?
Agree the DC contribution basically staying at a level ‘as if you were still active’ is a massive win for both of us.
Tax free option is a federally mandated imputed income. It’s based on our November hourly pay rate (from the previous year, so especially beneficial to upgrading FOs), regardless of number of hours paid. So for the high earners and recent upgrades it’s a very good deal. I pay my marginal tax rate on ~$600/check for the tax free option. It’s the same every check, no matter the gross.
Detail on best of 5 previous calendar years (or previous 12 months, whichever is higher) is basically everything that earns pay. Excludes per diem (obviously). All the same things you mentioned including our second to none profit sharing, haha. Only (potential) downside is the 401k is paid as cash if you opt for the tax free option, because you have no taxable earnings to contribute to a 401k. But low tax rate brokerage cash is not the worst thing in our line of work, especially if you want to retire before 59.5.
Got ahead of myself with poor formatting. The $30k/mo would be including the 401k. I’ll edit for accuracy (nevermind, won’t let me edit).