Originally Posted by
sailingfun
Ok, Here is a actual pilots benefit who was 50 at termination.
Frozen plan was 96000 per year
Recovery.
PBGC plus stock recovery. 55,200 per year
Note money 323,000
MMPP money 112,000
DC contributions. 260,000- 10 years at 26,000 average per year. 200k average income
Total cash 435,000. Total tax deferred 212,000
10 years for this pilot to retire at 60 rule of eight money should more then double. Total should be close to between 800k and 1 mil at age 60 plus another 350 to 450,000 from DC contributions. base amount of 260,000 plus investment earnings.
So he had a 96,000 a year benefit. He will get 55,200 from the PBGC and have somewhere between 1.1 and 1.5 million in cash at age 60 with modest earning assumptions.
Again lets be serious? Pennies on the dollar? I don't think so. In fact on the Dalpa forum some of the most anti ALPA pilots have reported they believe they will do better then the frozen benefit.
One last point. I did not include a dime of the claim money or merger stock. Add that in and it gets even better but as mentioned those payments were for contract concessions.
While it pains me to somewhat agree with sailingfun, I think he has a point about the retirement situation. For me personally, I think I'm going to have at least as good a retirement as I would have had with the pension. And I'm assuming the PBGC won't even be there, i.e. insolvent. Now the kicker is that this is based on assumptions of the return I will continue to get. I feel comfortable that my assumptions are accurate, but who knows? And the other thing is that I will have to go to age 65 to make the numbers work.
For the more junior pilots among us, I think it's a no brainer. If I were 20 or 30-something, I would MUCH rather have our current retirement setup than a DB pension! Actually, even at 51, I prefer this. I just wish I hadn't had to more or less start over with building my retirement halfway through my career.
This is just my opinion (and take it FWIW because you know what they say about investment advice from a pilot), but our BrokerageLink is extremely valuable and is the real key to making this work out. A person has to know what they are doing, but it is possible to get a much better risk adjusted return than what you are likely to get with the typical diversified mutual fund portfolio.
Now the standard of living and overall value of our careers is a whole different topic. We are massively behind in terms of compensation and the stability of our jobs continues to be threatened by scope issues. We need significant restoration to make our standard of living comparable to what most of us reasonably expected when we got into this career. That is going to take some real leadership, vision, and fortitude. I cannot at all agree with the idea that what we have now is the new norm and that we should expect traditional increases from there. Unfortunately, with the current DALPA mentality (which is exhibited by sailingfun), I don't see how we could ever possibly get to where we want to go.