Market Based Cash Balance Plan
#41
Gets Weekends Off
Joined APC: Jun 2015
Posts: 4,116
As of now what is being put out by our 'experts' is based on an unapproved proposal.
I would suggest one base their thinking and analysis on the existing approved plan language in the government source documents.
We are not a business owner...so we will not hold the dbcb trust as a principle. It will be held by a sponsor...likely our employer.
Any car sales sales pitch only highlights the good. I didnt read a single point in that press release that cited not one potential liability or risk.
Thats not reality.
If im trying to sell you a tax dodge the pitch of 'incremental' rate on the component im trying to squeeze out of the mark is highly effective.
An individual pays a net effective rate. The last dollar earned is taxed at the highest bracket achieved.
But that last dollar rate is balanced and offset by the first dollar of earnings which is taxed at the minimum rate.
Im 100% certain most tax filers pay a net effective rate less than the rate on the last dollar of earnings.
I would suggest one base their thinking and analysis on the existing approved plan language in the government source documents.
We are not a business owner...so we will not hold the dbcb trust as a principle. It will be held by a sponsor...likely our employer.
Any car sales sales pitch only highlights the good. I didnt read a single point in that press release that cited not one potential liability or risk.
Thats not reality.
If im trying to sell you a tax dodge the pitch of 'incremental' rate on the component im trying to squeeze out of the mark is highly effective.
An individual pays a net effective rate. The last dollar earned is taxed at the highest bracket achieved.
But that last dollar rate is balanced and offset by the first dollar of earnings which is taxed at the minimum rate.
Im 100% certain most tax filers pay a net effective rate less than the rate on the last dollar of earnings.
#43
Gets Weekends Off
Joined APC: Apr 2018
Posts: 2,987
I'll bet my whole retirement that if I took the excess 401k DC cash and invested it in an s&p index I'd have significantly more money when I retire (after tax) than if I were to do this MBCP.
Maybe for guys with less than 10 years until retirment MBCP is appealing but anything more than that it's not worth it.
Maybe for guys with less than 10 years until retirment MBCP is appealing but anything more than that it's not worth it.
#44
Gets Weekends Off
Joined APC: Jun 2015
Posts: 4,116
I'll bet my whole retirement that if I took the excess 401k DC cash and invested it in an s&p index I'd have significantly more money when I retire (after tax) than if I were to do this MBCP.
Maybe for guys with less than 10 years until retirment MBCP is appealing but anything more than that it's not worth it.
Maybe for guys with less than 10 years until retirment MBCP is appealing but anything more than that it's not worth it.
So ill say thanks now to all you young pilots for kicking in the dough from your paychecks.
#45
Gets Weekends Off
Joined APC: Jan 2008
Position: 320A
Posts: 333
I have not see anything in print from ALPA on this,but numerous sources that speak about cash based plans state you receive a statement at the end of each year.
https://www.emparion.com/cash-balance-plan-pros-cons/
https://www.emparion.com/cash-balance-plan-pros-cons/
#47
I have not see anything in print from ALPA on this,but numerous sources that speak about cash based plans state you receive a statement at the end of each year.
https://www.emparion.com/cash-balance-plan-pros-cons/
https://www.emparion.com/cash-balance-plan-pros-cons/
#48
That remains to be seen. I would suspect one would be able to look and see what their balance is at pretty much any time.
I realize a lot of pilots on this forum are investment gurus or at least know what they are doing in the market. I also think there are many more pilots out there that do not.
Denny
I realize a lot of pilots on this forum are investment gurus or at least know what they are doing in the market. I also think there are many more pilots out there that do not.
Denny
#49
Gets Weekends Off
Joined APC: Oct 2017
Posts: 162
Fees are generally the killer in cash balance plans. Buyer beware. And they're typically used by partnerships where the owners and employees are one in the same, and approaching retirement. A real benefit is the ability to roll it over to an IRA when you go. The risk by the sponsoring company to have to make up any returns below the target return makes the scheme less appealing to corporations. Sounds like some good salesman have gotten ahold of your reps. Will be interesting to see if Delta is supportive. Probably best to hang your hat somewhere else..
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