Section 6 thoughts
 

Guys,

Since we are in section 6 negotiations, I wanted to start a thread discussing some of the issues that come up every section 6.

What are you willing to give up for that? Nothing. The company had no problem reducing costs quickly and at huge levels when it behooved them. BK is long gone and we should bargain for and expect our costs to increase. The company will put out the usual memo about keeping costs increases down - that is their job. Our job is to increase our compensation.

Think pattern bargaining. Hopefully UAL will set the stage. This does not mean that every part of our PWA will lead the industry - it certainly will not, but with our current level of profitability we should be in the top tier in most sections and should not lag in any. Vacation and DH quickly come to mind. I am sure that there are others.

PS should not be touched. If anyone says we should trade PS for pay-rates or anything else, please enlighten them to the numerous reasons that this this is a fools errand. Due to pattern bargaining pay rates will normalize. Trading PS for payrates is just giving away PS over time.

Speaking of payrates I hear plenty of folks lament our rates as industry standard. That’s fine but when we set them they were industry leading. UAL and AMR matched us so we could have gotten 10% more and it would still be industry standard if other airlines match us.

Plenty of folks will claim an automatic “No” vote ready to go for certain issues. While I have no problem with that since many of the 14K Pilots will have different priorities I prefer to look at the contract as a whole. Make no mistake the value of our PWA will go up, costs for DAL will go up - other than the airline industry this is called a raise. We are due for a raise.

If I could stress one point it would be that every PWA gain does not have to be “paid” for by other PWA concessions. Yes, this is a negotiation so we will have to negotiate, and the company will have their wants but in total we should be aiming for big overall gains.

Scoop

Section 6
 

Ed Bastion is a very smart businessman. He will not spend a dime he doesn’t have to. He’s extremely firm on this. ALPA, on the other hand, bends quite easily as demonstrated by the gutting of our retirement, thus rendering this an unsurvivable career choice by all Deadzoners and a severely reduced prospect for future generations.

Unless the pilot group is educated...SERIOUSLY EDUCATED, on the workings, philosophy, and tactics of self help, no meaningful steps toward restoring the profession will occur. I haven’t seen any evidence of that since letter 51.

The company is comfortably, yet firmly in control and as each one of us turn 65 with insufficient means of survival, we will have our own individual reflection as we look over our shoulder at this magnificent airline while escorted off the property for the last time.

A strong union with formidable unity as a priority could have achieved snap-backs at the least.

You do not have the means to survive at 65?

Hi Tim,

I guess that depends on how you look at it. I’ve had one modest wife. I still live in the long paid for $89,000 house I bought on the B scale. My few toys have made money. Two kids. One ran a full ride scholarship. Second is still at home.

After the PBGC, claim, and note are accounted for and the hundred grand minimum I’ve usually added on top of my 401k, a 4% draw on all of my nest eggs equal FAE 12% but the year isn’t over yet so final math is yet to come.

What totally boggles my mind is how much better off I am than most of my peers. A snap shot from today means happy 65th birthday is sudden unemployment and a 88% cut in pay if I maintain discipline. Obviously the current rash of Greenslips runs those numbers toward the lower side but my goal of FAE 25% that I set after the bankruptcy simply isn’t happening in my life.

I strongly suggest everyone get a Fidelity advisor or equivalent. Look at your numbers guys. How are you really doing? Are you using ALPA R&I actuarial data that requires you to die in a timely fashion so the math looks less embarrassing? Is anyone really ok with that?

https://www.marketwatch.com/story/this-is-the-average-401k-savings-by-age-2019-01-31

Mid 30’s here with just over $340,000 in my 401k. I think I’ll be OK all things equal. I aggressively saved in my 20’s and I have been at Delta for my 30’s socking away on average about $40,000+ for the last few years.

Granted I was buying a lot during the recession and have enjoyed some pretty solid gains during that time (50% S&P/50% blue chip growth funds)..... the power of dividends does not go unnoticed. DL’s 16% + my own contributions have been noticeable as well. MY concern is the government finding different ways to spread the wealth as I get closer to my retirement.

If you work at Delta, live in a paid off $89,000 house, and can’t survive in retirement.... there are deeper issues. I just bought my first rental property a couple of years ago for $74,000, fixed it up, rent it, and it’s almost paid off with aggressive payments.

We need to meet or exceed our peers in many QOL items (vacation, training, etc.). The OP had a great post.

Considering the Pilot group resoundingly shot down TA-1 I think you are being a little pessimistic. And your Ed Bastion comment above reminds me of the “Richard Anderson said if we reject TA-1 we will get far less” comment last time around. How did that work out?

Yes our CEO is a smart man but guess what? The market for Pilots has more to do with what we will end up with than DALPAs incompetence or our CEOs genius.

In my opinion, the market or Pilot supply and demand is the paramount factor in negotiations and we currently have a very strong market.

Scoop

Can you give us a little more info?

Like years at Delta when you retire. What you are projecting for FAE etc.

I am 53 with 12 years to go and was never the best saver, and although it seems like most retirement podcasts say that the 4% rule is outdated, even if I use it, I am looking at close to what I am making as a narrow body captain if I stay till age 65..

That is not counting the 1000 or so dollars a month from PBGC.

Same here..mid 30s aggressively stuffing as much as I can in my 401k a year. Year 5 guy putting away around 40k a year. Luckily for us I think retirement will be ok. I would like to see additional gains to retirement and am interested to hear about the hybrid plan the union keeps mentioning.

Besides scope, I’d like to see QOL gains in most areas. Training/vacation pay, DH, medical plans that don’t cost an arm and a leg, retirement medical and the RCC having some contractual teeth are some of the areas we need to see improve.

I think there's gonna be a generational difference on some of this. Grand fathers generation had a pension, fathers generation didn't have parents telling them to bear down and save so they didn't until late in life when it turns out, "you mean I'm not gonna die at 67?", to this generation of pilots who had mom and dad yelling to save save save. I'd even bet this current crop who won't marry and saves retire early. Generations are wildly different. Wilfred Brimley was 49 when he shot cocoon. *shrug* Tom Brady is 42 playing in the NFL. The generation retiring didn't go through a decade of 40-50 grand a year, and maybe they had a furlough, but they're trying to get with the program in the last 5years and it's ugly to watch.

https://player.fm/series/adam-ruins-everything/ep-43-professor-teresa-ghilarducci-on-the-future-of-401ks

This!

If their generation had known their pensions/medical were going to be gutted, I'm sure they would have killed to have had 16% DC their entire careers. You can't deny that our generation has benefited immensely from the lessons learned from the previous generations loss of pensions. Who knows what the future of our 401Ks have in store...the next generations may look at us like we're idiots for relying on 401Ks. Partially why I have invested in rentals/other income producing opportunities.

Throw in a B-scale, a furlough and mid-2000s paycut...that's a tough go. Take a look at he bankruptcy payrates! 12 year 777As making $185/hr with no real PS! What's that today...a 6-7 year 7ERB or a 3-4 year 320B if you add in PS?

Great thread Scoop!

Why the desire to reveal someone’s identity on an anonymous message board?

$500,000 * 0.12 = $60,000 / 0.04 = $1,500,000
$400,000 * 0.12 = $48,000 / 0.04 = $1,200,000
$300,000 * 0.12 = $36,000 / 0.04 = $900,000
$200,000 * 0.12 = $24,000 / 0.04 = $600,000

After the PBGC, claim, and note and $100,000 per year added on top of your DC 401k plan, you are still going to draw less than $60,000 per year in retirement?

Financial advisors are a scam. Read The Simple Path to Wealth by JL Collins instead.

Agreed. Our generation will need to diversify. The 401k Gov’t money grab will come at some point in our careers.

I have no idea how your PBGC payment at 65(should be between 5500 and 7000 plus a month if your a true deadzoner, mine will be 7500) combined with the note money, MPP money, claim money and having your 415C bucket filled up for 3 years plus the DC plan since 2005 gets you to a 12% FAE. If your FAE is 400,000 a year a 12% FAE is 48,000 a year. Something horrendous must have happened with your investment strategy. I have done nothing really smart investment wise and will have a retirement at least 5 times where you are at and did not add 100k on top each year. I totally screwed up my MPP investment and lost a bunch there. Had I just put that in a S&P 500 fund I would have another 300K.

Spot on Scoop. I’d add that the education we need is the costs of our contract requests. I’ve written it before, but we can all stand around and argue about the importance of various contract improvements, but until we have some estimate of the costs of various items, we will see little unity. Unity is one measure of our capital in negotiations, and our current disparate desires won’t yield to unity until we can make informed trades among the various constituencies.

We need to be able to propose—to each other—an incremental cost to the company for our future contract and then discuss filling that cost with our desires in an equitable fashion. We need to be able to say, “I think DAL will pay $1.25B over three years to sign a deal” or better, “I think the company will accept pilot costs of $1.10 per average seat mile” and then discuss whether we allocate 25% of that to pay rates with a 5:45 vacation day or 50% of that to pay rates.

These data will be estimates, will lack important detail from non-cost items (like sick usage rules, for instance), and will lack proprietary inputs that could make them better. With all of these known deficiencies they would be better than nothing. I recommend we ask the union for these estimates. I have.

For those of us in the 30...should be looking at whole like insurance. With 4 to 5% + dividends steady for 30 yrs is a passive way to save money.

We won’t see Social Security, so...we need other venues to shelter money. I’ve been saving around 30k yr + what I can get in my 401k.

Whole life huh? Oh boy now you’ve really opened up a can of worms!

I know :D :p :rolleyes:

There are some CAs also doing them, I don’t see them complaining about retirement, anywhere.

Surviving at 65 v going out in style at 60. Even with no divorce, no airplane, no boat, no failed businesses, you get the point. We're short a couple million in our pot of gold.

This is an example of why not to take financial advice from pilots


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Just because a few have ideas that are quite strange doesn't mean throw the entire profession under the bus. There are lots of pilots out there like yourself that are very sharp with personal finances.

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Near where I live 6 nice lakefront lots were coming on the market. I hoped I might get one to build a small retirement home. One guy bought all six plus a couple of acres of inland land. He moved a quarter mile of road to run it around his new land and built a house that needs to be seen to believe.
He had just retired from selling whole life insurance!

Kind of like, the best way to make money in a casino is to own one.

Me? I'm going to invest in gold.

Oh, and Freedom Pellets -- 'cause the gubmint is coming!

Aside from the ‘can’t survive at 65 hot mess above’ I see the biggest limiting factor for self funded progress is the 54k yearly contribution limit. Spreading it around in property, under the mattress and freedom pellets, lots of pellets’ only goes so far. Another investment vehicle would be nice.

I'm going to find a simple place near the ocean with great craft beer and fresh seafood and never have to wear long pants again....
The simple life is pretty good..

Whatever happened to the gold man?

Which one? The OG got a medical retirement after pulling a Corporal Klinger Section 8 and his disciple hit a light pole in BNA and has never been heard from again.

Don’t forget about pumpkin futures. They always spike this time of year, but I keep mistiming my exit. I get greedy and hold them into November. You know, Thanksgiving, and such. I keep getting smoked.:D

Captain light pole was big on here pushing TA1 until I ban hammered him. :D He also made the legendary “rocket surgeon” Facebook post in the same time period that there are a lot of screen shots of.

How many Billion is Delta going to make this year?

Who says you have to give anything up?

How did you get to this current compensation package if you had to give something up to get improvements every contract cycle?

Oh man I’ve only been here a couple years so wasn’t around, but this sounds like a story. Anyone have details/links?

Never mind

I'd invest against you, every day, all day.

Gold!!!!!!!!!!!


And freedom pellets!

And def ammo.

That one. I flew with him and his significant other one time. One time only. So, his he still around. Didn’t he punch someone at a road show.

Our uniform pants make nice black cutoff shorts.

He also is the one who taxiied into the baggage cart entering the ramp in ATL.

“What are you willing to give for that?” That’s what I hear every time I bring up an improvement to the PWA.

I envy the position the negotiators on the other side. To know that the very group you are working against leads with “what are you going to give up for that” puts them in a very powerful position that we cannot overcome easily.

Save concessions for consolatory times. They will come eventually.