Road to the TA 20-02
01-25-2020 | 05:33 PM
#71
Gets Weekends Off
Joined: Mar 2015
Posts: 13,211
Likes: 655
From: ir.delta.com
Obviously I can't make that judgement now but it's high on my dislikes. Would you single issue no vote if retirement DC is increased but no other provisions for tax savings or plus up were part of the deal? Not really a fair question, is it?
Last edited by notEnuf; 01-25-2020 at 05:58 PM.
01-25-2020 | 05:59 PM
#72
seeing the country...
Joined: Oct 2006
Posts: 4,001
Likes: 32
From: 73N A
I don't know, but I wish I could get a good Notepad about the tax benefits from the union. I suspect that we won't - all we'll see is "Consult a tax professional for more information".
01-25-2020 | 06:19 PM
#73
Gets Weekends Off
Joined: Sep 2008
Posts: 6,971
Likes: 0
From: Kickin’ Back
If you, or anyone for that matter, ever layover in Seattle please PM if you want to meet for a beer or whatever. If I'm home I'm I would be more than happy to do so!
Denny
01-25-2020 | 06:33 PM
#74
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Joined: Oct 2014
Posts: 1,015
Likes: 13
You do realize that it’s a “targeted” 5% return, not guaranteed, right? If the market tanks then your MBCBP tanks too. There’s nothing fancy about the investments in the MBCBP. It’s a container for tax deferred money that is nominally yours and someone else controls.
01-25-2020 | 06:35 PM
#75
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Joined: Sep 2014
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01-25-2020 | 06:37 PM
#76
Gets Weekends Off
Joined: Mar 2015
Posts: 13,211
Likes: 655
From: ir.delta.com
That's all that can be asked, to keep an open mind. As you, I want to see the whole enchilada before I vote on anything. In that sense it's a fair question to see where one stands.
If you, or anyone for that matter, ever layover in Seattle please PM if you want to meet for a beer or whatever. If I'm home I'm I would be more than happy to do so!
Denny
If you, or anyone for that matter, ever layover in Seattle please PM if you want to meet for a beer or whatever. If I'm home I'm I would be more than happy to do so!
Denny
01-25-2020 | 06:37 PM
#77
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Joined: Oct 2014
Posts: 1,015
Likes: 13
Based on what we know, if you are more than 10 years away from retirement, unless you expect your marginal tax rate to be significantly lower (like 12% vs 22%). You are better off taking your money and putting in in a brokerage account. The union hasn’t proposed anything that has benefits that outweigh the expenses.
01-25-2020 | 06:41 PM
#78
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Joined: Jun 2019
Posts: 643
Likes: 13
From: Currently freeloading
That's not correct. If the plan is set up with a 5% return, it pays 5%. If the actual market return is higher, the excess earning go into a reserve fund. The next time the market return is less than 5%, the reserve fund is used to fill out the 5%. If there's a string of bad luck and the reserve fund runs out, the company is required to use operating cash to fill it out. Since this process happens every year, the program is always fully funded.
01-25-2020 | 06:49 PM
#79
Gets Weekends Off
Joined: Mar 2015
Posts: 13,211
Likes: 655
From: ir.delta.com
That's not correct. If the plan is set up with a 5% return, it pays 5%. If the actual market return is higher, the excess earning go into a reserve fund. The next time the market return is less than 5%, the reserve fund is used to fill out the 5%. If there's a string of bad luck and the reserve fund runs out, the company is required to use operating cash to fill it out. Since this process happens every year, the program is always fully funded.
01-25-2020 | 07:54 PM
#80
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Joined: Oct 2014
Posts: 1,015
Likes: 13
That's not correct. If the plan is set up with a 5% return, it pays 5%. If the actual market return is higher, the excess earning go into a reserve fund. The next time the market return is less than 5%, the reserve fund is used to fill out the 5%. If there's a string of bad luck and the reserve fund runs out, the company is required to use operating cash to fill it out. Since this process happens every year, the program is always fully funded.
I should have been more specific. We are saying the same thing.
He is holding the MBCBP out as this vehicle which gets a guaranteed 5%. It’s not that at all. They target 5% as a growth rate. And in order to get that they will either withhold growth above 5% to use in the future, or take credit for that previous growth in terms of average rate.
If the market tanks, having your money in the MBCBP gains you nothing.
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