Originally Posted by Albief15

I've stayed out of most of the angst-fest on the retirement discussion, hoping to wait and see some ideas in print before making a yes/no decision.

The "pilots will kill themselves to max out every paycheck" idea was mentioned by our HKG block rep in a discussion. He said one idea is a cap on total number of hours that are pensionable. Where will that line be? Probably north of BLG, but south of what the group determines as "reasonable".

Second--this program if it goes will benefit the younger pilot group tremendously. They will remove the inflation reducing 260k limit and be able to ride the cost of living slope upwards instead of losing 2-3% a year like we are doing now. They will also see their 25+ year career (for any hired under 40....) get some additional benefit. The youngest pilots here seem to have the most to gain albeit with some market risk.

In my 50s, I'm a "tweener". I won't make a fortune off even a very lucrative new plan, nor will I lose out tremendously if it is a dud because of my already acquired A plan benefit. My career here was going to be 22 years, but now could go to 27 with the 65 retirement. Two extra years of improved benefits probably won't be enough to make me want to extend my retirement 1 day past my "1 flight of bad catering" exit point. But there are others at both ends of the spectrum that could potentially gain a lot of benefit from a different plan.

Here's what I haven't heard anyone discuss. If the world economy fell into an abyss, and thus the variable benefit plan was pressured--what do you think would happen to our current A plan if we did nothing? Would 3-5 down years simply be ignored by the bean counters, or would they then seek to reduce or terminate the plan due to financial duress? Everyone points to the fact the new plan has some risk. The reality is our current plan does as well. With our stock almost tripling since 2008, its all rainbows and unicorns right now. But if the Great Recession hadn't ebbed, and it FedEx had furloughed, what do you think would have happened if the company had told a judge "we can save some jobs if we can just freeze/reduce/eliminate this pesky A plan burden?..."

Personally, I don't want to risk my A plan benefit UNLESS the reward is high enough to offset that risk. I have a number in mind--each of us probably does. I'll wait to see if any plan developed meets those expectations. If it doesn't...thanks...no...I'll pass. If it does, and I am looking at a serious boost in benefits for my retirement years, I'll certainly consider taking on the extra risk. But ignoring the fact our plan's real benefit is shrinking is foolhardy. The 2006 Pension reform act was build to discourage future defined benefit plans, not to protect pensioners. I'm glad the MEC is looking at options. The company is STILL on the hook to fund the benefit under the new plan, but the amount they have to contribute is fixed and not variable. The plan will still be managed (as it is now) by a group of third party professionals. The difference is we have the the chance to capture some of the upside in the market instead of being capped at a static number. The deciding factor IMHO will come down to three factors. First--the amount of upside per pilot we can expect if we accept a change. Second--the amount of stabilization fund (and sourcing for same) that will ensure we never go below what we can already expect with our (inflation shrunk) A plan. And finally--will the company even consider such an option. Right now, everyone is concerned about how much the company will make by allowing the variable plan into place. What I think some of you miss is every year that goes by, the 260k value is reduced 3-4%, so the company's "real" liability is dropping in cost to them every year. If they just sit tight--we continue to take a haircut every year. They may just decide to let our pension sit and wither.

If the company won't allow improvements to the A plan, then to me a "cash over the cap" B plan improvement will be the only way to protect the future. Once you start talking about "cash over the cap", then the academic argument becomes "why not just give me higher pay and let ME invest it NOW as I see fit..." Many of us hit the 415 (c) limits now, and there is always pressure in DC to lower same. A bigger B plan is really just flat pay raise to many of our pilots, and the tax bite will be a major concern.

Originally Posted by DLax85

Albie - I’ve always enjoyed your measured and balanced approach to virtually every issue; however, it appears to me you are making many assumptions on plan attributes without knowing the specifics either.

What is the pension formula under this new plan?

What is the yearly multiplier?

We’ve gotten a hint today that YOS may be uncapped. Do you think raising the max percentage from 50% to 60% to possible 80% is truly in the works?

And how will “average earnings” be calculated?

On a “high 5” basis...or perhaps over “entire career earnings”...??

(....it’s going to take a few good years to plus up that average after first year pay)

Do we believe there will be no cap at all?

Originally Posted by Albief15

Here's what I haven't heard anyone discuss. If the world economy fell into an abyss, and thus the variable benefit plan was pressured--what do you think would happen to our current A plan if we did nothing? Would 3-5 down years simply be ignored by the bean counters, or would they then seek to reduce or terminate the plan due to financial duress? Everyone points to the fact the new plan has some risk. The reality is our current plan does as well. With our stock almost tripling since 2008, its all rainbows and unicorns right now. But if the Great Recession hadn't ebbed, and it FedEx had furloughed, what do you think would have happened if the company had told a judge "we can save some jobs if we can just freeze/reduce/eliminate this pesky A plan burden?..."

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Originally Posted by Albief15

Here's what I haven't heard anyone discuss. If the world economy fell into an abyss, and thus the variable benefit plan was pressured--what do you think would happen to our current A plan if we did nothing? Would 3-5 down years simply be ignored by the bean counters, or would they then seek to reduce or terminate the plan due to financial duress? Everyone points to the fact the new plan has some risk. The reality is our current plan does as well. With our stock almost tripling since 2008, its all rainbows and unicorns right now. But if the Great Recession hadn't ebbed, and it FedEx had furloughed, what do you think would have happened if the company had told a judge "we can save some jobs if we can just freeze/reduce/eliminate this pesky A plan burden?..."

Originally Posted by pinseeker

And what would prevent them from doing the same thing with the VB plan? They say that the VB plan falls under the same protections of the PBGC as the DB plan. So what makes this plan better in your doomsday scenario than our current plan?

Originally Posted by kronan

White paper that started this internet hypothetical also indicated yearly benefit might be lower in a down year...but up in a great year.

Wasn’t all that long ago when my B plan was down...really glad I Didn’t PASS

B plans looking pretty good this year, hope that’s not Just Me though

Originally Posted by kronan

White paper that started this internet hypothetical also indicated yearly benefit might be lower in a down year...but up in a great year.

Wasn’t all that long ago when my B plan was down...really glad I Didn’t PASS

B plans looking pretty good this year, hope that’s not Just Me though

Originally Posted by kronan

White paper that started this internet hypothetical also indicated yearly benefit might be lower in a down year...but up in a great year.

Wasn’t all that long ago when my B plan was down...really glad I Didn’t PASS

B plans looking pretty good this year, hope that’s not Just Me though