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New Video-Every $ Earned & Yr Worked Matters?

Old 12-22-2017, 05:42 AM
  #31  
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Umm, no.

Here are some quick and dirty numbers. Assumptions on a 30 year career, 3 as NB FO, 3 as WB FO, 9 as NB CAPT, rest as WB. Assumes NO raises after amendable date of our contract. Assumes 6% return.

After 30 years, our notional newhire @ 16% should accumulate roughly 3.2M which equates to a 128k payout (remember, any raises in 5 years will only Increase that number)

@20% should accumulate 3.97M = 159k

I do like the 30%, that winds up at 5.96M = 234k


And, no, none of those numbers take into consideration our 8/9% B plan. While not estimating any future code increases (B plan limit goes to 275 next year)
Our newhire should accumulate 1.8M = 72.2k in the B plan

Just my limb here...but I’m thinking there might, just might be some desire once the numbers start coming out. Especially if it includes a lump sum option (my wag on lump sum option would be about 70% of the 3-5M accumulation...remember, it’s a hypothetical accumulation that generates an annual pension but it never actually draws down to 0 the way our B plan can)

Considering FedExs experience with the straight cash balance plans for our support folks, surprised they’re still sitting on our modified cash balance concept. And that’s all it is at the moment, words from my rep some time ago indicated that the 1st concept ppt show we received is what they presented to the company.

Specific details will be waiting on polling from us if mgt decides they’d like to enter negotiations.
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Old 12-22-2017, 06:39 AM
  #32  
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While I appreciate the group that is all for a big B fund vs an A fund. Please keep in mind that the B fund contribution limits are just that limits. Think back just a month when Congress was looking at lowering the 401K limit from 17000 per year. Equally low hanging fruit for politicians trying to increase the impact on high wage earners (us) would be to chop the max cap down from 54K. If that was dropped down to say 25K and all our eggs were now in a basket that relied on Congressional legislation we could very sad.

Just a quick reminder that all B fund, 401K limits, etc are legislative limits. An A fund is not. Not that I don't think we should look to improve the B fund, but I don't think we should put all our eggs in that basket. Yes, I'm hungry while typing.
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Old 12-22-2017, 08:43 AM
  #33  
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Originally Posted by kronan View Post
Umm, no.

Here are some quick and dirty numbers. Assumptions on a 30 year career, 3 as NB FO, 3 as WB FO, 9 as NB CAPT, rest as WB. Assumes NO raises after amendable date of our contract. Assumes 6% return.

After 30 years, our notional newhire @ 16% should accumulate roughly 3.2M which equates to a 128k payout (remember, any raises in 5 years will only Increase that number)

@20% should accumulate 3.97M = 159k

I do like the 30%, that winds up at 5.96M = 234k


And, no, none of those numbers take into consideration our 8/9% B plan. While not estimating any future code increases (B plan limit goes to 275 next year)
Our newhire should accumulate 1.8M = 72.2k in the B plan

Just my limb here...but I’m thinking there might, just might be some desire once the numbers start coming out. Especially if it includes a lump sum option (my wag on lump sum option would be about 70% of the 3-5M accumulation...remember, it’s a hypothetical accumulation that generates an annual pension but it never actually draws down to 0 the way our B plan can)

Considering FedExs experience with the straight cash balance plans for our support folks, surprised they’re still sitting on our modified cash balance concept. And that’s all it is at the moment, words from my rep some time ago indicated that the 1st concept ppt show we received is what they presented to the company.

Specific details will be waiting on polling from us if mgt decides they’d like to enter negotiations.
30 year career

1-3 NB FO
4-6 WB FO
7-15 NB Capt
16-30 WB Capt

Seems like a lot of upgrades at 100% and a lot of time on Reserve

We will be trading QOL now for retirement later

What “discount rate” are you applying to that QOL?

Our Current A plan only depends on your “High 5” — whenever you choose to get it.

And You only need to get it once!

I know Captains who’ve completed their High 5, who’ve bid back to NB Capt to hold their hometown

What happens to guys who go on disability for a few years, or those who never return?

In a “cash balance” or pure DC plan your YOS are powerless

Sure, the Time Value of Money and compounding are still exponentially powerful - but to make an equivalent benefit pilots will have to work much harder in their early years.

Trading our A fund to a plan that reduces a pilots flexibilty, lowers QOL options, and disadvantages those who may have a medical disability?

No thanks
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Old 12-22-2017, 08:51 AM
  #34  
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Originally Posted by kwri10s View Post
While I appreciate the group that is all for a big B fund vs an A fund. Please keep in mind that the B fund contribution limits are just that limits. Think back just a month when Congress was looking at lowering the 401K limit from 17000 per year. Equally low hanging fruit for politicians trying to increase the impact on high wage earners (us) would be to chop the max cap down from 54K. If that was dropped down to say 25K and all our eggs were now in a basket that relied on Congressional legislation we could very sad.

Just a quick reminder that all B fund, 401K limits, etc are legislative limits. An A fund is not. Not that I don't think we should look to improve the B fund, but I don't think we should put all our eggs in that basket. Yes, I'm hungry while typing.
Diversify me baby!!

Index A fund cap vs reasonable metric, and add additional YOS multipliers until 30th YOS.

Plus increase B fund towards 12-13% with cash over cap provision
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Old 12-22-2017, 11:41 AM
  #35  
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Originally Posted by kronan View Post
“We” do not exist in a Direct Democracy, but instead elect Representatives.

Our Representatives have said they’ve considered various options over the past 2 years and have settled on this one as the most beneficial.

If YOU, want to participate in evaluating every option and have 100% of the information...there’s an easy solution.
Confident it can be a bit time consuming, and occasionally frustrating.

What say you Albie15 and TonyC
Originally Posted by kronan View Post
Umm, no.

Here are some quick and dirty numbers. Assumptions on a 30 year career, 3 as NB FO, 3 as WB FO, 9 as NB CAPT, rest as WB. Assumes NO raises after amendable date of our contract. Assumes 6% return.

After 30 years, our notional newhire @ 16% should accumulate roughly 3.2M which equates to a 128k payout (remember, any raises in 5 years will only Increase that number)

@20% should accumulate 3.97M = 159k

I do like the 30%, that winds up at 5.96M = 234k


And, no, none of those numbers take into consideration our 8/9% B plan. While not estimating any future code increases (B plan limit goes to 275 next year)
Our newhire should accumulate 1.8M = 72.2k in the B plan

Just my limb here...but I’m thinking there might, just might be some desire once the numbers start coming out. Especially if it includes a lump sum option (my wag on lump sum option would be about 70% of the 3-5M accumulation...remember, it’s a hypothetical accumulation that generates an annual pension but it never actually draws down to 0 the way our B plan can)

Considering FedExs experience with the straight cash balance plans for our support folks, surprised they’re still sitting on our modified cash balance concept. And that’s all it is at the moment, words from my rep some time ago indicated that the 1st concept ppt show we received is what they presented to the company.

Specific details will be waiting on polling from us if mgt decides they’d like to enter negotiations.
Where to start?

First, our current A plan earns its full benefit at 25 YOS. So if you want to compare apples to apples, you need to run your numbers for 25 years.

Second, how much do you think the company contribute per pilot to the A plan annually? It is proprietary information, so we will never know an exact number, but a good estimate would be between $25K and $30K per year. At the current pay scale, a second year NB FO would get a $22.5K contribution at your 16% of pay rate. Over a 25 year period with our pay going up every year, a 16% of annual pay contribution would cost the company 2-3 times what it contributes right now. If they can afford that, why can't they afford to simply increase our current A plan benefit?

Third, your plan totally disregards QOL in your upgrade plan. What kind of line can a 7 year NB captain hold? How about a 15 year NB captain? What about a 16 year WB captain? A 15 year NB captain is still in the bottom 50% of the bid pack and a 16 year WB captain is in the bottom 80% of the bid pack. That sounds like a great way to live.

Finally, where do you come up with a 6% ROI? Most experts recommend a conservative mix on cash balance plans. A common recommendation is to put 50% of the investment in the US 10 year bond. The remaining 50% is diversified between other securities and equities. The current 10 year bond yields just under 2.5%. So, the other 50% would have to yield 9.5% on average to get your 6% ROI. Considering that the DOW has averaged about 7% ROI over the last 30 years, the recommended investment falls short of your 6%.

Considering your other statement above, I don't know why you are even discussing a 16%-20% cash balance plan. Our elected representatives have already made their decision.
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Old 12-22-2017, 11:51 AM
  #36  
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Originally Posted by DLax85 View Post
Diversify me baby!!

Index A fund cap vs reasonable metric, and add additional YOS multipliers until 30th YOS.

Plus increase B fund towards 12-13% with cash over cap provision
I agree with most of what you said.

I disagree with the 30 YOS. Why encourage pilots to work past 60? If you want to raise the YOS, why cap it at all?


If we are going to raise the cap on YOS, I would prefer at least 35. I was hired with pilots that could even make 40 YOS.

By putting a 30 cap on the YOS, you are still rewarding some pilots who could have retired at 60 with 25 YOS and not allowing others to reap the same benefit of working past 60.

Why not just provide better health insurance for those who retire at 60 to cover the gap?
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Old 12-22-2017, 12:05 PM
  #37  
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I want what we currently have at 60 with 25yos, I do not want to have to work longer to get the same benefit. I have zero desire to work until 65, even if it means Id get more than what I currently can get with our current make up.

Keep the A-plan and give me more b-fund with cash over cap. Also, as far as demographic go Im under 40.
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Old 12-22-2017, 02:38 PM
  #38  
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Originally Posted by pinseeker View Post
I agree with most of what you said.

I disagree with the 30 YOS. Why encourage pilots to work past 60? If you want to raise the YOS, why cap it at all?


If we are going to raise the cap on YOS, I would prefer at least 35. I was hired with pilots that could even make 40 YOS.

By putting a 30 cap on the YOS, you are still rewarding some pilots who could have retired at 60 with 25 YOS and not allowing others to reap the same benefit of working past 60.

Why not just provide better health insurance for those who retire at 60 to cover the gap?
I agree with your health insurance comment... if we negotiate a hsa type account that is funded by fdx each year till medicaid age (in addn to current high deductible deal) and cash over cap on b fund, i would be happy. with the new tax tables...A plan + RMD's at 70.5 will be at a much better rate now!! if you could count on the feds not to change anything 🤣
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Old 12-22-2017, 03:01 PM
  #39  
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This discussion is circular and will never provide the definitive answer to what is the best retirement for (collectively) Fedex pilots. Why? Because all off us come in with different timelines (years of service) and previous retirement savings, and possibly a pension from an earlier career. The sweet spot of our A plan is a 40 year old arriving as a second career, drawing a pension and working for 25 years at Fedex and able to earn 260K for 5 years while here. In terms of retirement $$$ for years worked at Fedex or income earned, this is the gold standard, all who come in later or spent the majority of there earning years at Fedex and did not pull a pension at age 40, pale by comparison.
The current freezing of the A plan benefit is changing that equation. Greater reliance on the variable pilot controlled portion, which is the default reality, means you will have a greater bank of wealth at retirement based on your desire (or luck) in how much you earn and how smart (or again lucky) each and every year you give Fedex. As far as fairness is concerned, this a better outcome than having the few who "win" by virtue of having come to Fedex after retiring from another job at age 40.
I would like to see the A plan caps raised/removed, but wishing for that looks increasing like chasing a rainbow, we will never get there. A fairer plan would use your career earnings to determine a lifetime payout, rewarding those who came, young and didn't earn a previous payout for service, and gave a majority of their time to Fedex. I don't see this happening either, but we need to do something. Nine precent B plan money over and above the diminishing value of our fixed (A plan) is not sustainable, not compared to the rest of the industry, over the long haul. Cash over cap is a good start for the B plan and for sure should be negotiated, I just doubt the company will do so outside of section 6. As for the fixed income part of our retirement, we should be fighting to ensure every Fedex pilot, at retirement, gets no less and possibly more, than 50% of his final (average ?) earnings, or better, 3% +- of his career earning each year until death.
It increasing looks as if future retirees are going to have to take on a greater part of the (investment) risk Fedex has, till now, assumed at 100%. This is the hand we have been dealt, the majority helped determined it when we voted in our last contact. Now's the time to either fix it or live with the declining value of our A plan. Wishing for a different outcome is wasted energy and pointless. Give your elected reps your opinion, but don't scream to them about an outcome we all had a hand in creating. Its time to move constuctively forward.
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Old 12-22-2017, 06:34 PM
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Originally Posted by dckozak View Post
This discussion is circular and will never provide the definitive answer to what is the best retirement for (collectively) Fedex pilots. Why? Because all off us come in with different timelines (years of service) and previous retirement savings, and possibly a pension from an earlier career...
Great argument for why one size does not fit all.
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