FedEx retirement clarification
 

Could someone please clarify the A and B plan for Fedex’s Retirement info on APC. I haven’t found anything on the forum and don’t know anybody in company to ask.

Thanks

B plan is 8% up to IRS limits
Increases to 9% Jan 1, 2020

A plan is 2% YOS (up to 25) times High 5 of Income (260k cap)

To interpret what he said.

A Plan

2% multiplied by Year of Service up to 25 years would equal 50%
of a maximum $260k. So that equals $130k per year pension best case at current book.

B Plan

8% DC (Defined Contribution) aka no need to match.

But there is also a $500/yr match as well.

Thanks guys, that makes much more sense.

B fund is your money...In your name

A fund is the companies promise to pay. IE a pension

Are the IRS limits for defined contribution the same as an employee elective contribution? ($18.5k)

"The contribution limit for employees who participate in 401(k), 403(b), most 457 plans, and the federal government’s Thrift Savings Plan is increased from $18,000 to $18,500."

"The limitation for defined contribution plans under Section 415(c)(1)(A) is increased in 2018 from $54,000 to $55,000."

https://www.irs.gov/newsroom/irs-ann...18500-for-2018

So...if your sick bank is full (686 credit hours) any unused sick hours in a given year will roll into your 401k up to the $55,000 IRS limit, after which the Company cuts you a check for the remainder.
You can also contribute an additional $6,000 “catch-up contribution” if you are 50 years old or older.

Miso, very slight correction for you, the "catch-up contribution" is allowed once you have entered your "49th year".
fbh

Agreed. Thanks for the correction...

Applying age 50 rule (from irs.gov):

“A participant who is eligible to make catch-up contributions is referred to in Treas. Reg. 1.414(v)-1(g)(3) as a “catch-up eligible participant.” A participant is catch-up eligible with respect to a plan year if the participant turns age 50 by the end of the calendar year in which the plan year ends, and the participant is eligible to make elective deferrals under the plan (without regard to IRC Section 414(v)). (Note that the Code and Regulations specifically refer to a participant’s taxable year, not the calendar year. However, since the taxable year for most individuals is the calendar year, this Snapshot will refer to the participant’s taxable year as the calendar year. )

A participant is deemed to be age 50 any time during the calendar year in which he turns 50. Thus, in a non-calendar year plan, a participant is permitted to make catch-up contributions even if he will not turn age 50 until the next plan year, if the participant will turn 50 by the end of the calendar year during which the participant makes catch-up contributions.

Example. John will turn age 50 on November 30, 2018. He participates in a 401(k) plan that permits catch-up contributions. The plan has an October 1 to September 30 plan year. John is deemed to be age 50 on January 1, 2018. He is eligible to make a catch-up contribution to the plan for the plan year ending September 30, 2018, even though he will not turn 50 until the following plan year.”

If only our Union negotiators were as meticulous when it came to the Contract “lie-flat” seat language.