Waffles
04-23-2021, 12:58 PM
#11
Gets Weekends Off
Joined APC: Mar 2021
Posts: 174
Originally Posted by kronan
Whether the internet guru's like it or not, a PSPP style Plan IS a Pension Plan. You don't get PBGC coverage of your 401k, don't get PBGC coverage of your B plan, will get PBGC coverage if we transition to a PSPP style plan.
Opponents seem to come down to 2 things.
1. ALPA will "forget" to negotiate for a floor value\benefit language will be subject to interpretation (See Lie Flat's grievance)
2. Stock market will implode and the Trust will be unable to sustain a floor benefit and FedEx won't be required to add $$ to the Trust in order to fully pay benefits. (See Japan's stock market, Japan still hasn't returned to it's market highs)
1. Got nothing for you here, other than this is the one segment of our Contract that the Governments fully on our side. ERISA law is on the Employee's side. RLA is heavily stacked against us. There's no rational reason that a Grievance takes multi-years to fully process. No real reason we couldn't have a new contract within 6-12 months. No reason under than RLA's keep the freight moving.
2. Not quite sure why this only impacts a PSPP style plan. Even so, people tend to forget that a component of the plan is FedEx being required to put money into our Pension trust each and every year, not just when they feel like it. And as Fastburner can attest, FedEx has put some pretty big chunks of cash into the FedEx Pension Trust ($$ not just to us, but for every FedEx employee covered by their original pension or the Portable Pension which was imposed on them over a decade ago). And even in Japan, there's been some darn good returns as they work back towards their market highs.
Add in the simple reality that there would be very FEW people drawing on the assets initially should we transition to a PSPP style plan. Something that's counter-intuitive is that in a way, we'd benefit from 2 or 3 down years at the beginning of a PSPP style pension...just as Dollar Cost Averagers benefit in mutual funds. (For those of us who're financially literate, last springs market collapse was the best buying opportunity the majority of us will ever have. And has certainly resulted in some eye watering 1 year returns)
And now one other slam, the "some of us" will have to be bought up to the 1999 standard. The Some of US are the QOL folks who plan on spending the first 10-18 years of their FedEx career working 50% of their BLG (+/- some unknowable percentage)
Working a fraction of your BLG has a Huge Impact on the final outcome of your 401k\B plan final value. Warren Buffet is revered as an Investor due pretty much to the longevity of his investing career and the miracle of Compounding Interest (something WE don't benefit from in a PSPP style plan, but our Pension Trust will)
IMO- some people will continue to make that choice. They might have family money, military pension, but an individual choice.
There are so many posts on a PSPP style plan, really have to wonder at the mindset of people saying over and over that a Majority of Pilots oppose it. Put up a TA with it and it'll be shot down.
Well, for those of you who're also hardcore on never taking the first agreement. Seems to me the best possible thing that could happen is a PSPP style Pension transition being negotiated. Best of all worlds, "We" get to vote down a TA (Just as Delta did when their NC \ MEC negotiated a modification to their profit-sharing plan for increased guaranteed pay). Finally a No vote for a TA and one that will result in a New group of leaders for Our Union.
Unfortunately, a PSPP style transition isn't going to be negotiated in, because I've also learned here that a PSPP style Defined Benefit Plan is MORE expensive than improving our Traditional Plan.
And if there's one thing I've learned in my 20 years at FedEx, Management will ALWAYS choose the cheaper option when it comes to Pilot Benefits (See Hotel rooms\Express Scripts)
NIKKEI 225 Index (Japan) Yearly Stock Returns
Opponents seem to come down to 2 things.
1. ALPA will "forget" to negotiate for a floor value\benefit language will be subject to interpretation (See Lie Flat's grievance)
2. Stock market will implode and the Trust will be unable to sustain a floor benefit and FedEx won't be required to add $$ to the Trust in order to fully pay benefits. (See Japan's stock market, Japan still hasn't returned to it's market highs)
1. Got nothing for you here, other than this is the one segment of our Contract that the Governments fully on our side. ERISA law is on the Employee's side. RLA is heavily stacked against us. There's no rational reason that a Grievance takes multi-years to fully process. No real reason we couldn't have a new contract within 6-12 months. No reason under than RLA's keep the freight moving.
2. Not quite sure why this only impacts a PSPP style plan. Even so, people tend to forget that a component of the plan is FedEx being required to put money into our Pension trust each and every year, not just when they feel like it. And as Fastburner can attest, FedEx has put some pretty big chunks of cash into the FedEx Pension Trust ($$ not just to us, but for every FedEx employee covered by their original pension or the Portable Pension which was imposed on them over a decade ago). And even in Japan, there's been some darn good returns as they work back towards their market highs.
Add in the simple reality that there would be very FEW people drawing on the assets initially should we transition to a PSPP style plan. Something that's counter-intuitive is that in a way, we'd benefit from 2 or 3 down years at the beginning of a PSPP style pension...just as Dollar Cost Averagers benefit in mutual funds. (For those of us who're financially literate, last springs market collapse was the best buying opportunity the majority of us will ever have. And has certainly resulted in some eye watering 1 year returns)
And now one other slam, the "some of us" will have to be bought up to the 1999 standard. The Some of US are the QOL folks who plan on spending the first 10-18 years of their FedEx career working 50% of their BLG (+/- some unknowable percentage)
Working a fraction of your BLG has a Huge Impact on the final outcome of your 401k\B plan final value. Warren Buffet is revered as an Investor due pretty much to the longevity of his investing career and the miracle of Compounding Interest (something WE don't benefit from in a PSPP style plan, but our Pension Trust will)
IMO- some people will continue to make that choice. They might have family money, military pension, but an individual choice.
There are so many posts on a PSPP style plan, really have to wonder at the mindset of people saying over and over that a Majority of Pilots oppose it. Put up a TA with it and it'll be shot down.
Well, for those of you who're also hardcore on never taking the first agreement. Seems to me the best possible thing that could happen is a PSPP style Pension transition being negotiated. Best of all worlds, "We" get to vote down a TA (Just as Delta did when their NC \ MEC negotiated a modification to their profit-sharing plan for increased guaranteed pay). Finally a No vote for a TA and one that will result in a New group of leaders for Our Union.
Unfortunately, a PSPP style transition isn't going to be negotiated in, because I've also learned here that a PSPP style Defined Benefit Plan is MORE expensive than improving our Traditional Plan.
And if there's one thing I've learned in my 20 years at FedEx, Management will ALWAYS choose the cheaper option when it comes to Pilot Benefits (See Hotel rooms\Express Scripts)
NIKKEI 225 Index (Japan) Yearly Stock Returns
04-23-2021, 03:06 PM
#12
Gets Weekends Off
Joined APC: Jul 2006
Posts: 500
Originally Posted by kronan
Whether the internet guru's like it or not, a PSPP style Plan IS a Pension Plan. You don't get PBGC coverage of your 401k, don't get PBGC coverage of your B plan, will get PBGC coverage if we transition to a PSPP style plan.
Opponents seem to come down to 2 things.
1. ALPA will "forget" to negotiate for a floor value\benefit language will be subject to interpretation (See Lie Flat's grievance)
2. Stock market will implode and the Trust will be unable to sustain a floor benefit and FedEx won't be required to add $$ to the Trust in order to fully pay benefits.
Opponents seem to come down to 2 things.
1. ALPA will "forget" to negotiate for a floor value\benefit language will be subject to interpretation (See Lie Flat's grievance)
2. Stock market will implode and the Trust will be unable to sustain a floor benefit and FedEx won't be required to add $$ to the Trust in order to fully pay benefits.
Let's start with some big issues with the waffles plan. First, NO ONE ELSE IS CONVERTING THEIR DB PLAN TO A WAFFLES PLAN. NO ONE. The only companies that have ever done this are companies that are either about to terminate their DB plan or they don't currently have a DB plan. That should stop you dead in your tracks. That is the end of the discussion really. While only 15-20 percent of the SP500 companies still have DB plans, no one is changing to waffles. There are some big hitter financial companies with DB plans and they are not lining up to change. The alarm bells in your brain should be screaming at you right now. "WHOOP WHOOP PULL UP" Who in their right mind would trust a pilot to make a financial decision that goes against every other financial expert out there. Yet here you go. IF you cannot see the obvious mountain in front of the plane feel free to ask your Fidelity assistance expert. Or call Vanguard. Or ING or any financial advisor. ASK anyone other than our ALPA MEC.
So discounting this is the dumbest idea since our previous retirement "expert" KB spent his time extolling how great timeshare properties are as a financial instrument. This plan is a huge "screw your buddy" plan. One of the major hallmarks of being a professional pilot (and by default an ALPA member) is the ability of one generation of pilots to look out for and mentor the next generation. While at times groups have forgotten that and thrown their own or their new hires under the bus (B-Scale), here at FDX we have tried to never lose sight of who is coming behind us. Let's make it better for those that come after us. This plan is a Variable Benefit plan. Not a Variable return plan. Meaning each person's individual benefit will be different. In your vernacular, each person's waffle will be a different size every year. You will receive a waffle that is the same percentage size as your earnings are to the total earnings of all the pilots for the year. Right now I get the exact same size credit towards my DB as every other pilot with less than 25 YOS. If I work max carryover and sell back vacation; my DB plan "contribution" is exactly the same as the pilot that works min BLG and protects min days off. Our paychecks are different, but our retirement DB is the same. With the new plan, it's your percentage of the total. So if you work min days or drop for family or are out with disability or mil leave or whatever; your waffle at the end of the year will be smaller. Every year you prioritize a family/military/health/etc over maximizing your pay, you will get less in retirement than you projected.
Now right now you are thinking, BS, I saw the Chiron projections. Remember as has been posted, those are just unicorn wishes from Chiron. But more importantly, the biggest assumption that was made was everyone worked the same amount I think it was 1000 Ch. There is no way for them to program max earning for 20% of the pilots and then try and show you what you would earn. So first you have to ask yourself, am I a max earner? The top 3 MEC officers get paid max BLG plus carryover every month so they are max earners. There are many in the schoolhouse that can really make some serious max earners. The guys who fly max BLG plus carryover every month are somewhat max earning (although it's straight time). The LCAs and flexs are maxing out in many cases. Those on the draft speed dial are max earner. The management pilots are maxing out their pay. There are a whole lot of guys on the property that make a great living. Some work their butts off to make it happen. Good for them. I love that we have that ability here to let guys earn what they want. Because what they earn has no effect on me and my retirement package. But once it does now what. Try to think through the ramifications. All the guys with good "deals" now will be under the microscope from those without good deals. The first immediate step will be the elimination of all "incentive" pay. No more LCA pay, no more instructor pay, no more flex pay. Unless everyone has the opportunity for those pay increasers they are now adversely affecting your retirement if you don't have them. That sounds like a lawsuit against ALPA before the ink is dry if those extra pay opportunities are still in the contract. The draft speed dial....I guess ALPA will have to set up a draft office to ensure that draft calls are done IAW the contract. That will grind scheduling to a halt since they will have to call by seniority like they are supposed to rather than call the guys they know will come to fly NOW. Of course, the mad rush to the highest paying seat will crush the training department for years and shove the junior pilots back into lower paying seats. Another lawsuit will be ready-made unless the company allows a post-contract rebid for all seats so that pilots have the opportunity to hold the highest paying seat their seniority allows now that their retirement pay will be based on what they earn every year. I might be seeing black helicopters a bit now, so I'll stop there.
But yes I still have big problems with the hurdle rate, return forecasts, payout stability, seed money, etc. But I never even get that far down in the weeds before I hit my personal "STOP, do not pass Go" point.
But why you would ever be a proponent of getting your own rather than let's improve everyone is beyond me. When you have kids if any of them want to get into flying, wouldn't you want to tell them to go FDX. Make this place better than it was when you got here for those that are still to come. Don't be 85 sitting on your yacht hearing FDX pilots wish they had a DB plan like they used to. "Be the ball Danny", set your sights on "your God-given right for something better" and "stand a post" on the wall with the rest of us. (yes lots of 80s quotes right there)
04-23-2021, 03:19 PM
#13
Gets Weekends Off
Joined APC: Sep 2007
Position: 777 Captain in Training
Posts: 1,457
Originally Posted by kronan
Whether the internet guru's like it or not, a PSPP style Plan IS a Pension Plan. You don't get PBGC coverage of your 401k, don't get PBGC coverage of your B plan, will get PBGC coverage if we transition to a PSPP style plan.
Opponents seem to come down to 2 things.
1. ALPA will "forget" to negotiate for a floor value\benefit language will be subject to interpretation (See Lie Flat's grievance)
2. Stock market will implode and the Trust will be unable to sustain a floor benefit and FedEx won't be required to add $$ to the Trust in order to fully pay benefits. (See Japan's stock market, Japan still hasn't returned to it's market highs)
1. Got nothing for you here, other than this is the one segment of our Contract that the Governments fully on our side. ERISA law is on the Employee's side. RLA is heavily stacked against us. There's no rational reason that a Grievance takes multi-years to fully process. No real reason we couldn't have a new contract within 6-12 months. No reason under than RLA's keep the freight moving.
2. Not quite sure why this only impacts a PSPP style plan. Even so, people tend to forget that a component of the plan is FedEx being required to put money into our Pension trust each and every year, not just when they feel like it. And as Fastburner can attest, FedEx has put some pretty big chunks of cash into the FedEx Pension Trust ($$ not just to us, but for every FedEx employee covered by their original pension or the Portable Pension which was imposed on them over a decade ago). And even in Japan, there's been some darn good returns as they work back towards their market highs.
Add in the simple reality that there would be very FEW people drawing on the assets initially should we transition to a PSPP style plan. Something that's counter-intuitive is that in a way, we'd benefit from 2 or 3 down years at the beginning of a PSPP style pension...just as Dollar Cost Averagers benefit in mutual funds. (For those of us who're financially literate, last springs market collapse was the best buying opportunity the majority of us will ever have. And has certainly resulted in some eye watering 1 year returns)
And now one other slam, the "some of us" will have to be bought up to the 1999 standard. The Some of US are the QOL folks who plan on spending the first 10-18 years of their FedEx career working 50% of their BLG (+/- some unknowable percentage)
Working a fraction of your BLG has a Huge Impact on the final outcome of your 401k\B plan final value. Warren Buffet is revered as an Investor due pretty much to the longevity of his investing career and the miracle of Compounding Interest (something WE don't benefit from in a PSPP style plan, but our Pension Trust will)
IMO- some people will continue to make that choice. They might have family money, military pension, but an individual choice.
There are so many posts on a PSPP style plan, really have to wonder at the mindset of people saying over and over that a Majority of Pilots oppose it. Put up a TA with it and it'll be shot down.
Well, for those of you who're also hardcore on never taking the first agreement. Seems to me the best possible thing that could happen is a PSPP style Pension transition being negotiated. Best of all worlds, "We" get to vote down a TA (Just as Delta did when their NC \ MEC negotiated a modification to their profit-sharing plan for increased guaranteed pay). Finally a No vote for a TA and one that will result in a New group of leaders for Our Union.
Unfortunately, a PSPP style transition isn't going to be negotiated in, because I've also learned here that a PSPP style Defined Benefit Plan is MORE expensive than improving our Traditional Plan.
And if there's one thing I've learned in my 20 years at FedEx, Management will ALWAYS choose the cheaper option when it comes to Pilot Benefits (See Hotel rooms\Express Scripts)
NIKKEI 225 Index (Japan) Yearly Stock Returns
Opponents seem to come down to 2 things.
1. ALPA will "forget" to negotiate for a floor value\benefit language will be subject to interpretation (See Lie Flat's grievance)
2. Stock market will implode and the Trust will be unable to sustain a floor benefit and FedEx won't be required to add $$ to the Trust in order to fully pay benefits. (See Japan's stock market, Japan still hasn't returned to it's market highs)
1. Got nothing for you here, other than this is the one segment of our Contract that the Governments fully on our side. ERISA law is on the Employee's side. RLA is heavily stacked against us. There's no rational reason that a Grievance takes multi-years to fully process. No real reason we couldn't have a new contract within 6-12 months. No reason under than RLA's keep the freight moving.
2. Not quite sure why this only impacts a PSPP style plan. Even so, people tend to forget that a component of the plan is FedEx being required to put money into our Pension trust each and every year, not just when they feel like it. And as Fastburner can attest, FedEx has put some pretty big chunks of cash into the FedEx Pension Trust ($$ not just to us, but for every FedEx employee covered by their original pension or the Portable Pension which was imposed on them over a decade ago). And even in Japan, there's been some darn good returns as they work back towards their market highs.
Add in the simple reality that there would be very FEW people drawing on the assets initially should we transition to a PSPP style plan. Something that's counter-intuitive is that in a way, we'd benefit from 2 or 3 down years at the beginning of a PSPP style pension...just as Dollar Cost Averagers benefit in mutual funds. (For those of us who're financially literate, last springs market collapse was the best buying opportunity the majority of us will ever have. And has certainly resulted in some eye watering 1 year returns)
And now one other slam, the "some of us" will have to be bought up to the 1999 standard. The Some of US are the QOL folks who plan on spending the first 10-18 years of their FedEx career working 50% of their BLG (+/- some unknowable percentage)
Working a fraction of your BLG has a Huge Impact on the final outcome of your 401k\B plan final value. Warren Buffet is revered as an Investor due pretty much to the longevity of his investing career and the miracle of Compounding Interest (something WE don't benefit from in a PSPP style plan, but our Pension Trust will)
IMO- some people will continue to make that choice. They might have family money, military pension, but an individual choice.
There are so many posts on a PSPP style plan, really have to wonder at the mindset of people saying over and over that a Majority of Pilots oppose it. Put up a TA with it and it'll be shot down.
Well, for those of you who're also hardcore on never taking the first agreement. Seems to me the best possible thing that could happen is a PSPP style Pension transition being negotiated. Best of all worlds, "We" get to vote down a TA (Just as Delta did when their NC \ MEC negotiated a modification to their profit-sharing plan for increased guaranteed pay). Finally a No vote for a TA and one that will result in a New group of leaders for Our Union.
Unfortunately, a PSPP style transition isn't going to be negotiated in, because I've also learned here that a PSPP style Defined Benefit Plan is MORE expensive than improving our Traditional Plan.
And if there's one thing I've learned in my 20 years at FedEx, Management will ALWAYS choose the cheaper option when it comes to Pilot Benefits (See Hotel rooms\Express Scripts)
NIKKEI 225 Index (Japan) Yearly Stock Returns
04-23-2021, 05:21 PM
#15
Line Holder
Joined APC: May 2013
Position: MD
Posts: 62
Over four years ago, before the permanent loss of medical, I accurately predicted that the train had left the station. And I stated that all there was is a brakeman called "50%+1". Rest assured all you pancake eaters, if you find yourself in my position, a DB based on high five is manna from heaven for retirement planning. It is the only thing I have that is predictable. And no, my high five average doesn't exceed $260k, not even close. But, a predictable amount enables me to plan and invest the B fund.
Having watched 25 years of union people rotating into management, training people rotating through various departments endlessly, I see two major reasons for the push. First, those who are raking in big dollars (union leadership, some training dept and special projects people, and people who don't get the FDX management retirement program) have a vehicle to get something approaching the management retirement. Second, this is a huge pot of money, with huge $$$ for "management" of those assets. Something that ALPA national would just love to get their hands on. Just like some other big unions who "manage" the retirement for their members.
I coined the phrase I prefer waffles. But I don't waffle on pancakes, they suck now, they will suck, and everyone except the few above unmentionables above will say, Boy this sucks.
Having watched 25 years of union people rotating into management, training people rotating through various departments endlessly, I see two major reasons for the push. First, those who are raking in big dollars (union leadership, some training dept and special projects people, and people who don't get the FDX management retirement program) have a vehicle to get something approaching the management retirement. Second, this is a huge pot of money, with huge $$$ for "management" of those assets. Something that ALPA national would just love to get their hands on. Just like some other big unions who "manage" the retirement for their members.
I coined the phrase I prefer waffles. But I don't waffle on pancakes, they suck now, they will suck, and everyone except the few above unmentionables above will say, Boy this sucks.
04-23-2021, 06:20 PM
#16
Gets Weekends Off
Joined APC: Jun 2015
Position: Fetal in the hub
Posts: 406
Ok show me a PPSP success story. Enough with the nebulous hypotheticals and the salesmanship. I'm not backing anything based on someone's or group of someone's "belief" in the fidelity of a plan that is far too contingent upon variables that have yet to be "negotiated".
When the starting negotiating position is capitulation/acquiesce it doesn't inspire much confidence.
When the starting negotiating position is capitulation/acquiesce it doesn't inspire much confidence.
04-24-2021, 07:08 AM
#17
Gets Weekends Off
Joined APC: Aug 2012
Posts: 670
Originally Posted by Jamo
According to the calculator, I would come out much better with the pancake plan. According to my integrity, I will vote no for it anyways. Those hired with me, but at an older age, would lose out. (I don’t trust our union to bargain to “make them whole” when they can’t even bargain lay flat seats. We need to vote on what helps us all; not just what’s good for you personally. This appears to be the past issue with lack of testicular fortitude. Luckily we have a lot of new hires that have gone through this at the regional (red headed step child) level. For example, I’m a line holder but if reserve isn’t improved, I’m a ‘no’ vote. Integrity matters. Out of curious Itú, do you have your high 5 and how old are you? I’m 39.
04-24-2021, 07:18 AM
#18
Gets Weekends Off
Joined APC: May 2006
Posts: 1,804
Originally Posted by opt0712
This. I too would come out ahead with the PSPP, but will not throw my older brethren under the bus for ALPA's agenda.
04-24-2021, 09:49 AM
#19
Gets Weekends Off
Joined APC: Apr 2013
Posts: 1,622
Originally Posted by Jamo
According to the calculator, I would come out much better with the pancake plan... We need to vote on what helps us all; not just what’s good for you personally.
Originally Posted by opt0712
This. I too would come out ahead with the PSPP, but will not throw my older brethren under the bus for ALPA's agenda.
Those projections by Chiron are just that, best case projections based on many assumptions that have not been negotiated. To quote our Chairman ... "fantastical." The PSPP puts all of your eggs into the stock market. And right now the stock market is getting crazy ridiculous because of uneducated amateur investors. Look at the GameStop fiasco. Is Tesla really worth more than the top seven car manufacturers combined? (Toyota, VW, Daimler, GM, Ferrari, BMW, Honda) The stock market has become extremely overpriced due to amateur emotional investors and not profit/stability valuation based.
The best part about A-plan / B-plan setup is that it is diversified. And the A-fund is 100% funded!!! Where else in corporate or government America do you find that? ALMOST NO WHERE
As others have said, our own VanGuard advisors (when we used them), company paid for advisors from Fidelity, and ALPA's paid for advisors from Charles Schwabb all have told me that we are making a huge mistake by switching to the PSPP.
We will be the biggest laughing stock of airline pilots if we give up our 100% funded A-plan for this.
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