Pay attention to the fees for this new account.

22-B-2-c-(3) During each of the first five (5) full plan years after implementation of the
MBCBP, the trust investment gain/loss allocation to participants in the plan shall be
reduced by seven-tenths percent (0.7%) of the trust’s assets to provide an appropriate
reserve for account shortfall liability and any plan expenses permitted under ERISA. After
the completion of five (5) full plan years after implementation of the plan, such reduction
shall be one-half percent (0.5%) per year. Notwithstanding the foregoing, after the
completion of the first full plan year, should such cumulative reduction amount (as
adjusted to reflect investment earnings and losses on such amount, plan expenses,
including accrued plan expenses, and any participant shortfall payments) exceed one
percent (1%) of the MBCBP’s total assets (determined as of the end of each plan year
thereafter), such annual reduction shall be one-quarter percent (0.25%) for the twelve (12)
months following such determination.

0.7% for what amounts to a stable value fund is pretty high. Already low returns will be reduced by 0.7% to cover investment losses for other pilots.

 

The fees go down over time. But what's the point of highlighting this now? That section is already approved and in the UPA.

 

Thanks for pointing this out! With this, what’s the projected ROI…3-4%.

 

The majority of the ROI comes from the ability to tax shelter more of your income. The determination of the value of that benefit is a highly individual consideration.

It's in the title 'cash balance plan.' It's basically a savings account for your spill money so you don't have to pay your high marginal rate on it.

 

Shouldn't the company have picked up the tab for those fees?

 

you would have a much better return if you pay your ordinary income tax and invest it in the s&p 500 index then with draw at the long term capital gains rate of 15% of only your gains not the initial amount you put in. Prove me wrong…this loa is crap and the union should have never even allowed it.

 

Well if you retire during a major recession like 2008, then no, your basic mutual fund would not beat this. This is a conservative investment strategy, but will only makeup a tiny part of your retirement portfolio. 5-10k a year going into something like a bond account while decreasing your taxable income is not too bad when you are making $300-600k a year.

But yes, your union reps really failed you by not matching the Delta MBCBP.

 

With what money? I’ll say it again, there is no cash option for the company 17%, it’s RHA or CBP when it gets approved.

 

You’ve been told countless times as well. The money we aren’t forced to allocate to filling the 401k with the artificial cap that is placed on company spill into the PRAP with the LOA. It’s not in the contract, it’s not in DALs CBP and it has no place in ours.

 

A Tumi level dung-heap