Kev3188
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That's what it seems like...
IAM Stepping Up campaign
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That's naive to think that the pension wouldn't also be affected by the doings of wall st.
And to clarify- I agree with the 3 prong approach. I think the arguing of pensions being better than 401ks is moot. They both have their advantages, but if I HAD to choose one, I would favor the 401k. Maybe I shouldn't have used the word complete, but there is a lot control with a 401k.
And to clarify- I agree with the 3 prong approach. I think the arguing of pensions being better than 401ks is moot. They both have their advantages, but if I HAD to choose one, I would favor the 401k. Maybe I shouldn't have used the word complete, but there is a lot control with a 401k.
Kev3188
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Yes there is. I've noted why I prefer one over a pension before, so no need to (re) cover that ground, but you're right that the discussion shouldn't be about whether a DC or DB plan is better- it should be about the advantage(s) of workers having a real say in their future...
A pension can be effected by Wall Street, but not as much as a 401k.
Remember how many people lost thousands when US, and other airlines terminated their stock and people lost plenty in their 401ks because of that.
A DBP is guaranteed by the PBGC, a 401k is not.
The only control you have is which fund you invest in and that is restricted by most plans also.
And yes the three prong approach is the best way to go.
Remember how many people lost thousands when US, and other airlines terminated their stock and people lost plenty in their 401ks because of that.
A DBP is guaranteed by the PBGC, a 401k is not.
The only control you have is which fund you invest in and that is restricted by most plans also.
And yes the three prong approach is the best way to go.
WorldTraveler
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the US Dept. of Labor uses the term pensions to include Defined Contribution AND Defined Benefit Plans.
Both types are legitimately called pensions.
http://www.dol.gov/dol/topic/retirement/typesofplans.htm
yes, Q, a DB plan from the plan's perspective can be changed. The CBA for the workgroup does not effect the ability of the plan itself to be changed as long. There very well may be legal limitations in the CBA toward a pension but there are very separate processes to change the pension plan.
Both types are legitimately called pensions.
http://www.dol.gov/dol/topic/retirement/typesofplans.htm
yes, Q, a DB plan from the plan's perspective can be changed. The CBA for the workgroup does not effect the ability of the plan itself to be changed as long. There very well may be legal limitations in the CBA toward a pension but there are very separate processes to change the pension plan.
Kev3188
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Please not again with this?WorldTraveler said:
robbedagain
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actually wt the company cannot unilaterally change a pension unless the union agrees
I prefer the 3 prong approach too
I prefer the 3 prong approach too
Kev3188
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Before we waste dozens of posts while WT chases another "sliver of exclusivity," let's all make sure we're clear on what's being discussed. For the sake of this discussion, and context (and at the risk of being seeing as talking down):
Pension: A defined benefit (DB plan) that is paid at retirement. The monthly amount is usually defined by a negotiated multiplier based on years of service. That cannot be unilaterally changed out side of negotiations, nor can the amount-per-hour a company agrees to pay in for a multi-payer plan (like the IAMNPF). As WT notes, how a company (or IAM) funds the plan can be changed w/o labor's say, as long as the above covenants are still met.
401k: A defined contribution (DC plan) that is self funded, and generally tapped into at retirement. A company contribution separate from what an employee may pay in and a set percentage of matching funds (usually either dollar-for-dollar or 50%)up to a set amount may also be involved. As noted earlier, DL pays in 2% regardless of employee participation, and will match dollar-for-dollar (100%) up to another 5% of whatever an employee kicks in. In a CBA, those factors cannot be changed outside of negotiations. Obviously, the vagaries of the market cannot be controlled by either party, either. A company may change the fund options that are that are available to invest in unless otherwise negotiated.
PMNW employees (depending on hire date) currently have a frozen pension from NW, one that is in a sort of limbo from the IAMNPF, and a 401k. If you had a 401k at NW, it was transferred over from ING to Fidelity, and the respective fund options "mirrored" as best as possible until you had a chance to go in and tweak it to your liking.
At any rate, relevant to this thread, DL can do whatever they want, whenever they want. For example, a large portion of the plan options we have available to invest in were simply created out of thin air. No track record to research, no nothing. Tey can also alter the parameters of our plan at will. As Yoyo notes, it's pretty "sweet" right now, but that doesn't mean it will always be going forward...
Pension: A defined benefit (DB plan) that is paid at retirement. The monthly amount is usually defined by a negotiated multiplier based on years of service. That cannot be unilaterally changed out side of negotiations, nor can the amount-per-hour a company agrees to pay in for a multi-payer plan (like the IAMNPF). As WT notes, how a company (or IAM) funds the plan can be changed w/o labor's say, as long as the above covenants are still met.
401k: A defined contribution (DC plan) that is self funded, and generally tapped into at retirement. A company contribution separate from what an employee may pay in and a set percentage of matching funds (usually either dollar-for-dollar or 50%)up to a set amount may also be involved. As noted earlier, DL pays in 2% regardless of employee participation, and will match dollar-for-dollar (100%) up to another 5% of whatever an employee kicks in. In a CBA, those factors cannot be changed outside of negotiations. Obviously, the vagaries of the market cannot be controlled by either party, either. A company may change the fund options that are that are available to invest in unless otherwise negotiated.
PMNW employees (depending on hire date) currently have a frozen pension from NW, one that is in a sort of limbo from the IAMNPF, and a 401k. If you had a 401k at NW, it was transferred over from ING to Fidelity, and the respective fund options "mirrored" as best as possible until you had a chance to go in and tweak it to your liking.
At any rate, relevant to this thread, DL can do whatever they want, whenever they want. For example, a large portion of the plan options we have available to invest in were simply created out of thin air. No track record to research, no nothing. Tey can also alter the parameters of our plan at will. As Yoyo notes, it's pretty "sweet" right now, but that doesn't mean it will always be going forward...
robbedagain
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thank you kev for clarifying that
WorldTraveler
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Kev,
your clarification is helpful and only reinforces that use of the term "pension" to mean only DB plans is not only wrong but it creates confusion.
not sure what you mean by a "sliver of exclusivity" but just to be absolutely clear, you have NO CONTROL over how a DB plan is managed.
NONE.
And the plan itself can be changed... how that is negotiated with the union is a separate issue - if there are indeed separate plans for each unionized workgroup.
I'm also not sure what other options you think you would get in a 401K for a company with 70K employees, but I honestly would like to hear examples of other companies that offer more choices or why the ones you have don't deliver what you need to achieve your investment goals.
I don't expect you to accept "the market is doing well enough" but rather to have the tools that you need to manage your retirement. It is yours.
Just as with the whole union issue, I'm trying to understand where the grass really is greener.
your clarification is helpful and only reinforces that use of the term "pension" to mean only DB plans is not only wrong but it creates confusion.
not sure what you mean by a "sliver of exclusivity" but just to be absolutely clear, you have NO CONTROL over how a DB plan is managed.
NONE.
And the plan itself can be changed... how that is negotiated with the union is a separate issue - if there are indeed separate plans for each unionized workgroup.
I'm also not sure what other options you think you would get in a 401K for a company with 70K employees, but I honestly would like to hear examples of other companies that offer more choices or why the ones you have don't deliver what you need to achieve your investment goals.
I don't expect you to accept "the market is doing well enough" but rather to have the tools that you need to manage your retirement. It is yours.
Just as with the whole union issue, I'm trying to understand where the grass really is greener.
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