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FedEx Freight | The pension problem

Moninja said:
yrc-atm said:
1: What might or might happen in the future is uncertain. 2: Anything someone promises is not fulfilled until the promises comes true. 3: If it's run the same way as other pensions and social security, why wouldn't that pension plan end up insolvent just like those plans?
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The only reason social security is in the crapper is because congress kept "borrowing " from it. Left alone it would have been just fine.
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Never use the word " Assume" because you and I both know what it will make out of both of us....
Moninja said:
Wow. I'm sorry for inconveniencing you with this whole new thread and everything. I shouldn't have put you, or any of my fellow drivers, through that. But even considering that we won't be in the Central States pension fund, that still doesn't answer the question of what the pension situation would look like. As we get closer to this whole thing becoming a reality or not, and votes being scheduled, it's an important point. Not being part of one pension fund does not mean that a similarly structured pension fund would not experience the same difficulties. I guess I will explain the difference.
Cash-basis pension: You accumulate a certain amount of money and when you retire, that amount of money is yours.
Defined-benefit pension. You work a certain amount of time and when you retire you receive a set amount of money on a regular basis until you retire. Or the fund becomes insolvent or 50%+1 truckers who are financially illiterate vote to cut your pension or your pay or your benefits and we're all in this together.
Again. I would like to apologize to everyone for having put them through this extraneous thread. You did nothing to deserve this and I used to think I was a better person. Now I am not so sure. Perhaps if I was union we could work through this together???
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Moninja said:
Richard Cranium said:
Help an old fool out here, Moninja.
Now exactly how did that $3000 dollar a month pension shrink to $1000 or so a month?[/QUOTE

It's called inflation. The numbers stay the same but the earning power of your dollar decreases. Inflation has a compounded effect as it decreases your dollar in the same way that interest increases your actual dollars. Over time it can be devastating.

in 1984 the average home cost $79,000, hamburger was 99 cents/lb, average new car cost $7200. $3000/month in 1984 could go a lot further is my point. Inflation will kill you.

Anyway, my point is that without any consideration for future inflation, which I estimated very conservatively considering the QE the Fed has been putting on us, will destroy the value of a defined benefit pension. There has to be some consideration for the fact that everything will cost more when we retire than they do today.
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It's the weekend, shouldn't you be at your bunker dusting off your gold, function checking your weapons, and rotating your stockpile of can goods? The USD is actually rising in value. DXY Index Charts - U.S. Dollar Index (DXY) Interactive Index Charts - MarketWatch Deflation is happening and will continue for the foreseeable future.
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Moninja said:
Wow. I'm sorry for inconveniencing you with this whole new thread and everything. I shouldn't have put you, or any of my fellow drivers, through that. But even considering that we won't be in the Central States pension fund, that still doesn't answer the question of what the pension situation would look like. As we get closer to this whole thing becoming a reality or not, and votes being scheduled, it's an important point. Not being part of one pension fund does not mean that a similarly structured pension fund would not experience the same difficulties. I guess I will explain the difference.
Cash-basis pension: You accumulate a certain amount of money and when you retire, that amount of money is yours.
Defined-benefit pension. You work a certain amount of time and when you retire you receive a set amount of money on a regular basis until you retire. Or the fund becomes insolvent or 50%+1 truckers who are financially illiterate vote to cut your pension or your pay or your benefits and we're all in this together.
Again. I would like to apologize to everyone for having put them through this extraneous thread. You did nothing to deserve this and I used to think I was a better person. Now I am not so sure. Perhaps if I was union we could work through this together???
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.Keep posting BROTHER..
Dont be sorry Moninja.. Your thoughts and the Facts you supply are welcome here... the dont start new threads thing is being used like a stick in the eye ..to try and shut people of a different opinion down.
 
Moninja said:
yrc-atm said:
1: What might or might happen in the future is uncertain. 2: Anything someone promises is not fulfilled until the promises comes true. 3: If it's run the same way as other pensions and social security, why wouldn't that pension plan end up insolvent just like those plans?
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So then dont get into the pension plans. There are a lot of teamster companies that are not in the pension plans. They have 401k's or stand alone pension plans. You are assuming that by organizing you have to participate in the funds. Thats just an ignorant assumption. When you do your research you need to do it all and not just cherry pick what will make your argument valid
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purple headed promise said:
AND you forgot to mention that the pension funds are made up of bonds, stocks, mutual funds,etc....you know, the same stuff you claim is superior with the fedex way.. Maybe you can call our old supervisor that left out of frustration a few months ago. Worked here for 17 years. Fedex pension fund is 118 a month. What bill am I going to pay with that?
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1 weeks worth of gas for me
 
I thought UPS bought out of pension and players are in 401k. Look I'm not looking for everything but maybe instead of pension fed ex adds 2% more match on 401k . But I would like the Benifits UPS has it would make a lot of people's lives a lot easier.
 
yrc-atm said:
Moninja said:
So then dont get into the pension plans. There are a lot of teamster companies that are not in the pension plans. They have 401k's or stand alone pension plans. You are assuming that by organizing you have to participate in the funds. Thats just an ignorant assumption. When you do your research you need to do it all and not just cherry pick what will make your argument valid
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Point taken. I was just running the numbers to see where they stand up compared to what the union guys I've spoken with have been promised. The entire point of my post is to let people look at those numbers and compare and contrast. Union run pension funds are insolvent in general nationwide and we can disagree on why they are insolvent but not the fact that they are insolvent. I don't want to get caught up in that and, frankly, I don't want my co-workers to get caught up in that either. My ignorance lies with not knowing everything and my argument supports what I do know. Cherry picking is really not fair considering that I ran the numbers using a 50,000 income and, using Warren Buffett's projections, a conservative stock market return.
At $75000 income, constant investment, 6% growth, you would have:
30 years: $855,224,
25 years: $596,592,
20 years: $403,326. Please note again that I did not consider dividends which can quite substantially alter the value of an investment... long term I also did not consider the company increasing their pension investment over time to max out @7% plus 3.5% match on your 401K. I didn't consider pay raises either.

If you wanted that to last 20 years and maintain the portfolio, even after only 20 years employment at FedEx Freight using the plan they offer now, you would have a pension payout of $2825/month for 20 years. Until you are 85 years old if you retire at 65. This is more generous than the present union contracts and your family keeps the remaining balance. It does require the driver to invest some into his or her own retirement. I was hardly cherry picking. I was just stating the facts that defined benefit pension plans don't work for a variety of reasons. Reasons that I stated. I wanted to give my fellow drivers a chance to understand. If that influences anyone either way, or if it influences what we drivers bring the to the table for negotiation if the union is voted in, that's probably better.

Facts are facts. Even the conservative numbers I ran on the initial post makes our pension plan superior to the pension plans that are offered to drivers at other carriers. Also, I did not mention the study that showed the average driver dies before they are 62 years old. I considered it immaterial but really, it seems pretty important if your're probably going to die before you see your pension anyway. At least with our plan the remaining balance reverts to your next-of-kin.
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marktkm1971 said:
I thought UPS bought out of pension and players are in 401k. Look I'm not looking for everything but maybe instead of pension fed ex adds 2% more match on 401k . But I would like the Benifits UPS has it would make a lot of people's lives a lot easier.
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Fed Ex puts 3% in your pension right now which increases up to 7% with age+years of service. So right now FedEx puts 6.5% toward junior drivers and 10.5% toward the senior drivers retirements. If they increase the 401K match to 5.5% of your income and eliminate pensions... You'd be sticking it to the senior drivers the hardest.
 
Just a dumb old guy here, but can we not keep comparing apples to oranges?

You have stated that the teamster pension, which costs you nothing, will only be worth $1200 a month adjusted for inflation.
Is only union money affected by inflation?
Your analysis of what the company provides doesnt show any effects of inflation. Adjusting for inflation, doesn't your 570,000 become more like 190,000?
Is it magically protected? RC is rolling his eyes as I type this.
Also, you indicate a six percent or greater growth factor for our pension. That is simply not true as our cash pension earns 1%.
Your figure is also dependent on a large input of money from the employee whereas the union pension does not require funding by the employee.

I think I will gladly pay dues, write it off on my taxes and call it prepaid legal in the event of BS disciplinary actions.

But hey, what do I know I'm just an old dumb guy.
 
johndeere4020 said:
How do you think your pension would work?
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Just like the defined benefit pensions that I already have. Dependent upon hours worked and contractual contribution rate in one case and years worked and highest five years of earnings in the other case.

The point I was trying to make is that the poster was discounting one pension due to inflation while mid-stating earning potential and no reduction in buying power when touting his plan.

Our current cash plan is laughable at the current contribution rate.
A figure of 15% being contributed would get my attention.
 
Richard Cranium said:
Just like the defined benefit pensions that I already have. Dependent upon hours worked and contractual contribution rate in one case and years worked and highest five years of earnings in the other case.

The point I was trying to make is that the poster was discounting one pension due to inflation while mid-stating earning potential and no reduction in buying power when touting his plan.

Our current cash plan is laughable at the current contribution rate.
A figure of 15% being contributed would get my attention.
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easy there buddy, not all teamsters retirement plans work that way I'm just curious on some thoughts about it.
 
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