FedEx Freight | The pension problem

[SwampRatt]

My math was based on a number lower than that even and higher earning drivers will naturally have a lot more to lose if we end up with a UPSF style contract of $105/month for every year of service. Besides the fact of which the remainder will fall to your next-of-kin upon your death. Oh. And I am nuts. That's been established.

Your math (in this entire thread) assumes:

1) the UPSF driver does not contribute to anything of his own retirement, either through 401k or IRA, even though he makes'possibly 10% more (+/-) every week.
2) The FXFE driver contributes at least 6% too his own retirement, reducing his current spendable income by another 6%, for the next 20-30 years.
3) That the pension should be considered as part of the inheritance left to your heirs, when (perhaps) term life insurance would provide a better return, in the event of death, providing value from day 1, not only after 20-30 years.
4) all value/cost of union dues are contributed to
the retirement equation, rather than factoring in
the other benefits
You make valid arguments, and points, but to take one aspect of the "contract", without factoring in the totality of the contract, is misleading, IMHO.

 

[Moninja]

Your math (in this entire thread) assumes:

1) the UPSF driver does not contribute to anything of his own retirement, either through 401k or IRA, even though he makes'possibly 10% more (+/-) every week.
2) The FXFE driver contributes at least 6% too his own retirement, reducing his current spendable income by another 6%, for the next 20-30 years.
3) That the pension should be considered as part of the inheritance left to your heirs, when (perhaps) term life insurance would provide a better return, in the event of death, providing value from day 1, not only after 20-30 years.

You make valid arguments, and points, but to take one aspect of the "contract", without factoring in the totality of the contract, is misleading, IMHO.

I just wish you didn't think I was trying to mislead anyone. I'm not and I'm just a stupid truck driver. I'm offering my perspective and opinions and supporting those opinions with facts. What you have done, sir, is contribute to the discussion by offering a valid counterpoint. I could take issue with some of the finer points of what you've said but that would miss the bigger point. Because I'm not trying to prove myself right, I'll say you're right on all of them. There are probably many more advantages to bringing in a union and having them negotiate a UPSF style contract for us than just the ones you mention. There are probably many things we would lose, that we have right now, if we unionize.

Obviously that still leaves the issue of the flexibility I have with my retirement account. Having life insurance is common sense and not something I would need if I didn't have control of my pension. I do understand your point, however, that you don't consider any unused pension as part of the legacy you will leave to your heirs. And even if you wanted to, it wouldn't weigh heavily against the fact that UPSF makes more money and doesn't have to contribute anything towards their retirement. It's not my thread. It's our thread driver. You seem to have made up your mind about the union.

 

[Crystal]

I think it's important to have as much information as possible before I make a decision on something. Reading your posts it was clear that I wasn't dealing with a logical person. I didn't know if you were actually insane or just an ideologue. It's hard to tell at first glance and I wanted to give you the benefit of the doubt instead of assuming that your sanity was the problem.

Let me see if I've got this right. My sanity was at issue before you would defend your post. You stated it was a fact that all union run pension funds are insolvent and I asked you to name one. I even linked the well funded Western States fund to counter your so called fact. But instead of you simply defending your claim you research my posts from other forums in an attempt to discredit me. You question my sanity, logic and my politics. You ask rhetorical questions about my union pension fund which will never be an issue should FedEx drivers decide to join a union. You go to great lengths in your post #84 to attack my credibility with statements like

I can tell you what. I get that you people don't want to allow any other viewpoint out there except yours. Silence dissenters. Union yes. Class warfare. Social justice. Racial tension. Equal pay. Blah blah blah. You are obviously pro-union. Why are you even muddling up the FedEx driver forum post anyway?

I find it strange that by my asking you a simple question you claim I'm muddling your post...... You go on to question and attack my pension fund knowing full well that I never had to contribute even 1 penny out of my own pocket for that union benefit that now accounts for 67% of my gross monthly income.

You're probably just jealous because the plan we have will help us retire more comfortably, and in our own time frame, than the union plan you got. What did your union contract offer you when you signed up??? $50/month? Probably sounded good back in the 60's didn't it? Inflation sure blew that up. Oh,

This will be my last post on this thread unless I feel the need to defend future personal attacks instead of facts. But before I end it I can't let your buddy's personal attack go unanswered

Crystal, you are a union agitator and that's why Moninja has not directly responded to you. He has stated repeatedly that he's speaking based on what he's been told by union representatives in comparison with his own calculations regarding the FedEx pension. He has also stated several times that he is unsure if what he was told by said union representatives is true or if his calculations pan out. His choosing to ignore your one grievance with his post is equal to your choosing to ignore his disclaimers.

This is a discussion/debate regarding pensions, and should be left as such. If you don't have anything to contribute to the discussion between employees weighing the pros and cons of the pension plans presented to them, please ignore this thread instead of attempting to pester the OP and calling him a liar when he's already disclaimed his knowledge and calculations as being theoretical.

If I'm, in your opinion, a union agitator just because I questioned and then challenged him on his offering opinions and projections as being facts without proof then I'm guilty as charged. And if union representatives told him that all union pension funds are insolvent then I'll challenge them also. And I didn't choose to ignore his disclaimers because I don't think they can be applied to something that he claimed to be actual facts......................


I guess you don't consider questioning statements presented as facts as my contributing to the discussion. And I didn't actually call him a liar. On that point I'll let you people spin your choice of words in your attempt to keep the union out of FedEx.

 

[Moninja]

Crystal I'm done reading your posts. I didn't even read this one. You've offered nothing to the conversation and you're not a FedEx driver. I'm trying to have a debate with my fellow FedEx drivers. I'm going to ignore everything you ever say from now on ever again. OK. I'm sorry about your situation and I hope it gets better. Now please go find some other thread to troll.

 

[Crystal]

Crystal I'm done reading your posts. I didn't even read this one. You've offered nothing to the conversation and you're not a FedEx driver. I'm trying to have a debate with my fellow FedEx drivers. I'm going to ignore everything you ever say from now on ever again. OK. I'm sorry about your situation and I hope it gets better. Now please go find some other thread to troll.

Now we can add troll to the list of things you have accused me of being. Or are you disclaiming that too? Troll that's hardly original and a poor excuse for a cop out. I guess you couldn't find a Teamsters MEPF that was insolvent as you claimed to be a fact.

 

[citydog]

It's a shame when someone posts facts all yall pro Union get yor panties in a wad.

 

[Moninja]

OK so I reran some numbers.

No accounting for inflation, modest growth, no raises, apples to apples. I'm not trying to be tricky here. I'm just trying to figure this whole thing out. I wish I knew how to attach these spreadsheets.

OBJECTIVE:
To determine how the financial aspects of FedEx Freight’s retirement plan compares with the retirement plan that is presently available to the drivers at UPS Freight.

There are inherent problems with this comparison. I will miss some of these issues but in the interest of fairness I will list the issues that I can think of.

Issues that make FedEx’s Pension more desirable:
• Inflation: This will have a greater effect on UPS pension because there is no allowance for growth.
• Growth: FedEx Freight’s pension is currently growing at 1%/quarter, which is low in historical standards, high for today’s standards, and increases the value of the pension over time.
• Ownership: FedEx Freight’s retirement package is entirely portable and can be rolled over, invested into annuity, etc. and passed on to your survivors.
• Investment: FedEx requires a driver to invest in their retirements to receive maximum company match. This requires drivers to focus some attention on their long-term financial goals.
• Income: Drivers who earn more money receive a more generous company pension and 401k investment.

Issues that make UPSF’s Pension more desirable:
• Predictable income: UPS Freight’s pension offers a predictable income for retirement.
• Ownership: UPS Freight drivers do not need to manage their retirement accounts because a union account director manages it for them.
• Investment: UPS drivers do not need to invest anything into their pension plan to receive maximum company pension.
• Income: Because UPS drivers are presently earning more per/hour&mile, this extra income can be invested today.
• Deflation: In this unlikely event, a defined benefit pension will be very beneficial.

Issues that will have an effect on either account:
• Inflation: While it will have a greater effect on the UPS Pension plan, it will also have an effect on the net value of every dollar. I did not adjust for inflation.
• Growth: If the market goes up and interest rates go up, the FedEx retirement package is better. If the market goes down and interest rates stay low, UPS Freight’s retirement offers stability and certainty.

Comparing Fed Ex Freight's pension with UPSF Pension Based on a 35 year old driver $50,000 income, no raises, 6% stock growth and 4.1% FedEx Pension growth. Investing guesstimated union dues in retirement account. Each driver invests 6% in a retirement account. After 30 years of employment:
UPSF:
$3,150/month pension payment, $250,429.72 in 401K
FXF:
$113,257.33 total pension, $250,429.72 (individual contribution)+ $146,084.00 (company match) in 401K, $59,268.37 (union dues invested in IRA) = total retirement package $569,039.43

The apples to apples difference is $3150/month versus $318,069.71 cash

Comparing Fed Ex Freight's pension with UPSF Pension Based on a 35 year old driver $75,000 income, no raises, 6% stock growth and 4.1% FedEx Pension growth. Investing guesstimated union dues in retirement account. Each driver invests 6% in a retirement account. After 30 years of employment:
UPSF:
$3,150/month pension payment, $375,644.58 in 401K
FXF:
$169,886 total pension, $375,644.58 (individual contribution)+ $219,126.01 (company match) in 401K, $59,268.37 (union dues invested in IRA) = total retirement package $823,924.26

The apples to apples difference is $3150/month versus $448,280.38 cash

Comparing Fed Ex Freight's pension with UPSF Pension Based on a 35 year old driver $100,000 income, no raises, 6% stock growth and 4.1% FedEx Pension growth. Investing guesstimated union dues in retirement account. Each driver invests 6% in a retirement account. After 30 years of employment:
UPSF:
$3,150/month pension payment, $500,859.44 in 401K
FXF:
$226,514.67 total pension, $500,859.44 (individual contribution)+ $292,168.01 (company match) in 401K, $59,268.37 (union dues invested in IRA) = total retirement package $1,078,810.49

The apples to apples difference is $3150/month versus $577,951.05 cash.

Even smallish increases in wages and income over time will have a more positive effect on FedEx's retirement plan and will have a reduced effect on UPSF freight's defined benefit pension. This is because the increased income will mean an increased investment into your retirement package.

 

[Crystal]

It's a shame when someone posts facts all yall pro Union get yor panties in a wad.

No it's a shame when someone tries to pass off their opinions and false information and claim them to be facts. And it's also a shame when someone has to resort to attacking the poster instead of addressing the contents of the post.

citydog maybe you would like to provide the proof to what you claim are his facts.

 

[Moninja]

Crystal:
LMAO. You've just proven my point. You actually sent me a link to the Western Conference of Teamster Pension funds. I looked at their financial statements. Feel free to look them up yourself and then come back to me and tell me that those numbers are just my opinion. I didn't audit them nor did I prepare their financial statements. They are insolvent. By that I mean they have more liabilities than assets. I get it. You're not financially literate. You seem to be unable to differentiate between bankruptcy and insolvency.
I'll help you out:
Insolvent: I owe $10,000 and I have $8,000.
Bankrupt: I owe $1,000 and I have $0.
Most of the time pensions won't let the situation get to $0. They'll lower the benefit payouts to present and future retirees. Another example is the United States Government. Insolvent but still paying their bills. They're in debt and figure all those workers can just have their contributions increased (taxes go up) and everything will work out. Union pension funds are struggling because not enough people are joining unions to take their money to reduce the insolvency issue.
So. I'm very sorry that you are in a situation like this. I really am. They promised you something that they might not be able to fulfill. That's very difficult to fathom on a fixed income. What we're trying to discuss here is what will work best for us. You want us to pool in with you so you can get some of what we make just like the person who retired when you were working got yours. That's called a Ponzi scheme and is generally a bad thing to get involved in. Unless you're running the scheme. Which the union does. OK. So now I understand what you're dealing with now go away.
We're trying to discuss our situation not define polysyllabic words for you. We don't want to end up involved in an insolvent retirement ourselves.

 

[Crystal]

Crystal:
LMAO. You've just proven my point. You actually sent me a link to the Western Conference of Teamster Pension funds. I looked at their financial statements. Feel free to look them up yourself and then come back to me and tell me that those numbers are just my opinion. I didn't audit them nor did I prepare their financial statements. They are insolvent. By that I mean they have more liabilities than assets. I get it. You're not financially literate. You seem to be unable to differentiate between bankruptcy and insolvency.
.

The WCTPFs funding percentage is at 91.5% and it is in great financial shape in accordance with ERISA and the PPA. If you knew anything about MEPFs you would know it's a disadvantage if they were to be 100% funded. They are not insolvent. You can spin the word all you want but you can't change it's meaning by applying it to pension funds. Maybe you could get a job rewriting definitions for Merriam Webster

Definition of INSOLVENT


1

a : unable to pay debts as they fall due in the usual course of business

b : having liabilities in excess of a reasonable market value of assets held

Person or firm whose liabilities exceed the value of owned assets. It is commonly illegal for the directors of an insolvent firm to continue to trade after becoming aware of their insolvent position. If despite their knowledge of the firm's insolvent position they do not refrain from receiving goods on credit, they may be charged with fraudulent misrepresentation of facts and may become personally liable for the firm's debts. If a seller discovers the insolvent status of a buyer after making a sale, the seller can reclaim the goods within a certain period.

Read more: What is insolvent? definition and meaning

Insolvency
An incapacity to pay debts upon the date when they become due in the ordinary course of business; the condition of an individual whose property and assets are inadequate to discharge the person's debts.

Now you can get back to your personal attacks against me

 

[johndeere4020]

No it's a shame when someone tries to pass off their opinions and false information and claim them to be facts. And it's also a shame when someone has to resort to attacking the poster instead of addressing the contents of the post.

citydog maybe you would like to provide the proof to what you claim are his facts.

What about the links that I posted, you ignored them.

 

[Crystal]

What about the links that I posted, you ignored them.

No I didn't ignore it actually I've seen it posted a few times .But how is it relevant to those funds being insolvent? I never once said that the pension funds aren't in trouble. Hell even NASA's retirement fund is underfunded by the Federal Government. My only claim was and still is that the Teamster's MEPFs are not insolvent as was stated as being a fact by this threads starter.

 

[Moninja]

Now you can get back to your personal attacks against me

Look just go away. You're not adding anything to the conversation. Rule 2: Never go outside of the area of your expertise. Clearly you're way over your head here. Rule 3: When possible, go outside of the expertise of the other person. You're probably used to baffling the simple minded by altering the definition of words to make them suit you. Rule 8: Keep the pressure on and never let up. Rule 10: Keep the pressure on to the point of exasperating the opposition with nonsense and be the victim so others will find you sympathetic and side against your opposition. Rule 11: Never let the opposition score points because you don't have a solution. Rule 12: Personalize everything. You're a textbook union agitator.

I'm not stupid. You're mucking up the post so people don't know what's going on. It's no coincidence that you attack a message that doesn't support the union. If you are insane take your meds. You first say that the pension funds are not insolvent, then you link me to an insolvent fund to show how healthy they are, then you excuse away the insolvency by saying that insolvency is good. You've done an outstanding job of showing what unions can do.

 

[Moninja]

Youre using apples and oranges math putting an exaggerated negative spin on the union pension and an exagerrated positive spin on FedEx pension. Nice try. Just cause you did a lot of math doesn't mean the checkbook balances. Besides, you guys would negotiate your own pension plan not be grandfathered into Central States. Don't let yourself become institutionalized to the point that you just continue to blindly put your faith in the good - heartedness of FredEx mgmt. Why would you not want to be able to negotiate your work rules, pay, benefits etc... ?

I redid the math. Apples to apples. Post 107

 

[Moninja]

How about we really make it apples and apples.
We've already established the value of a teamster pension at 20, 25 and 30 years.
We have even established how little it will be worth adjusted for inflation.
So do an old fool a favor please.
Remove all the numbers for the 401(k) including the company match.
Okay now figure the company pension for a 25-year-old male starting at 3% doing a normal progression to 7% and run it for 20, 25 and 30 years.
Now please take this number and adjust for inflation.
Maybe then we will finally be able to compare apples to apples.

Fair enough. Post #107. I tried to make it apples to apples as best as I could. I couldn't attach the spreadsheets or you could look at the numbers by year.

 

[Crazy Trucker]

I redid the math. Apples to apples. Post 107

I would say apples to rat turds lol. You are assuming the stock market does well which is crap in my opinion just look at the 200 hundred and some dip it took yesterday never know it could crash again on mon who knows. I will take the guaranteed retirement any day and its not even a close comparison imo.

 

[princess]

Seriously Dude.... Calm down...go have a beer or something.

I'm not stupid. You're mucking up the post so people don't know what's going on.

 

[Moninja]

I have no problem with that. I'm of the opinion that the market is due to crash very soon because of fed monetary policy. I'm also of the opinion that inflation is due to increase rather significantly rather soon. So there really are 2 sides to that. You're taking the safe side and I totally respect that. I understand that the union does offer more job security as well... we'll see how this plays out.

 

[Moninja]

Seriously Dude.... Calm down...go have a beer or something.

Good call. Thank you princess.

 

[frtshaker]

No accounting for inflation, modest growth, no raises, apples to apples. I'm not trying to be tricky here. I'm just trying to figure this whole thing out. I wish I knew how to attach these spreadsheets.

OBJECTIVE:
To determine how the financial aspects of FedEx Freight’s retirement plan compares with the retirement plan that is presently available to the drivers at UPS Freight.

There are inherent problems with this comparison. I will miss some of these issues but in the interest of fairness I will list the issues that I can think of.

Issues that make FedEx’s Pension more desirable:
• Inflation: This will have a greater effect on UPS pension because there is no allowance for growth.
• Growth: FedEx Freight’s pension is currently growing at 1%/quarter, which is low in historical standards, high for today’s standards, and increases the value of the pension over time.
• Ownership: FedEx Freight’s retirement package is entirely portable and can be rolled over, invested into annuity, etc. and passed on to your survivors.
• Investment: FedEx requires a driver to invest in their retirements to receive maximum company match. This requires drivers to focus some attention on their long-term financial goals.
• Income: Drivers who earn more money receive a more generous company pension and 401k investment.

Issues that make UPSF’s Pension more desirable:
• Predictable income: UPS Freight’s pension offers a predictable income for retirement.
• Ownership: UPS Freight drivers do not need to manage their retirement accounts because a union account director manages it for them.
• Investment: UPS drivers do not need to invest anything into their pension plan to receive maximum company pension.
• Income: Because UPS drivers are presently earning more per/hour&mile, this extra income can be invested today.
• Deflation: In this unlikely event, a defined benefit pension will be very beneficial.

Issues that will have an effect on either account:
• Inflation: While it will have a greater effect on the UPS Pension plan, it will also have an effect on the net value of every dollar. I did not adjust for inflation.
• Growth: If the market goes up and interest rates go up, the FedEx retirement package is better. If the market goes down and interest rates stay low, UPS Freight’s retirement offers stability and certainty.

Comparing Fed Ex Freight's pension with UPSF Pension Based on a 35 year old driver $50,000 income, no raises, 6% stock growth and 4.1% FedEx Pension growth. Investing guesstimated union dues in retirement account. Each driver invests 6% in a retirement account. After 30 years of employment:
UPSF:
$3,150/month pension payment, $250,429.72 in 401K
FXF:
$113,257.33 total pension, $250,429.72 (individual contribution)+ $146,084.00 (company match) in 401K, $59,268.37 (union dues invested in IRA) = total retirement package $569,039.43

The apples to apples difference is $3150/month versus $318,069.71 cash

Comparing Fed Ex Freight's pension with UPSF Pension Based on a 35 year old driver $75,000 income, no raises, 6% stock growth and 4.1% FedEx Pension growth. Investing guesstimated union dues in retirement account. Each driver invests 6% in a retirement account. After 30 years of employment:
UPSF:
$3,150/month pension payment, $375,644.58 in 401K
FXF:
$169,886 total pension, $375,644.58 (individual contribution)+ $219,126.01 (company match) in 401K, $59,268.37 (union dues invested in IRA) = total retirement package $823,924.26

The apples to apples difference is $3150/month versus $448,280.38 cash

Comparing Fed Ex Freight's pension with UPSF Pension Based on a 35 year old driver $100,000 income, no raises, 6% stock growth and 4.1% FedEx Pension growth. Investing guesstimated union dues in retirement account. Each driver invests 6% in a retirement account. After 30 years of employment:
UPSF:
$3,150/month pension payment, $500,859.44 in 401K
FXF:
$226,514.67 total pension, $500,859.44 (individual contribution)+ $292,168.01 (company match) in 401K, $59,268.37 (union dues invested in IRA) = total retirement package $1,078,810.49

The apples to apples difference is $3150/month versus $577,951.05 cash.

Even smallish increases in wages and income over time will have a more positive effect on FedEx's retirement plan and will have a reduced effect on UPSF freight's defined benefit pension. This is because the increased income will mean an increased investment into your retirement package.

Two problems with your math. One, you cannot assume 6% market gains on a consistent basis. Two, suppose the FXF driver outlives his savings, whereas the UPSF driver is guaranteed a lifetime pension? I knew someone that was UAW retired and collected his pension longer than he worked there. The way you have it figured the using 3150 a month you are assuming the UPSF driver dies shortly after retiring which is not always the case. Furthermore, the figure of 3150 a month is the rate now, why do you assume that will not be negotiated higher in the future?