ABF | 401(k)'s as a retirement vehicle

Good Man!

But,....I am just the opposite......I have the debt,...the mortgage,...the car payment,.......and put 4 children through college,...(..that remains a lasting legacy..).....

Now I've got an arm that regularly clicks and shoots pain,....and a hand with no feeling in my fingertips.

I've been retired for more than a year at 63. Options were to keep working and risk more "physical" damage,...or retire.

Which one of us would you say is the more ..."Typical"...of people our age,...... Financial-wise?

...(...My work history includes 9 carriers going bankrupt under me,...a 9 year stint as an O/O,.....and finally ABF..)...

Was I stupendously Unlucky?.......or Financially Stupid?........Or (Third Option) , Fairly typical of anyone in the trucking industry, post-deregulation?

I would say you're more typical. Putting 4 kids through college is a tough nut to swallow.
 
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Be conscientious of your income level before dipping into your 401k. The idea is to keep your income at a level that is below the the maximum at each breakpoint in taxable income. It is important to consult a tax professional to keep your tax burden at a minimum in retirement.
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Great info El but I want to just focus on one point while I'm preparing my 10,000 page response to Canary about 401-K's.

Your comment about "breakpoints" in taxable income is hugely misunderstood by many people. I've heard people say many times that they refuse overtime because that might force them into a higher tax bracket. ABSOLUTELY, COMPLETELY WRONG!!!!! The higher tax rate at any "breakpoint" only applies to the next/additional dollars of additional income, not to all the income. So many people misunderstand that and think additional earnings actually cost them money because of the higher tax bracket. People should look up and understand marginal tax rates - "The marginal tax rate is the percentage of tax applied to your income for each tax bracket in which you qualify. In essence, the marginal tax rate is the percentage taken from your next dollar of taxable income above a pre-defined income threshold."

Now back to working on page 7 of my 10,000 page response to Canary...
 
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If on retirement day you have $800,000 in a 401K you should be invested in CDs and or bonds to get a 5% return ($40,000 annually) and don't touch the principal until you have to (age 70 1/2). Then draw it down over 20 -25 years.
Brother, that is exactly my point. Plan your retirement. Ask questions. Talk with your bank and a financial planner. If you follow the rules, the game is set up for you to win. Don't follow the rules the government taxes you (penalizes you). So do the research and take the win.
 
Now,.....what about the news stories of guys returning to the workforce in their late '70's.....because tey ran out of money?
Brother Canary, there was story on CNBC a couple of month ago about older American's who have retired (67 yrs old and older ) and who where returning to the workforce. According to the report, many of these retirees are getting back into the workforce because wages have reached their expectations of what wages should be. For example, would you go back to work if ABF was willing to pay you $10 hr? No, probably not. But if wages where $55 an hour would you consider returning for a few years?

I would like to point out there is nothing wrong with working to 70yrs old or older. Personally, I have every intention of working until the day I die. It probably (most likely and heaven forbid) won't be driving truck or with ABF.

Why Are So Many People Returning to the Daily Grind?
According to the Federal Reserve study, “We suspect that they [retirees] either do not think of retirement as the state of no longer working or they find that, unexpectedly, they do not like not working and would rather return to work.”

The study looked at many factors that may contribute to a return to work including why they stopped working initially and whether or not they reported “liking” retirement.

It appears that many people who return to work after retirement just needed to get over some degree of burnout from the job. However, the study found that the motivation to work after retirement may depend on income levels:

  • People in the lowest income percentile usually return to work because their need for more income.

  • People in the highest income percentile might not need the income, but it seems that they want to take advantage of their skills and the opportunity to make money.
Torsten Slok, chief international economist at Deutsche Bank Securities suggests about the highest income percentile, “They have money-making skills, networks and qualifications, and one day they get a call asking them to work in a job that might be less stressful than the one they had. Also, life spans are getting longer, and people don’t want to spend decades just playing golf without being more fully engaged.”
 
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Great info El but I want to just focus on one point while I'm preparing my 10,000 page response to Canary about 401-K's.

Your comment about "breakpoints" in taxable income is hugely misunderstood by many people. I've heard people say many times that they refuse overtime because that might force them into a higher tax bracket. ABSOLUTELY, COMPLETELY WRONG!!!!! The higher tax rate at any "breakpoint" only applies to the next/additional dollars of additional income, not to all the income. So many people misunderstand that and think additional earnings actually cost them money because of the higher tax bracket. People should look up and understand marginal tax rates - "The marginal tax rate is the percentage of tax applied to your income for each tax bracket in which you qualify. In essence, the marginal tax rate is the percentage taken from your next dollar of taxable income above a pre-defined income threshold."

Now back to working on page 7 of my 10,000 page response to Canary...


And I promise I will enjoy every page of it.........Might not agree,.....But I enjoy vigorous debate, Brother........
 
Brother Canary, there was story on CNBC a couple of month ago about older American's who have retired (67 yrs old and older ) and who where returning to the workforce. According to the report, many of these retirees are getting back into the workforce because wages have reached their expectations of what wages should be. For example, would you go back to work if ABF was willing to pay you $10 hr? No, probably not. But if wages where $55 an hour would you consider returning for a few years?

I would like to point out there is nothing wrong with working to 70yrs old or older. Personally, I have every intention of working until the day I die. It probably (most likely and heaven forbid) won't be driving truck or with ABF.

Why Are So Many People Returning to the Daily Grind?
According to the Federal Reserve study, “We suspect that they [retirees] either do not think of retirement as the state of no longer working or they find that, unexpectedly, they do not like not working and would rather return to work.”

The study looked at many factors that may contribute to a return to work including why they stopped working initially and whether or not they reported “liking” retirement.

It appears that many people who return to work after retirement just needed to get over some degree of burnout from the job. However, the study found that the motivation to work after retirement may depend on income levels:

  • People in the lowest income percentile usually return to work because their need for more income.

  • People in the highest income percentile might not need the income, but it seems that they want to take advantage of their skills and the opportunity to make money.
Torsten Slok, chief international economist at Deutsche Bank Securities suggests about the highest income percentile, “They have money-making skills, networks and qualifications, and one day they get a call asking them to work in a job that might be less stressful than the one they had. Also, life spans are getting longer, and people don’t want to spend decades just playing golf without being more fully engaged.”


Good, reasonable points.

I'm not in the highest income percentile,..........but I'll be standing by for that $55 an hour truck driving call.

I think I'll still turn them down.....
 
Good, reasonable points.

I'm not in the highest income percentile,..........but I'll be standing by for that $55 an hour truck driving call.

I think I'll still turn them down.....
We have a "supplemental" road board (casual) here in Atlanta. It has about 25 drivers on it and almost all are retired road drivers. Not one has said they needed the money but do it for extra money or because they are bored. They could get on full time or they could have stayed full time employees instead of retiring. Also, it seems to be company policy to contact retired road drivers and ask them to be on the supplemental board.
 
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We have a "supplemental" road board (casual) here in Atlanta. It has about 25 drivers on it and almost all are retired road drivers. Not one has said they needed the money but do it for extra money or because they are bored. They could get on full time or they could have stayed full time employees instead of retiring. Also, it seems to be company policy to contact retired road drivers and ask them to be on the supplemental board.


There's a certain point where you have to admit your ....skills and reflexes aren't as sharp as they once were. This....point.....is magnified if you are in public conveyance, or operating any sort of commercial vehicle.

I don't want to make the newspapers by being behind the wheel of a commercial vehicle involved in an accident.....especially as a "retired" driver. Do you imagine how much hay would be made by the media if there was a fatality,.......no matter who was at fault?

The insurance companies will bend heaven and earth to hang the anchor of responsibility on your neck....."Too old,...not quick enough,.....possible medical condition..."......No, Thank you.........If I go to work because I'm "bored",......or need money,.........I'll do it on private property,..In-House,....where I can only be fired, and not sued to lose my house......

Believe me,...I know what I'm talking about.........I was involved in a property-damaging accident with low wires. I was going 3 mph on a residential street 3 blocks long........We went to court,....the cable company blamed us,...the phone company blamed the cable company,....and my employer blamed both of them........


Not My Problem,........or so I thought.

2 years later,...I went to re-finance my house,....and I found out there was an $8,000 lien on my property,.......imposed by the insurance carrier,...because my employer refused to even talk with them,...citing the national low wire standards alleviated any liability for the company....

Insurance people didn't care,.........Money talks,.....and they sued everyone involved,....and as the person with his hands on the wheel,.....I was Lawsuit #1......

The company didn't even inform me that I was involved in litigation,......and the contract absolutely absolved me of any personal responsibility,...(..as long as I don't commit a felony behind the wheel..).....as I was performing my duties as an agent of the company.

I practically kicked in the TM's door and demanded an immediate resolution....I got it,....and the companies' attorneys called the bank while I was in his office.......

Now,..........Stuff like this goes on in a Union carrier,.........Imagine what goes on at a non-Union carrier, where you have NO contractual language,.......Al this does is prove to me that ....your driving skills do NOT matter,.........What matters to employers is your WILLINGNESS to take all responsibility, once you leave company property........

Drive truck when I'm retired? No thanks..........I'm not laying my head on THAT chopping block...........
 
There's a certain point where you have to admit your ....skills and reflexes aren't as sharp as they once were. This....point.....is magnified if you are in public conveyance, or operating any sort of commercial vehicle.

I don't want to make the newspapers by being behind the wheel of a commercial vehicle involved in an accident.....especially as a "retired" driver. Do you imagine how much hay would be made by the media if there was a fatality,.......no matter who was at fault?

The insurance companies will bend heaven and earth to hang the anchor of responsibility on your neck....."Too old,...not quick enough,.....possible medical condition..."......No, Thank you.........If I go to work because I'm "bored",......or need money,.........I'll do it on private property,..In-House,....where I can only be fired, and not sued to lose my house......

Believe me,...I know what I'm talking about.........I was involved in a property-damaging accident with low wires. I was going 3 mph on a residential street 3 blocks long........We went to court,....the cable company blamed us,...the phone company blamed the cable company,....and my employer blamed both of them........


Not My Problem,........or so I thought.

2 years later,...I went to re-finance my house,....and I found out there was an $8,000 lien on my property,.......imposed by the insurance carrier,...because my employer refused to even talk with them,...citing the national low wire standards alleviated any liability for the company....

Insurance people didn't care,.........Money talks,.....and they sued everyone involved,....and as the person with his hands on the wheel,.....I was Lawsuit #1......

The company didn't even inform me that I was involved in litigation,......and the contract absolutely absolved me of any personal responsibility,...(..as long as I don't commit a felony behind the wheel..).....as I was performing my duties as an agent of the company.

I practically kicked in the TM's door and demanded an immediate resolution....I got it,....and the companies' attorneys called the bank while I was in his office.......

Now,..........Stuff like this goes on in a Union carrier,.........Imagine what goes on at a non-Union carrier, where you have NO contractual language,.......Al this does is prove to me that ....your driving skills do NOT matter,.........What matters to employers is your WILLINGNESS to take all responsibility, once you leave company property........

Drive truck when I'm retired? No thanks..........I'm not laying my head on THAT chopping block...........
The "trial Lawyers" would have a field day (unfortunately)
 
There's a certain point where you have to admit your ....skills and reflexes aren't as sharp as they once were. This....point.....is magnified if you are in public conveyance, or operating any sort of commercial vehicle.

I don't want to make the newspapers by being behind the wheel of a commercial vehicle involved in an accident.....especially as a "retired" driver. Do you imagine how much hay would be made by the media if there was a fatality,.......no matter who was at fault?

The insurance companies will bend heaven and earth to hang the anchor of responsibility on your neck....."Too old,...not quick enough,.....possible medical condition..."......No, Thank you.........If I go to work because I'm "bored",......or need money,.........I'll do it on private property,..In-House,....where I can only be fired, and not sued to lose my house......

Believe me,...I know what I'm talking about.........I was involved in a property-damaging accident with low wires. I was going 3 mph on a residential street 3 blocks long........We went to court,....the cable company blamed us,...the phone company blamed the cable company,....and my employer blamed both of them........


Not My Problem,........or so I thought.

2 years later,...I went to re-finance my house,....and I found out there was an $8,000 lien on my property,.......imposed by the insurance carrier,...because my employer refused to even talk with them,...citing the national low wire standards alleviated any liability for the company....

Insurance people didn't care,.........Money talks,.....and they sued everyone involved,....and as the person with his hands on the wheel,.....I was Lawsuit #1......

The company didn't even inform me that I was involved in litigation,......and the contract absolutely absolved me of any personal responsibility,...(..as long as I don't commit a felony behind the wheel..).....as I was performing my duties as an agent of the company.

I practically kicked in the TM's door and demanded an immediate resolution....I got it,....and the companies' attorneys called the bank while I was in his office.......

Now,..........Stuff like this goes on in a Union carrier,.........Imagine what goes on at a non-Union carrier, where you have NO contractual language,.......Al this does is prove to me that ....your driving skills do NOT matter,.........What matters to employers is your WILLINGNESS to take all responsibility, once you leave company property........

Drive truck when I'm retired? No thanks..........I'm not laying my head on THAT chopping block...........

Just remember it was an older, more mature, seasoned, veteran pilot who pulled off this amazing bit of flying. Don't discount the abilities and skill of older guys.
https://en.wikipedia.org/wiki/US_Airways_Flight_1549
 
But,....is a 401(K) safe? I distinctly remember a market downturn in 2001 that cost me 30% of my portfolio. And,....another one in 2008......And various small ..."fluctuations"......that cost 5% - 8%.
I can't remember any massive...jump ahead. All I ever saw was slow and steady growth,...until a precipitous and unexpected de-valuing of my account. Why no large jumps forward?

As near as I can figure,.......I could've done just as well putting my money in a bank with 1% - 2% interest over a 25 year period. No large drops in value, and the same steady growth.

A 401(K) with a company match is a good thing,....I guess. Having never have a company offer to match my 401(K) contribution,...I wouldn't know.

I don't know about your Teamster pension options,...but here in W.Pa. you can elect a "Survivor's Option",....where your wife gets your pension for as long as you live. There's a 50% survivor's, and a 100% survivor's option.

It's my understanding that....90% of your lifetime healthcare dollars,....are spent in the last 90 days of your life. In light of that,....I would think the doctors, hospitals, hospice care people,...and the funeral home directors....(...and all your creditors...)...
...would be in line in front of your spouse and family,....for any money remaining in your 401(K),...or any other savings and holdings.
 
But,....is a 401(K) safe? I distinctly remember a market downturn in 2001 that cost me 30% of my portfolio. And,....another one in 2008......And various small ..."fluctuations"......that cost 5% - 8%.
I can't remember any massive...jump ahead. All I ever saw was slow and steady growth,...until a precipitous and unexpected de-valuing of my account. Why no large jumps forward?

As near as I can figure,.......I could've done just as well putting my money in a bank with 1% - 2% interest over a 25 year period. No large drops in value, and the same steady growth.

A 401(K) with a company match is a good thing,....I guess. Having never have a company offer to match my 401(K) contribution,...I wouldn't know.

I don't know about your Teamster pension options,...but here in W.Pa. you can elect a "Survivor's Option",....where your wife gets your pension for as long as you live. There's a 50% survivor's, and a 100% survivor's option.

It's my understanding that....90% of your lifetime healthcare dollars,....are spent in the last 90 days of your life. In light of that,....I would think the doctors, hospitals, hospice care people,...and the funeral home directors....(...and all your creditors...)...
...would be in line in front of your spouse and family,....for any money remaining in your 401(K),...or any other savings and holdings.
Nothing with a good potential upside will be safe.nthe S&P has outperformed outstanding over many decades.
Remember that union pensions invest in many of the same investment vehicles with your $$$$
A survivor benefit generally results in lower payouts to the member while alive.
You need to do what is best for you.
I do not see the teamster pensions lasting another 10 years and there will be no government bail out.
Any young person hoping to collect a teamster pension in 25 years or so is bending misled....
For me, I trust my own intuition and not some pension trustee....
 
Just remember it was an older, more mature, seasoned, veteran pilot who pulled off this amazing bit of flying. Don't discount the abilities and skill of older guys.
https://en.wikipedia.org/wiki/US_Airways_Flight_1549

An amazing feat of composure and skill....

But.......what if he had impacted into the water? And people had gotten hurt or killed?

His competency would’ve been questioned.......AFTER his age and reflex level had been discussed ad infinitum in the press,...and eventually in the courtroom.......
 
Nothing with a good potential upside will be safe.nthe S&P has outperformed outstanding over many decades.
Remember that union pensions invest in many of the same investment vehicles with your $$$$
A survivor benefit generally results in lower payouts to the member while alive.
You need to do what is best for you.
I do not see the teamster pensions lasting another 10 years and there will be no government bail out.
Any young person hoping to collect a teamster pension in 25 years or so is bending misled....
For me, I trust my own intuition and not some pension trustee....

All true statements,.....
And,.....as always,...my point is: Why should your future be a “calculated” gamble?

What if there were ......inside forces......manipulating the market for their own gain?
It wouldn’t even be a “calculated “ risk........It would be a game rigged against you.

The redeeming factor for defined-benefit plans,.....is that risk is spread out over the entire pool of participants....
And......the Trustees are.....supposedly......answerable to the participants.
You don’t need the skill level of at least a day trader to make reasonably informed decisions.....

And,......if you make an “error” in your defined-contribution choices.....you suffer ......eternally.....in the most vulnerable time of your life. Your “fault”..........even in a ...rigged.....game.....

I think retirement pensions and savings are far too important to be left to blind trust,....imperfect decisions,....and potentially rigged outcomes......
Why doesn’t Congress and Wall Street see it that way, too?
 
An amazing feat of composure and skill....

But.......what if he had impacted into the water? And people had gotten hurt or killed?

His competency would’ve been questioned.......AFTER his age and reflex level had been discussed ad infinitum in the press,...and eventually in the courtroom.......

You do go through life seeing the glass as half-empty don't you?
 
All true statements,.....
And,.....as always,...my point is: Why should your future be a “calculated” gamble?

What if there were ......inside forces......manipulating the market for their own gain?
It wouldn’t even be a “calculated “ risk........It would be a game rigged against you.

The redeeming factor for defined-benefit plans,.....is that risk is spread out over the entire pool of participants....
And......the Trustees are.....supposedly......answerable to the participants.
You don’t need the skill level of at least a day trader to make reasonably informed decisions.....

And,......if you make an “error” in your defined-contribution choices.....you suffer ......eternally.....in the most vulnerable time of your life. Your “fault”..........even in a ...rigged.....game.....

I think retirement pensions and savings are far too important to be left to blind trust,....imperfect decisions,....and potentially rigged outcomes......
Why doesn’t Congress and Wall Street see it that way, too?

See my previous post (#37).
 
Great info El but I want to just focus on one point while I'm preparing my 10,000 page response to Canary about 401-K's.

Your comment about "breakpoints" in taxable income is hugely misunderstood by many people. I've heard people say many times that they refuse overtime because that might force them into a higher tax bracket. ABSOLUTELY, COMPLETELY WRONG!!!!! The higher tax rate at any "breakpoint" only applies to the next/additional dollars of additional income, not to all the income. So many people misunderstand that and think additional earnings actually cost them money because of the higher tax bracket. People should look up and understand marginal tax rates - "The marginal tax rate is the percentage of tax applied to your income for each tax bracket in which you qualify. In essence, the marginal tax rate is the percentage taken from your next dollar of taxable income above a pre-defined income threshold."

Now back to working on page 7 of my 10,000 page response to Canary...
This is explained starting at 1:25
 
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