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UPS subsidizing non ups pensions
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<blockquote data-quote="JonFrum" data-source="post: 131727"><p>I'm reading reports that the UPS mechanic's pension plan is offering them a monthly retirement of $10,000 or so, which makes the Teamsters' monthly retirement checks look very poor in comparison. The UPS mechanics are Teamsters in some areas of the country, and IAM members elsewhere. Those who are members of the International Association of Machinists and Aerospace Workers (IAM) have their own nationwide pension plan called The IAM National Pension Plan. It's true the IAM plan (overfunded at 124% !!!) is better than say the Central States or New England plans ( underfunded at 58% and 57%), but it's not as good as the $10,000 figure would suggest. First, IAM members seem to contribute more per hour into their fund so obviously one would expect a higher benefit on that basis alone. This may vary from Lodge to Lodge. (We have Locals, they have Lodges, go figure.) </p><p></p><p>Note how the contribution rate table goes up to $10 per hour, and how IAM members' benefit accruals are higher for the same contribution rate than ours. </p><p></p><p>The fund appears to be doing well but read the Summary of Material Modifications . . .</p><p><a href="https://web.archive.org/web/20050316111645/http://www.iamnpf.org/npf/forms/smm_2003.pdf" target="_blank">https://web.archive.org/web/20050316111645/http://www.iamnpf.org/npf/forms/smm_2003.pdf</a></p><p></p><p>to learn the bad news. This 8-page document reveals that the plan has been recently amended: </p><p>1.) No longer will Past Service Credit be granted. </p><p>2.) Future employers and their employees who join the plan after April 1, 2003 will only get 60% of the retirement amounts that current (grandfarthered) employee groups get!!! That's a 40% cut, and it also applies to any present member who goes to work in the future for one of the new employers.</p><p></p><p>Also, note that the $10,000 figure is a projection based on the assumption that the member will continue to work as an Active and have contributions made on his behalf into the fund until he is age 62, or age 65. Thus, someone with, say, 15 or 20 or 25 years currently, who was once a 17- or 21-year-old New Hire, is assumed to continue working until 62 or even 65, for a career lasting up to 48 years. Naturally, any pension fund could promise you a huge pension if you are willing to work that long. But few people are. And even if you are, UPS may well get the better of you before you reach the finish line. You don't see many UPSers in their 60's now do you?</p><p></p><p>It's a good sign that people are at least comparing apples to apples when they compare the various Teamsters plans to the IAM plan. (Of course, they always pick the worst of the Teamsters plans to use in the comparison.) At least the Teamsters plan is being compared to a plan that actually exists, with an actual track record, and an actual website with lots of information. But even so, be careful comparing the individual annual statements of a Teamsters plan member to an IAM plan member. My personal statement tells me what I'll get at age 64 if I quit work today, or get pushed out, and wait as an Inactive until 64, when I start to collect. (I could retire as early as age 55, but the age 64 amount would be reduced proportionatly.) The IAM personal statement Projected Benefit Amount assumes a comparable person will continue as an Active right up to the bitter end -- age 62 or 65 -- with all those additional years of additional plan contributions and investment returns adding to the final benefit amount. If you instead look elsewhere on the IAM statement, you will see that the benefit amount promised to an IAM plan member who quits work today and waits as an Inactive until 65, (or takes a reduced Early Retirement) is somewhat larger than the Teamster amount but nowhere near $10,000. My current 25 years of Pension Credit will get me about $3,700 at age 64; an IAM mechanic's statement I saw, with 20 years service would get about $3,900 at age 65. The IAM plan has an Unreduced Pension at age 62 if you have 20 years service. Another plus for the IAM.</p><p></p><p>Then there's the Local 804 I.B.T. and Local 447 IAM UPS Multi-employer Retirement Plan which is smaller and underfunded at 59% according to Moody's 16 page analysis of major pension plans. . .</p></blockquote><p></p>
[QUOTE="JonFrum, post: 131727"] I'm reading reports that the UPS mechanic's pension plan is offering them a monthly retirement of $10,000 or so, which makes the Teamsters' monthly retirement checks look very poor in comparison. The UPS mechanics are Teamsters in some areas of the country, and IAM members elsewhere. Those who are members of the International Association of Machinists and Aerospace Workers (IAM) have their own nationwide pension plan called The IAM National Pension Plan. It's true the IAM plan (overfunded at 124% !!!) is better than say the Central States or New England plans ( underfunded at 58% and 57%), but it's not as good as the $10,000 figure would suggest. First, IAM members seem to contribute more per hour into their fund so obviously one would expect a higher benefit on that basis alone. This may vary from Lodge to Lodge. (We have Locals, they have Lodges, go figure.) Note how the contribution rate table goes up to $10 per hour, and how IAM members' benefit accruals are higher for the same contribution rate than ours. The fund appears to be doing well but read the Summary of Material Modifications . . . [url]https://web.archive.org/web/20050316111645/http://www.iamnpf.org/npf/forms/smm_2003.pdf[/url] to learn the bad news. This 8-page document reveals that the plan has been recently amended: 1.) No longer will Past Service Credit be granted. 2.) Future employers and their employees who join the plan after April 1, 2003 will only get 60% of the retirement amounts that current (grandfarthered) employee groups get!!! That's a 40% cut, and it also applies to any present member who goes to work in the future for one of the new employers. Also, note that the $10,000 figure is a projection based on the assumption that the member will continue to work as an Active and have contributions made on his behalf into the fund until he is age 62, or age 65. Thus, someone with, say, 15 or 20 or 25 years currently, who was once a 17- or 21-year-old New Hire, is assumed to continue working until 62 or even 65, for a career lasting up to 48 years. Naturally, any pension fund could promise you a huge pension if you are willing to work that long. But few people are. And even if you are, UPS may well get the better of you before you reach the finish line. You don't see many UPSers in their 60's now do you? It's a good sign that people are at least comparing apples to apples when they compare the various Teamsters plans to the IAM plan. (Of course, they always pick the worst of the Teamsters plans to use in the comparison.) At least the Teamsters plan is being compared to a plan that actually exists, with an actual track record, and an actual website with lots of information. But even so, be careful comparing the individual annual statements of a Teamsters plan member to an IAM plan member. My personal statement tells me what I'll get at age 64 if I quit work today, or get pushed out, and wait as an Inactive until 64, when I start to collect. (I could retire as early as age 55, but the age 64 amount would be reduced proportionatly.) The IAM personal statement Projected Benefit Amount assumes a comparable person will continue as an Active right up to the bitter end -- age 62 or 65 -- with all those additional years of additional plan contributions and investment returns adding to the final benefit amount. If you instead look elsewhere on the IAM statement, you will see that the benefit amount promised to an IAM plan member who quits work today and waits as an Inactive until 65, (or takes a reduced Early Retirement) is somewhat larger than the Teamster amount but nowhere near $10,000. My current 25 years of Pension Credit will get me about $3,700 at age 64; an IAM mechanic's statement I saw, with 20 years service would get about $3,900 at age 65. The IAM plan has an Unreduced Pension at age 62 if you have 20 years service. Another plus for the IAM. Then there's the Local 804 I.B.T. and Local 447 IAM UPS Multi-employer Retirement Plan which is smaller and underfunded at 59% according to Moody's 16 page analysis of major pension plans. . . [/QUOTE]
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