401K Speculation

Discussion in 'UPS Discussions' started by upandcomer, Dec 28, 2009.

  1. upandcomer

    upandcomer New Member

    I was re-organizing my 401k this evening and I saw..."Pending Stock Fund" under Fund Prices. Wonder if this could possibly have something to do with re-instating our 401k match?!?!

    See the attached image.
  2. AirTechSpec

    AirTechSpec New Member

    I think this is just another option to invest in that they haven't fully defined yet. They've been playing with the options for a while now to adapt to the "challenging times". :wink2:
  3. spif91

    spif91 Member

    When did they ever match our 401K?????? Management???
    Never have here......
  4. raceanoncr

    raceanoncr Well-Known Member

    Good luck! FredEx already has brought back some match. Never has been match for f/t union, thank goodness! If you want it, you're non-union? Knock yerself out! I wouldn't take it if they offered it!
  5. upandcomer

    upandcomer New Member

    Wow, you wouldn't take free money?

    All non-union personal born after 1978 only get a 401k and no pension. This would be okay if you were getting your dollar for dollar match up to 3.5%. The advantage being I can take my 401k to any company, where with an pension you are virtually stuck at the job you have.
  6. raceanoncr

    raceanoncr Well-Known Member

    No, I DON'T want "free" money!

    That "free" money is gonna cost you later. How? Well, say YOU put in 6% yourself. UPS matches that at another 6%. OK. UPS gets to take the tax break for their 6% right now, this year. YOU only get your 6% knocked off your taxable earnings right now, this year. Copy? Easy. You now have 12% in your 401, right?

    You keep doing that for years and years and years until you got a sizable chunck in your 401. BUT, you've let them match it every year.

    Comes time to start taking it out, YOU are going to have to pay taxes on the 6% YOU put in AND the 6% UPS put in (plus, of course, whatever other earnings it made). Copy? You wanna do that? Pay taxes on something that you didn't even touch or earn? Oh, sure, you and others will say, "Well, I DID earn that match!" Well, think of it that way if you want, I don't.

    Something else. I max mine out each year. Right now, I'm taking 18% and that about maxes me out at end of year. What is it now? 16,000? Don't quite know. Will look. I get to zip that complete 16,000 right off the top of my earnings so it ain't taxed. Can you do that if someone is matching your 401? Maybe someone else can answer that. It seems to me that if you're only putting in, say, 6% and the rest is being matched, you can only zip off your 6% off the top of your earnings to be taxed, correct?

    Anyway, I want to be in complete control of any or all investments I have. I don't want to be reliant on UPS or any other company to match something, only to take it away and then to tease me by restoring some of it back then possibly taking it away again.
  7. ups79

    ups79 Active Member

    So you have something against making 100% on your investment immediately when you invest?
  8. Hawk780

    Hawk780 No One in Particular

    That was one of the funniest posts I've ever seen on Brown Cafe... Copy?
  9. tireknocker

    tireknocker Member

    What we really need is a new Roth 401K. Pay taxes up front, thats the way to go!
  10. nervIS

    nervIS New Member

    we have that. management that is. i don't know about the unions.

    you could always do self-directed and pick better funds and stocks on your own. once again, management that is.
  11. brownmonster

    brownmonster Man of Great Wisdom

  12. purplesky

    purplesky Active Member

    Most UPS union folks will not be making $85000 when they retire so a Roth isnt that great of a deal. Most retired union UPSERS will be in a lower tax bracket so you are better off maxing out at $16500 to beat the OT tax game. A Roth is a better tool if you plan on being in a higher tax bracket when you retire. Now if you want to leave alot of cash to your kids than a Roth is great for them because they get it tax free. It would be nice to have it offered though in our 401K. But for some reason it has been slow to catch on at most companies.
  13. tireknocker

    tireknocker Member

    In the Union 401k we can only put 5% in after tax. Why not offer 10-15% maybe some kind of law. Since this money has been taxed you can pull it out any time no penalty. Just have to add to your gross income.
  14. UpstateNYUPSer

    UpstateNYUPSer Very proud grandfather.

    Why not just put the 5% after tax in to your 401k and then open up a Roth for the remainder?
  15. raceanoncr

    raceanoncr Well-Known Member

    Geez, I knew somebody was gonna jump in this all starry-eyed. If you want to think that way, just go right ahead. I'm merely expressing MY opinion, which I'm an expert on.

    First, consider some loose facts.

    Most UPSers aren't even in the 401. What is it, about 20-22%? Somebody can and WILL correct this figure, I know.

    Most people, not just UPSers, will not deduct more than their match. What? Everybody I know from ANY company that had a match, whatever it was, 3,6,7%, would only deduct exactly what that match was. If their company would match 3%, they would only take out 3% themselves, for example, leaving alot more to be taken out, if only they would have. Why? "I can't afford it!" What's this got to do with anything?

    I think most, MOST, people are pretty narrow-minded when it comes to 401. Look at all the people that "lost" their 401 this last year. How? I didn't touch mine, just kept adding to it and the news said last week that most were probably back to pre-2008 levels. Did I lose? Hmmm...if I would've had to take it OUT I would have. Or if I got scared and moved it I would have, but, no, I didn't lose. Oh, YOU will say so because I could have had more in by now if it weren't for the big crash. But I don't view it that way.

    Now, you say it's a 100% return on my investment if I get a match. What about the amount that I have to pay tax on NOW because I take a match? What if (rounding out) we max out at 16,000 but I only put in 8,000 and company matched 8,000? I lost out on tax-off-the-top of 8,000 I COULD have had if I'd been able to put the whole 16,000 in. In other words, I have to pay tax on an additional 8,000 of my money now, and pay tax on an additional 8,000 of their money when I take it out (sure, it will probably be in a lower tax bracket then).

    MY view, again, MY VIEW, is that I'm being penalized if I take a match now. I'm in a 33-35% tax bracket and I want all the breaks I can get NOW and not be stifled. Later, when retired, I may be in a 15% bracket so then taxes will be a little easier to handle.

    You wanna be nit-picky? Why not comment on what I also said about being in control of my investments. Like how companies, yes, UPS too, have a propensity of taking things away that aren't contractually binding. Like 401s for non-union people, FredEx for example. I just don't want that uncertainty. Some UPSF guys here, HERE, thought they were really skunked when they took away their match. It was almost a deal-breaker for them.

    Well, I could go on and on, like how I don't want companies getting the tax breaks when I could be, how I don't want the gooberment playing with my money (anymore than they already do) when I want to be the one playing with it, and so on and so on but you don't want to hear it.

    Go on and keep thinking that way if you want. Your way is completely fine and legal, but for ME? Uh, uh!
  16. upandcomer

    upandcomer New Member

    You either have to be the dumbest person on the planet or this is a complete giant level.

    Really! Honestly! Mods that was the nicest way I could put it!

    Lets do some math.

    Your scenario:

    Company - $0
    You - $16,000

    Taxes - $0

    Investing for your future retirement - $16,000

    Future - Doubles every 7 years. 35 years has doubled 5 times to $512,000.

    End with $512,000

    Rest of all humanity and all intelligent peoples scenario:

    Company - $8000
    You 401k - $8000
    You None 401k Retirement Savings - $8000

    Taxes (Lets use your 35% figure) - 8,000 * 35% = $2800

    Investment for future retirement - 8,000+8,000+8,000-2,800 = $21,200

    Future - Doubles every 7 years. 35 years has doubled 5 times to $678,400.

    So your unwillingness to not pay $2800 in taxes up front because you refuse to take the company match has cost you....

    $166,400- $2800 (taxes) = $163,600

  17. 1989

    1989 Well-Known Member

    Very optimistic of you assuming that you will earn 10.29% every year.
  18. raceanoncr

    raceanoncr Well-Known Member

    Yeah, you're right. I AM the dumbest person on the face of the earth.

    Let's see...by your calculations, the company contributes X amount, no, wait, they take that away. OK, they say they're gonna contribute X amount again, no, wait, they take that away. Well, we made a mistake, we're gonna give you, no, wait...

    Show me where they have "doubles every 7 years" or "35 years have doubled to..."

    Yeah, I trust them to handle my future. I AM the dumbest person on the face of the earth.

    Congratulations to me.
  19. 1989

    1989 Well-Known Member

    Rule of 72 says...

    72 divided by your interest rate tells you how many years your money will double. In this case they are assuming you will make over 10% a year for 35 years.
  20. brownmonster

    brownmonster Man of Great Wisdom

    The last 10 years killed that theory.