Home
Forums
New posts
Search forums
What's new
New posts
Latest activity
Members
Current visitors
Log in
Register
What's new
Search
Search
Search titles only
By:
New posts
Search forums
Menu
Log in
Register
Install the app
Install
Home
Forums
Brown Cafe UPS Forum
UPS Retirement Topics
Dreaded Pension Funding Level Letter
JavaScript is disabled. For a better experience, please enable JavaScript in your browser before proceeding.
You are using an out of date browser. It may not display this or other websites correctly.
You should upgrade or use an
alternative browser
.
Reply to thread
Message
<blockquote data-quote="JonFrum" data-source="post: 733110" data-attributes="member: 18044"><p>Central States has been hurt by the same market downturns as all other funds, but it is in worse shape than most. This is mostly because Central States has a huge pool of retirees drawing benefits relative to a smaller pool of actively working contributing participants. Made worse by UPS withdrawing 44,000 active participants.</p><p> </p><p>The Central States retirees probably contributed suficient funds during their working years to fund their own retirement in full. Unfortunately, the stock market has sunk several times since and so the assets to pay retirees are no longer all there. This shortfall must be made up by skimming money from the contributions of participants who are still working. So current members earn relatively less future pension benefits for their relatively high contributions.</p><p> </p><p>Bad luck in investing also played a part. Any fund that was heavily invested in stocks when stocks dropped was hit harder than a fund who's portfolio wasn't so heavily weighted with stocks at those times.</p><p> </p><p>UPS paid $6.1 billion in a Withdrawal Liability payment to Central States, which didn't get any UPSer any additional benefits at all. Had they made comparable payments in the form of contributions, imagine what pension increases such a sum could have bought.</p><p> </p><p>UPS paid $1.7 billion just to initially fund their new pension plan's feature that restored UPSers right to collect benefits before age 65. If that money had been given to Central States instead, Central States could have restored UPSers right to collect benefits before age 65.</p><p> </p><p>From Central States point of view UPS chose to make a bad situation worse.</p></blockquote><p></p>
[QUOTE="JonFrum, post: 733110, member: 18044"] Central States has been hurt by the same market downturns as all other funds, but it is in worse shape than most. This is mostly because Central States has a huge pool of retirees drawing benefits relative to a smaller pool of actively working contributing participants. Made worse by UPS withdrawing 44,000 active participants. The Central States retirees probably contributed suficient funds during their working years to fund their own retirement in full. Unfortunately, the stock market has sunk several times since and so the assets to pay retirees are no longer all there. This shortfall must be made up by skimming money from the contributions of participants who are still working. So current members earn relatively less future pension benefits for their relatively high contributions. Bad luck in investing also played a part. Any fund that was heavily invested in stocks when stocks dropped was hit harder than a fund who's portfolio wasn't so heavily weighted with stocks at those times. UPS paid $6.1 billion in a Withdrawal Liability payment to Central States, which didn't get any UPSer any additional benefits at all. Had they made comparable payments in the form of contributions, imagine what pension increases such a sum could have bought. UPS paid $1.7 billion just to initially fund their new pension plan's feature that restored UPSers right to collect benefits before age 65. If that money had been given to Central States instead, Central States could have restored UPSers right to collect benefits before age 65. From Central States point of view UPS chose to make a bad situation worse. [/QUOTE]
Insert quotes…
Verification
Post reply
Home
Forums
Brown Cafe UPS Forum
UPS Retirement Topics
Dreaded Pension Funding Level Letter
Top