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<blockquote data-quote="vantexan" data-source="post: 4269968" data-attributes="member: 24302"><p>You're absolutely right, don't know what I was thinking. OK, let's look at our $70k guy. On the PPA if he grossed $70k income he would get $5600, plus if his account was $100k, and that's an ever increasing amount, he'd get about $4k in interest. So $9600 or so for the year. If he was strictly 401k he'd get $5600 plus what the market did that year. And in either scenario he'd have the option of putting in up to the legal amount allowed, but the company match would be 8% or less depending on which option he chose. So yes he could do better under the new option as long as the market does well. And in a major downturn depending on his allocations and how closely he watched things he might see 25% or more of his account disappear. That would be bad if he's about to retire. This is why the traditional pension was a much better deal. A $25k annual pension is the equivalent of $500k earning 5%. A lot to accumulate on a courier's pay, and if risk adverse in your old age not easy to make 5% either.</p></blockquote><p></p>
[QUOTE="vantexan, post: 4269968, member: 24302"] You're absolutely right, don't know what I was thinking. OK, let's look at our $70k guy. On the PPA if he grossed $70k income he would get $5600, plus if his account was $100k, and that's an ever increasing amount, he'd get about $4k in interest. So $9600 or so for the year. If he was strictly 401k he'd get $5600 plus what the market did that year. And in either scenario he'd have the option of putting in up to the legal amount allowed, but the company match would be 8% or less depending on which option he chose. So yes he could do better under the new option as long as the market does well. And in a major downturn depending on his allocations and how closely he watched things he might see 25% or more of his account disappear. That would be bad if he's about to retire. This is why the traditional pension was a much better deal. A $25k annual pension is the equivalent of $500k earning 5%. A lot to accumulate on a courier's pay, and if risk adverse in your old age not easy to make 5% either. [/QUOTE]
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