New Development with Response?

[El Morado Diablo]

I just looked at my info from the 401k/PPA switch. I'm currently getting a combined 9.5% from the company (3.5% match in the 401k and 6% in the PPA). Some of the older couriers are getting as much as 11.5% from the company due to age + years of service.

The PPA compensation credits and transition compensation credits are 8% + 5% = 13% for employees whose age + years of credited service is 75+. I think you had to be at least 40 years old at the time to qualify for the transition credits when they dropped the traditional pension.

 

[MassWineGuy]

I started in 2014. What type of pension was in place then?

 

[MAKAVELI]

The PPA compensation credits and transition compensation credits are 8% + 5% = 13% for employees whose age + years of credited service is 75+. I think you had to be at least 40 years old at the time to qualify for the transition credits when they dropped the traditional pension.

The 11.5% is the current PPA max credits + the max 3.5% 401k match.

 

[MAKAVELI]

I started in 2014. What type of pension was in place then?

PPA + 401k

 

[El Morado Diablo]

The 11.5% is the current PPA max credits + the max 3.5% 401k match.

My bad, I was looking at the formula charts on how they figured PPA credits. I no longer qualify for the transition credits so I only get the compensation credit (8%).

"You were eligible to receive a transition compensation credit for five years (through May 31, 2013) or until you have 25 years of credited service for benefit accrual, whichever is longer. For years of credited service over 25 years, transition credits are 2 percent per year through May 31, 2013."

 

[MassWineGuy]

How does the PPA work? How are weekly contributions calculated?

 

[McFeely]

How does the PPA work? How are weekly contributions calculated?

I believe the PPA gets quarterly contributions from the company, not weekly. It also grows at a steady percentage, and not based on stock/fund performance.

 

[MassWineGuy]

Sounds like keeping it was the right thing.

 

[McFeely]

I believe the PPA gets quarterly contributions from the company, not weekly. It also grows at a steady percentage, and not based on stock/fund performance.

I may have misspoken on the quarterly contribution part.

I think the company does their contribution 1x a year based on previous 12 months' pay around May 31. The quarterly part is the 1% interest gain that is applied every 3 months (Aug 31, Nov 30, Feb 28, May 31) for a total of around 4% steady/continuous gain.

Sorry for the misinfo. Someone please correct me if I'm missing anything. I'm having beers and memory is getting fuzzzzzzzzy.

 

[MassWineGuy]

The interest rate on the pension increases one point every three months? No wonder they don’t like it.

So let’s say that for six or eight months of one year I worked like a dog with as many hours and as much OT as possible. That would boost the pension a lot that year. I don’t think I plan to do this. Just wondering.

 

[McFeely]

I wouldn’t get your hopes up too high that the PPA will grow at a fast rate, regardless of hours worked. I am FT and my PPA typically is only about $4k bigger each year after the company contributions and the 4% gains.

Contrast that with my 401k…I’ve had that gain $140k in 12 months (I’m cherry picking March 2020-March 2021 just to make a point, but still). I’ve also lost a metric crapload in my 401k in the last 12 months.

Obviously it all depends on your risk tolerance and time to retirement, etc.