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Pension fix
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<blockquote data-quote="Inthegame" data-source="post: 3971056" data-attributes="member: 37112"><p>So far so good...</p><p> You're describing a "new" plan, not the mature plans we are all under. When the plan I'm in first started (in the 1950's), contributions were made from participating employers for a year before any benefits were paid. The max monthly retiree benefit (unreduced age 65) was a multiple of each employees' employer contributions with interest added. Less than 3% of participants "retired" in the first three years, thereby allowing the plan to have more funds <strong>available for investment</strong> than benefit payment. That pooled <strong>investment income</strong>, not continuing contributions allowed the plan to fulfill it's obligations and make good on the promised benefit payments. </p><p></p><p>That's how sustainable pensions succeed, and why ponzi's never do.</p><p>Correct in some plans. Coal miners probably not, but as life expectancy increases, months of benefit payments increase. Mature plans account for these conditions in the actuarial determinations for pct of plan funding levels. </p><p>UPS employees were in the <strong>least</strong> cut tier in the last "Rescue Plan" submitted by CSPF to the treasury dept. that was rejected as not cutting enough.</p><p>Obviously UPS accountants that consulted with UPS negotiators regarding the "shortfall make-up" language weren't expecting the '08 meltdown as the withdrawal liability payment put the CSPF in + 80% funding, thereby not requiring consideration for any cuts.</p><p>Maybe they needed a clairvoyant brownIEman on that group to keep them from getting "boned" by following a contractual promise.</p></blockquote><p></p>
[QUOTE="Inthegame, post: 3971056, member: 37112"] So far so good... You're describing a "new" plan, not the mature plans we are all under. When the plan I'm in first started (in the 1950's), contributions were made from participating employers for a year before any benefits were paid. The max monthly retiree benefit (unreduced age 65) was a multiple of each employees' employer contributions with interest added. Less than 3% of participants "retired" in the first three years, thereby allowing the plan to have more funds [B]available for investment[/B] than benefit payment. That pooled [B]investment income[/B], not continuing contributions allowed the plan to fulfill it's obligations and make good on the promised benefit payments. That's how sustainable pensions succeed, and why ponzi's never do. Correct in some plans. Coal miners probably not, but as life expectancy increases, months of benefit payments increase. Mature plans account for these conditions in the actuarial determinations for pct of plan funding levels. UPS employees were in the [B]least[/B] cut tier in the last "Rescue Plan" submitted by CSPF to the treasury dept. that was rejected as not cutting enough. Obviously UPS accountants that consulted with UPS negotiators regarding the "shortfall make-up" language weren't expecting the '08 meltdown as the withdrawal liability payment put the CSPF in + 80% funding, thereby not requiring consideration for any cuts. Maybe they needed a clairvoyant brownIEman on that group to keep them from getting "boned" by following a contractual promise. [/QUOTE]
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