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Pension fix
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<blockquote data-quote="Inthegame" data-source="post: 3972358" data-attributes="member: 37112"><p>I almost TLDR'd my own post. Here's the Readers Digest version.</p><p></p><p>Tier 1: reduces monthly benefit to 110% of PBGC guarantee.</p><p>PBGC guarantee is 30% of normal benefit received (with some exceptions for age and disability) </p><p>Fred Freight receives $1500 per month. CSPF Rescue Plan gets approved, Fred's benefit gets reduced to $1500 X 30% = $450 X 110% = <strong>$495</strong> </p><p>Fred loses 67% of his benefit.</p><p></p><p>Tier 2: reduces those with less than 20 yrs contributory service by 50%.</p><p>Bob Baker retired with 19yrs of service and qualifies for a $1900 monthly benefit. CSPF Rescue Plan is approved. Bob now gets <strong>$950</strong>, a 50% reduction.</p><p></p><p>Tier 3: (UPS employees) reduces those with more than 20 yrs of contributory service by 40%.</p><p>1) Billy Box retired in early 2007 with 30yrs of service and qualifies for a $3000 monthly benefit. CSPF Rescue Plan is approved. Billy's benefit gets reduced by 40% or $1200. Billy now gets <strong>$1800.</strong></p><p>2) Paul Package retired in 2008 with 30 yrs and qualifies for a $3000 monthly benefit. Paul also gets reduced by 40% but qualifies for the 2007 NMA contractual offset. CSPF pays Paul <strong>$1800</strong> monthly, UPS pays Paul <strong>$1200</strong> monthly. </p><p></p><p>While the monthly dollar reduction is greater in the Tier 3 (1) example than in either 1 or 2, the pct of reduction is greater for the Tier 1 and 2 parties. Had Tier 1 started at the same monthly benefit as the other examples, that dollar reduction would have been greater.</p></blockquote><p></p>
[QUOTE="Inthegame, post: 3972358, member: 37112"] I almost TLDR'd my own post. Here's the Readers Digest version. Tier 1: reduces monthly benefit to 110% of PBGC guarantee. PBGC guarantee is 30% of normal benefit received (with some exceptions for age and disability) Fred Freight receives $1500 per month. CSPF Rescue Plan gets approved, Fred's benefit gets reduced to $1500 X 30% = $450 X 110% = [B]$495[/B] Fred loses 67% of his benefit. Tier 2: reduces those with less than 20 yrs contributory service by 50%. Bob Baker retired with 19yrs of service and qualifies for a $1900 monthly benefit. CSPF Rescue Plan is approved. Bob now gets [B]$950[/B], a 50% reduction. Tier 3: (UPS employees) reduces those with more than 20 yrs of contributory service by 40%. 1) Billy Box retired in early 2007 with 30yrs of service and qualifies for a $3000 monthly benefit. CSPF Rescue Plan is approved. Billy's benefit gets reduced by 40% or $1200. Billy now gets [B]$1800.[/B] 2) Paul Package retired in 2008 with 30 yrs and qualifies for a $3000 monthly benefit. Paul also gets reduced by 40% but qualifies for the 2007 NMA contractual offset. CSPF pays Paul [B]$1800[/B] monthly, UPS pays Paul [B]$1200[/B] monthly. While the monthly dollar reduction is greater in the Tier 3 (1) example than in either 1 or 2, the pct of reduction is greater for the Tier 1 and 2 parties. Had Tier 1 started at the same monthly benefit as the other examples, that dollar reduction would have been greater. [/QUOTE]
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