UpstateNYUPSer(Ret)
Well-Known Member
He is an active employee.
UPS Special Pension Buyout Offer - December 2016
- Thread starter JMR07168
- Start date
He is an active employee.
freeloader
geek
I too received one of these post cards. I'm a former employee, 11 years PT union / 7 years FT admin. Very curious to see how this all unfolds. As Ms PacMan says, there will be potentially serious tax implications by accepting the lump sum. And it will also most likely not be the full value, it will be calculated at "present value" of the "full value" which is a very different (and less) amount. Find a CPA or Financial Advisor to help you make the proper decision for your situation.
freeloader
geek
BTW unless I find a very compelling reason to cash out, I plan to NOT cash out and leave my pension as is.
soxare1
New Member
I received the same postcard last week as well and have a similar vested amount and age.
From talking to my accountant, one of the options you have when you take a lump sum pension distribution is to spread the tax liability over 10 years. For example, if you were distributed $100K, you don't have to pay the full tax all in the year it was distributed, you would file $10K in tax liability for year 1, $10K in tax liability in year 2, etc. This could make a big difference of the overall tax liability so you aren't bumped up into the next tax bracket. Another advantage is thatlump sum pension distributions are not subject to state tax or social security and only subject to federal withholdings.
With all that said, looking forward to what they come back with.
Jaco Williams
Active Member
I got the same card the other day... I worked on the airline side for 15yrs in aircraft maintenance, non-management, non-union....
I'm curious to see what it is. I plan to take the money and run. Simple as that...
I'm curious to see what it is. I plan to take the money and run. Simple as that...
UpstateNYUPSer(Ret)
Well-Known Member
Think J.G. Wentworth.
UpstateNYUPSer(Ret)
Well-Known Member
Did your accountant say if rolling this over to a retirement account was an option?
ColtLester45
Member
I received a postcard too... I'm a former UPSer, worked in the hub 2 years and was a PT Air Driver for 7.5, after a total of 9.5 years, my pension allows me to draw $465 a month starting at age 65. When I left UPS about 4 years ago (had gone back to college, found a better job), I didn't even know I had qualified for this pension. I never contributed to my 401k since it was just a part time job, so since I started my current job, I've been very aggressive in adding to my 401k with the current company. I'm curious to think of what kind of money we are talking about here. Its going to take a pretty good lump sum for me to let go of a pension, but for the right amount, I have some student loans I'd really like to pay off. I don't know if they're going to offer us $5 or $50,000. I would think if UPS was trying to get people to take the offer to help their cashflow issues, that they'd have to offer enough for people like us to seriously consider it.
kevin durant
New Member
at 465 i wouldnt expect more than 10k
freeloader
geek
I haven't spoken to an accountant yet, but I would think that rollover options would definitely be one of the wiser choices in order to avoid the tax hit. Take the money and run (as some have said), not a very wise choice IMO, for a couple of reasons: there will be a huge increase in taxable income in a single year, and you just cashed out a significant part of what would have probably been a major source of income in retirement. Once October rolls around I'm sure all of our options will be presented to us.
Choose wisely.
freeloader
geek
BTW does anyone know if this is both the union pension fund and the non-union pension fund? I worked on both sides of the fence and am vested in both.
UpstateNYUPSer(Ret)
Well-Known Member
It is the company plan.
freeloader
geek
pondering... wonder if the union plans to do this as well at some point?
brownmonster
Man of Great Wisdom
If this is good for the company then chances are it's not good for the employee.
Jaco Williams
Active Member
I was in the "grandfathered" pension plan.... 15yrs vested or whatever... According to the math (if I did it correctly) in the UPS Retirement Plan (2007 is latest revision), I will be getting approx. $1450 a month at 65 until I kick the bucket. I found a spreadsheet on line (looking for the link now, I can't remember/find it dang it..!!) that calculates what your pension value will be like if you take the lump sum option. My lump sum is looking like $80k-$120k. Depends on if UPS calculates my retirement at 55 or 65yrs old.... Either way - Imma gonna take it..!!!
trickpony1
Well-Known Member
Don't be too quick to accept the offer.
Read post #36 and you'll understand why.
Read post #36 and you'll understand why.
JMR07168
Member
Maybe, but its possible to use a lump sum to generate money that far exceeds what any pension payout would be after 65. Real estate is an example.
It will be case by case. Im interested to see what they offer. Ill let you guys know what it is and what I decide.
I didn't even know I was vested until a couple years ago. I wasn't expecting this or planning on it.
I do know that if Im that worried about a few hundred bucks a month by the time I get to 65 I will have made a LOT of mistakes between now and then.
freeloader
geek
In the case of real estate, you would most likely have to pay tax and penalties if there are any, on the lump sum, which could be significant.
If you take the lump sum and roll it into an IRA or 401k, then you would not have to pay any tax or penalties, but you would be free to make investment choices within your IRA or 401k.
In either case it's a gamble, you may or may not out-perform what it would have done if you left it alone.
If you take the lump sum and roll it into an IRA or 401k, then you would not have to pay any tax or penalties, but you would be free to make investment choices within your IRA or 401k.
In either case it's a gamble, you may or may not out-perform what it would have done if you left it alone.
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