AGE 60 passes Senate today..

[jke406]

B fund consequences?

question for someone with more knowledge than I:

I was under the impression that the "B" fund existed as a means of compensating pilots for not being able to work all the way to retirement age (65), i.e., the B fund payments over a career would make up for five years' less income with mandatory retirement at age 60.

is that the case, and if so, now what?

 

[PCL_128]

If you don't upgrade earlier (which you will, due to increased retirements between age 60-65-medical, etc.), you will gain 5 years of FO pay, which is worth a lot, relative to worlwide incomes, and may be worth a lot, period, such as if you're at a major and you're making $50-$100+ per year as an FO.

That's not a gain, that's a loss. Run the numbers and figure out how much you'll have lost in career earnings due to the loss of compound interest if you choose to retire at the reasonable age of 60. For most pilots, the number is between $250-$500k.

And if you think that $50-$100k per year is a lot of money, then you've been drinking from the pilotyip kool aid pitcher for far too long.

 

[DiamondZ]

you will gain 5 years of FO pay, which is worth a lot, relative to worlwide incomes

Yippee!!! I make more than a McDeez burger flipper.

 

[m80drvr]

Hi!

If you don't upgrade earlier (which you will, due to increased retirements between age 60-65-medical, etc.), you will gain 5 years of FO pay, which is worth a lot, relative to worlwide incomes, and may be worth a lot, period, such as if you're at a major and you're making $50-$100+ per year as an FO.

C U!

cliff
GRB

PS-I think it's wrong they made an age limit. They should've done away with a limit alltogether.

You, my friend, are an IDIOT!

 

[PCL_128]

question for someone with more knowledge than I:

I was under the impression that the "B" fund existed as a means of compensating pilots for not being able to work all the way to retirement age (65), i.e., the B fund payments over a career would make up for five years' less income with mandatory retirement at age 60.

is that the case, and if so, now what?

A B-Fund is just a type of pension plan. An A-Fund is the tradition pension that people think of, in that it's a defined benefit plan that provides a fixed amount of income per year after retirement. A B-Fun is a defined contribution plan. In other words, the company merely provides a set amount of money towards your own account that will accrue interest until you retire and start withdrawing. I you have to wait an additional five years until breaking the six-figure mark and still retire at the same age, then you've lost lots of compound interest in your B-Fund over that time.

 

[Beetle007]

People like to look at how much you can save for retirement and use fancy numbers for compounding and interest rates. People say if you save X amount of dollars a year you will have 1 million (or whatever) amount of money when you retire. Yeah.... But 1 million dollars in 35 years isn't going to go to far. Maybe I will be able to buy a car.

How much money do you think a captain will be making in 35 years? Maybe 500K -700K+ a year in future dollars. If they are still making 100-200K in 35 years then all of us young guys are in for a world of hurt.

The reality is, your money might barely keep up with inflation and devaluation. Housing, Healthcare, Gas, and most energy costs have doubled or trippled in the past 5 years. So, if your investments doubled or trippled in the past 5 years, you are just braking even. Try picking up a copy of the 401K hoax (book) and you will realize why trying to save for retirement by the age of 60 is almost impossible at average wages and without a pension or social security.

I would rather have the 5 extra years of pay than a few extra dollars from upgrading earlier etc. In reality, age 65 will probably effect your upgrade or career advancement by 2-3 years, and you will have 5 years of extra earnings at future pay rates (which will be higher than todays due to inflation and devaluation of the dollar).

 

[jtm2222]

F**k all you bastards who want to fly till your 65

 

[PuffDriver]

People like to look at how much you can save for retirement and use fancy numbers for compounding and interest rates. People say if you save X amount of dollars a year you will have 1 million (or whatever) amount of money when you retire. Yeah.... But 1 million dollars in 35 years isn't going to go to far. Maybe I will be able to buy a car.

How much money do you think a captain will be making in 35 years? Maybe 500K -700K+ a year in future dollars. If they are still making 100-200K in 35 years then all of us young guys are in for a world of hurt.

The reality is, your money might barely keep up with inflation and devaluation. Housing, Healthcare, Gas, and most energy costs have doubled or trippled in the past 5 years. So, if your investments doubled or trippled in the past 5 years, you are just braking even. Try picking up a copy of the 401K hoax (book) and you will realize why trying to save for retirement by the age of 60 is almost impossible at average wages and without a pension or social security.

I would rather have the 5 extra years of pay than a few extra dollars from upgrading earlier etc. In reality, age 65 will probably effect your upgrade or career advancement by 2-3 years, and you will have 5 years of extra earnings at future pay rates (which will be higher than todays due to inflation and devaluation of the dollar).

then you ain't good enough at math.

40 years old xtra 30K per year from upgrade--for 5 years= 219K, and that's at only 6%. Then take that and go for another 15--age 60=1,265,995 at same 6%. There's nothing fancy about it. That is reality. 5 years cost this guy 1,000,000--very conservatively. Throw in another 10K raise and 2% per year and it is very close to 2,000,000.

Sorry, you don't get to assume 500K 20 years from now.

A bad deal for under 60 pilots any way you slice it

 

[PCL_128]

People like to look at how much you can save for retirement and use fancy numbers for compounding and interest rates. People say if you save X amount of dollars a year you will have 1 million (or whatever) amount of money when you retire. Yeah.... But 1 million dollars in 35 years isn't going to go to far. Maybe I will be able to buy a car.

How much money do you think a captain will be making in 35 years? Maybe 500K -700K+ a year in future dollars. If they are still making 100-200K in 35 years then all of us young guys are in for a world of hurt.

The reality is, your money might barely keep up with inflation and devaluation. Housing, Healthcare, Gas, and most energy costs have doubled or trippled in the past 5 years. So, if your investments doubled or trippled in the past 5 years, you are just braking even. Try picking up a copy of the 401K hoax (book) and you will realize why trying to save for retirement by the age of 60 is almost impossible at average wages and without a pension or social security.

I would rather have the 5 extra years of pay than a few extra dollars from upgrading earlier etc. In reality, age 65 will probably effect your upgrade or career advancement by 2-3 years, and you will have 5 years of extra earnings at future pay rates (which will be higher than todays due to inflation and devaluation of the dollar).

Oh, good grief. The average person, investing in stocks and mutual funds, will achieve a rate of return of between 8-10% a year. Inflation has averaged about 3.5% a year since the end of the great depression. Even less over the past couple of decades. That means that your rate of return will be over double the increase in the cost of living. There are some calculators out there on the net that will help you calculate, accounting for average inflation, the amount of money you'll need at retirement to keep the same standard of living that you're used to. The idea that a pilot can't put enough money away for retirement using a 401k or B-Fund is asinine.

401k "Hoax?" Where do you people come up with this crap?

 

[SWA/FO]

As long as it don't pass before November, I'm hopin' to get rid of someone over here....

You got that right, November 27th to be exact - at least over here at Southwest.

 

[Boeing747Driver]

Just finished reading the bill, as amended for the Age 65 provision. Items of note:

1. No one can return with seniority if they have already reached the age of 60 before the day the bill goes into affect. Already past 60? Tough luck, geezer.

2. No new medical standards, except that age 60+ pilots must maintain a 1st class medical with an examination every 6 months. No letting it lapse to 2nd class privileges if you're a copilot.

3. International ops require the other pilot to be under age 60. That should make for some interesting abrogations of seniority.

4. The new age limit is prohibited from being used as a basis for litigation. This protects all parties, including labor unions, from lawsuits related to the age limit.

5. Requires airlines to engage in negotiations with labor unions if the CBAs require changes to benefits or work rules as a result of the new age limit.

6. The GAO will make a report in 2 years on how the change has affected operations.



Thanks geezers. You've slowed seniority progression and kept furloughees at AMR on the street for even longer. Not to mention the loss in career earnings that most pilots will suffer because of this. Selfish bastards....

Come on PCL. This is what ALPA wanted and you are their best cheerleader. Am I seeing a change of attitude?

 

[Beetle007]

Sorry, you don't get to assume 500K 20 years from now.

Then you don't get to assume that investments will increase 6% a year. That is an assumption just like mine. Investments could just as easily decrease 6% a year for the next 15 years. People like to look at the past 30 years in America and assume our economy will sustain such growth. Our economy could just as easily go into the toilet and the stock market crash when all the baby boomer retirees start using their 401K (stocks) to pay for their retirement or the Chinese cash in their bonds.

Our goverment will have to intentionally devalue the dollar to pay for all the debt we have incurred and to pay for social security for the baby boomers. This will offset any gains made by investments.

As more people invest in stocks, your slice of the pie proportionaly becomes much smaller for every dollar you invest. People want to invest, but there are a limited number of invetments. This is what has artificially driven up stock prices for the past 20 years. Stock prices have greatly outpaced corporate earnings growth. People no longer invest for a percentage of the dividends (the original intent of investments), but only for appreciation of the stock price. When the baby boomers cash in, I don't think your 6% assumption will hold water.

 

[PCL_128]

Come on PCL. This is what ALPA wanted and you are their best cheerleader. Am I seeing a change of attitude?

This is not what ALPA wanted. This is what Prater wanted. Big difference. The EC and EB voted to amend policy for the exact reason you see here today: the rule was going to change with or without our support. Because of a change in policy, ALPA was able to lobby for the protections that made it into the final bill. The original proposal in Congress contained no protections from litigation, nothing to stop over-60 pilots from demanding a return with seniority, nothing to protect current medical standards, etc... Had ALPA not changed policy, then they would not have been able to work with guys like Oberstar to get these additions into the bill so we could have the minimal protections. I hate the change to the rule, but ALPA did the right thing in working within the system on this one. Had they stood on the sidelines and cried about it like the APA, then we could very well have seen a bunch of lawsuits from the geezers demanding to return at their previous seniority.

 

[PuffDriver]

Then you don't get to assume that investments will increase 6% a year. That is an assumption just like mine. Investments could just as easily decrease 6% a year for the next 15 years. People like to look at the past 30 years in America and assume our economy will sustain such growth. Our economy could just as easily go into the toilet and the stock market crash when all the baby boomer retirees start using their 401K (stocks) to pay for their retirement or the Chinese cash in their bonds.

Our goverment will have to intentionally devalue the dollar to pay for all the debt we have incurred and to pay for social security for the baby boomers. This will offset any gains made by investments.

As more people invest in stocks, your slice of the pie proportionaly becomes much smaller for every dollar you invest. People want to invest, but there are a limited number of invetments. This is what has artificially driven up stock prices for the past 20 years. Stock prices have greatly outpaced corporate earnings growth. People no longer invest for a percentage of the dividends (the original intent of investments), but only for appreciation of the stock price. When the baby boomers cash in, I don't think your 6% assumption will hold water.

You are out of your mind. There are guaranteed places out there for 6%. Hell, I have a 5.5% interest bearing account, and it would go to 5.75 the day I hit over 500K. Obviously you know nothing of investing.

Of course, I used the word guarantee, which nothing is. I will say this, however, if you can't make 6% interest on your money, then there IS NO aviation system in America--it will have to be that bad.

Either way, my logic is there and yours is not.

 

[DashTrash400]

Enjoy the extra five years, fellas...consider it our "atta-boy" for doing such a crackup job protecting scope so those of us not fortunate enough to be born in the 50's can fly for mainline someday.

[/bitter]