CO Nov 19th Class

[Hutchman]

So if you wait past age 60 to retire and you decide to take the lump sum, the calculations to turn an annuity into a lump sum will result in the value of the lump sum going down about 3% a year past age 60. The good news is that every year you are losing 3% from your lump sum in the A fund, the company is funding 12.5% into your B fund, so you still come out ahead about 9.5% for each year you delay retirement. Plus you get your salary those extra years you work as well. I hope this add some clarity and not confusion."
[

This assumes your lump sum is equal to a years pay. Some lumps are around 1 Million, a year pay maybe 200k-250k. You do not come out 9.5% ahead unless your lump is the exact same as 1 years pay. Don't forget about the rate change that is being implimented over the next few years that will base your lump on a higher rate which also will lower the payout on top of the 3% reduction. If you are getting close to retirement please consult a finacial planner and don't take the company or union's word for it.

 

[MECH]

This assumes your lump sum is equal to a years pay. Some lumps are around 1 Million, a year pay maybe 200k-250k. You do not come out 9.5% ahead unless your lump is the exact same as 1 years pay. Don't forget about the rate change that is being implimented over the next few years that will base your lump on a higher rate which also will lower the payout on top of the 3% reduction. If you are getting close to retirement please consult a finacial planner and don't take the company or union's word for it.

Here is another reason to worry about changing the age 60 rule.

This is due to a waiver under existing ERISA law which allows us a greater margin of contribution to "qualified" retirement plans, only because we have a Bona Fide Occupational Qualification (BFOQ) which mandates our retirement at Age 60. If you earn more than $170,000, the portion of your retirement ‘credits’ above that amount exceed the ERISA limits and are then considered "non-qualifying." Absent the BFOQ, the upper limit of your qualifying amounts would be reduced by 30 to 40 thousand dollars annually. Under the new tax law signed recently by Bush, these dollar amounts will increase, however that only serves to widen the gap bewteen the upper and lower limits of qualified vs. unqualified amounts. According to ALPA’s actuaries, they have estimated that the tax implications of this would reduce the retirement benefit of any Age 60 retiring pilot by 33% if the mandatory retirement age were raised just to 63. The effects are even worse if the limit is raised to 65. This is strictly due to the loss of the ERISA exemption for qualifying ($140,000) verses non-qualifying retirement monies up to the $170,000 income limit ($210,000 as of 12/31/01).

Simply stated, if Congress forces the FAA to change the Age 60 rule, we no longer have a Bona Fide Occupational Qualification upon which to base an exemption from ERISA limits to qualified retirement programs. No Age 60 Rule, no BFOQ. No BFOQ, retirement plan takes a 33% hit, increasing significantly as the higher limits kick in at the end of this year. Simple cause and effect. This isn't something that Congress will have to debate or have the opportunity to tinker with or be lobbied by ALPA's Legislative Affairs people. It will simply go away immediately with the introduction of any rule which lifts the Age 60 rule. Are you still ambivalent about changes to Age 60?

 

[SuperFLUF]

If someone retires at 60 and the rule is changed can they come back to work till 65??

Not as the bill is currently written. It specifically prohibits this unless they want to reapply and hire on as a new hire. (highly doubtful as its not about a love of flying or protecting the world from less experienced pilots, its just about the Benjamins)

 

[pkober]

Once the lawyers are done with the elections today they'lle start working with retired pilots demanding there jobs back. I heard Hoot called one already.

 

[whymeworry?]

Once the lawyers are done with the elections today they'lle start working with retired pilots demanding there jobs back. I heard Hoot called one already.

The "ME" generation continues to assert it's will on American society.