SkyWest Employee Stock Purchase Program and 401K

[SKYWRJGUY]

Nev:

As you can see earlier, that was one of my questions I'm going to seek clarity on. I'd rather put 10k in the 401k and 5k into the DCP if at all possible. Limit my downside in addition to the less than stellar fund choice, also avoid becoming a creditor to SKYW.

 

[Skywest Pylot]

- CONTRIBUTIONS ARE CONSIDERED ASSETS OF THE COMPANY AND ARE AVAILABLE TO SATISFY THE CLAIMS OF THE COMPANY'S CREDITORS IN THE EVENT OF ITS BANKRUPTCY OR INSOLVENCY

I cannot believe there are guys at SKYW who are considering the DCP. Do you guys have rocks for brains? If so, I've got a great retirement program for you. Just send me a check every month and I'll add it to my assets. When you get ready to retire give me a call and I'll let you know whether or not my finances are financially sound enough for a pay out. Sound good?

Those who fail to learn from history are sure to repeat it.

One more thing, the ESPP you now have sucks. I was digging around in storage the other day and I came across the "Total Compensation" fliers R.R. sent out a couple of years ago. Looks like the ESPP was considered part of your "Total Compensation". The profit sharing really isn't that great of a deal (especially compared to the huge potential upside of the next 1 or 2 ESPP periods). Make no mistake, you guys just took a paycut.

 

[CFIT]

The 10% ESPP difference is being added to the profit sharing.

The profit sharing program increased my hourly rate about $6.50 an hour.

With the DCP program I will be able to save more and with assigned non taxed payouts I should be relatively safe, but nothing is fool proof.

Honestly I'm still on the fence about the DCP.

 

[Nevets]

Nev:

As you can see earlier, that was one of my questions I'm going to seek clarity on. I'd rather put 10k in the 401k and 5k into the DCP if at all possible. Limit my downside in addition to the less than stellar fund choice, also avoid becoming a creditor to SKYW.

I see, maybe you can just fund a regular IRA instead.

It sounds like Skywest should have people pilots start with an automatic 3-5% contribution enrollment with an the option to opt-out and then separate the pilots from the ADP/ACP computations and that should solve the HCE problem.

The 10% ESPP difference is being added to the profit sharing.

The profit sharing program increased my hourly rate about $6.50 an hour.

Honestly, I would rather have the $6.50 an hour (or even a bit lower) built into my wage and ditch the profit sharing.

 

[CFIT]

Nevets,
As strange as it may seem I agree with both, I wish the company did an automatic enrolement and the the income was fixed. I know for some it has been a hardship when you don't know what the profit sharing is going to be and you can't use the income for say a loan app.

But overall I still feel SkyWest is as good as any of the others and also as rock solid as an airline can be in this day and age.

 

[Nevets]

Nevets,
As strange as it may seem I agree with both, I wish the company did an automatic enrolement and the the income was fixed. I know for some it has been a hardship when you don't know what the profit sharing is going to be and you can't use the income for say a loan app.

But overall I still feel SkyWest is as good as any of the others and also as rock solid as an airline can be in this day and age.

Doesn't seem strange to me at all. It makes sense.

 

[SKYWRJGUY]

401k: Fully funded.
Roth IRA: Over the limit (past couple of years).
Traditional IRA: Fully funded.
DCP: Enrolled, funded.
Savings: Check + small contributions.
Addtl Discretionary Cash: Hopefully by May

Apparently the pilots-only disrcimination test failed as well Take the good while it's still going...

 

[Nevets]

401k: Fully funded.
Roth IRA: Over the limit (past couple of years).
Traditional IRA: Fully funded.
DCP: Enrolled, funded.
Savings: Check + small contributions.
Addtl Discretionary Cash: Hopefully by May

Apparently the pilots-only disrcimination test failed as well Take the good while it's still going...

Over here they offer a Roth 401k or even after tax contributions to your 401k. Then at least you could contribute to the maximum that law allows ($15.5k for 2008). Maybe you ought to look into getting that set up there as well.

 

[Gr82Aviate]

401k: Fully funded.
Roth IRA: Over the limit (past couple of years).
Traditional IRA: Fully funded.
DCP: Enrolled, funded.
Savings: Check + small contributions.
Addtl Discretionary Cash: Hopefully by May

Apparently the pilots-only disrcimination test failed as well Take the good while it's still going...

How do you fund "over the limit"?...and didn't think you could fund the Roth IRA "over the limit",and fund a traditional IRA at the same time??..!!

 

[trip]

401k: Fully funded.
Roth IRA: Over the limit (past couple of years).
Traditional IRA: Fully funded.
DCP: Enrolled, funded.
Savings: Check + small contributions.
Addtl Discretionary Cash: Hopefully by May

Apparently the pilots-only disrcimination test failed as well Take the good while it's still going...

Living in mom's basement and spending weekends and freetime with a killer online gaming system.

 

[SKYWRJGUY]

I didn't fund them over the limit; I'm over the income limit for funding it. I think SkyWest is going to have the Roth 401k next year, as rumor has it--while there may be no income limit (and there isn't a restrictive one for me and the 401k), I'm sure it'll still be privvy to the dreaded discrimination test...

 

[Nevets]

I didn't fund them over the limit; I'm over the income limit for funding it. I think SkyWest is going to have the Roth 401k next year, as rumor has it--while there may be no income limit (and there isn't a restrictive one for me and the 401k), I'm sure it'll still be privvy to the dreaded discrimination test...

The $15.5k limit still applies for the Roth 401k. You cannot go over that limit in combined contributions to your 401k and Roth 401k. At least that is the way I understand it at XJT.

 

[SkyW120]

The $15.5k limit still applies for the Roth 401k. You cannot go over that limit in combined contributions to your 401k and Roth 401k. At least that is the way I understand it at XJT.

I believe the only way to extend the limit is to fully fund the 401k, $15,500 this year, and then set up a separate Roth IRA outside the company and max that out at $5,000/ year - letting you stash away $20,500/year.

If I understand it correctly, if you do the company Roth 401K, you are limited to $15,500/year - I must be missing something here, but why would you limit yourself to $15,500/year when you can set up a separate Roth and save a combined $20,500/year?

This assumes you make less than the Roth limit of $105,000/year.

 

[sweptback]

I'm not really sure what the benefits of the Roth 401k are, assuming you already fund your 401k and Roth IRA.

 

[Nevets]

I believe the only way to extend the limit is to fully fund the 401k, $15,500 this year, and then set up a separate Roth IRA outside the company and max that out at $5,000/ year - letting you stash away $20,500/year.

If I understand it correctly, if you do the company Roth 401K, you are limited to $15,500/year - I must be missing something here, but why would you limit yourself to $15,500/year when you can set up a separate Roth and save a combined $20,500/year?

This assumes you make less than the Roth limit of $105,000/year.

I'm not really sure what the benefits of the Roth 401k are, assuming you already fund your 401k and Roth IRA.

The Roth 401k does not have an income limit. Also, you may want to put the whole $15.5k into the Roth 401k and also put another $5k in a Roth IRA. If you have a Roth 401k and a regular 401k, it also gives you the ability to put some money away before taxes and some after taxes.