Who can afford to retire? I do not think that there will ever be any early retirements anymore. More senior, expensive people on the property, for longer. I do not know the exact numbers, but they are substantial...48% of the mailine pilots are over 50 and all but three (or twelve, I have seen both numbers) are over 40. It looks like a great time to downsize more over the next ten years.
On 1/15/2003 12:27:31 PM chipmunn wrote:
do you think there will be any who decide to go early? I know I would be headed out the door today, before the pension was terminated. Which raises the question. Will the termination of a pension plan affect those who have already retired?
I don't think the lump sum will figure in at all, since you can still get one for the amount earned prior to the latest TA. I think you still have to wait to age 60 to get it. The only thing it will effect is the ability to accrue over 50% benefits, but they are also grandfathered for amounts earned prior to the TA. For those that don't know, the pilots can take a "lump sum" in lieu of payments. Basically, instead of the company buying an annuity with your retirement funds to pay you monthly, they just give it to you to invest. This has bitten many pilots in the past, since pilots (and doctors, I hear) are notoriously bad investors.
Chip answers: Mike, a one time large retirement payment wit no monthly annuity available for an age 60 retirement, unless the 30 year treasury has a y8ield of 7.5 percent, then its available for early retirement.
Mike asked: I thought the pilot retirement was a monthly payment based on thier earnings? Also, how would a termination of the plan affect those who have retired?
Chip answers: Pilots have the option of an annuity or lump sum distribution at age 60 and an annuity for an early retirement. If the plan is terminated, retirees would see reduced benefits and those who have received a lump sum could have to pay this back to the government, although this is unlikely.
If the plan is terminated, retirees would see reduced benefits and those who have received a lump sum could have to pay this back to the government, although this is unlikely.
Interesting. It would seem to me that the reason for the lump sum option was to protect yourself from anything that could affect your retirement. In other words, the whole plan may fall apart, but at least I have my lump sum payment. I can't believe that there could be any requirement to pay the lump sum back. I mean, what if the pilot has spent it?(doubtful, but possible in theory)