Were you FT/PT for those 10 years?
Pension Buyout
- Thread starter alex cariello
- Start date
UpstateNYUPSer(Ret)
Well-Known Member
How much would you receive cumulatively if you waited until 65 to start collecting?
Mapp
Choo Choo
350.00 a month. Or 45.00 a month starting now.
UpstateNYUPSer(Ret)
Well-Known Member
You would obviously take the lump sum now rather than $45/month.
$350*12*25=$105,000.
90% discount if you want it now.
Mapp
Choo Choo
Yeah,
Yeah, doesn't seem worth it to me. Even though 359.00 a month won't be worth much in 30 years, it might still be enough to cover an electric bill or something.
UpstateNYUPSer(Ret)
Well-Known Member
Conversely, you should calculate how much $10.5K would grow to by the time you turn 90.
fergferg77
New Member
10 years part time mgmt. Benefit amount at 65 is $388/month. Lump sum offer of ~$15K or about $70/month for life. Worked from 2001 to 2011 there and finished making somewhere around $21K a year. I am 39, so I assume that one's current age has something to do with their calculatuons on the offer......if I were older or much closer to 65, maybe it would be more. Thought about calling to barter a higher amount, but sure Im just a number and they would be like whatever, if I could even get through to someone that could make a decision like that. I swear my benefit amount was less when the number was put in front of me when I left, maybe closer to 300 than 400 a month. Does anyone one know if our UPS part time mgmt pensions actually increase by some amount over time to account for inflation or is it locked in? It's rare that traditional pensions like this do that but now I'm wondering? Sure it doesn't, but I don't trust em now any more than when I worked there. Pretty clear cut on what they are trying to accomplish though. My lump sum is just over 3 years worth of my pension if I were to take it now.
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UpstateNYUPSer(Ret)
Well-Known Member
Pensions for the most part do not offer cost of living raises.
Let's assume that you are 40 and that you will live to 90.
$70/month times 12 months times 50 years equals $42K.
$388 * 12 * 25 = $116,400.
$15K invested in a Traditional 401k at age 40 will grow to just over $70K by age 65.
That same $15K rolled over to a Roth will grow to just over $81K.
Take the lump sum and dump it in a Roth IRA.
Let's assume that you are 40 and that you will live to 90.
$70/month times 12 months times 50 years equals $42K.
$388 * 12 * 25 = $116,400.
$15K invested in a Traditional 401k at age 40 will grow to just over $70K by age 65.
That same $15K rolled over to a Roth will grow to just over $81K.
Take the lump sum and dump it in a Roth IRA.
Mugarolla
Light 'em up!
And that money dumped into a Roth IRA will continue to earn a return and grow beyond age 65. You used a 7% return, so at that return, once you turn 65 you can withdraw over $544 a month for the next 25 years.
A UPS pension would give you $388/mo. The lump sum invested now would give you around $544/mo. That is an extra $47K. And if something happened to you, your heirs get all the money. With a UPS pension, they do not.
The drawback is that you are relying on the market for your rate of return. Can the market maintain that 7% average for the next 55 years?
fergferg77
New Member
Thanks UpstateNYUPSER and Mugarolla. Good points and I appreciate your easy to follow numbers on everything for perspective. Given that and the fact my pension doesn't pass on to a beneficiary if something were to happen (I wasn't aware of that), I'm going to take the lump sum and run.
Brown echo
If u are not alive than for sure truth is not real
Brown echo
If u are not alive than for sure truth is not real
Pensions are timeshare both sold to crocks bankers who run and ruin our lives , Pensions which options allow your remaining amount at your death to be passed onto your wife/husband!!
UpstateNYUPSer(Ret)
Well-Known Member
Pensions do have a surviving spouse benefit but I believe it is only for 5 years after the death of the member.
Mugarolla
Light 'em up!
Depends on the plan
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Mugarolla
Light 'em up!
Some have a payout upon death. The Full Time UPS/IBT pension has a payout of $10,000 if at least 10 years vested provided that the employee is still in the plan. The people getting these letters are no longer in the plan.
There may be a 50% survivors benefit, but that is only for a spouse. If the person is not married, UPS pays nothing for this pension if the person dies. Whereas, with the Roth option, the money is payable to his designated beneficiary.
And even with the 50% option, that means his spouse would get less than $200/mo if the person were to die before age 65.
With the Roth, the surviving spouse would get the same amount, $544/mo, for the rest of her life.
If she lived to be 90, 25 years of retirement payments, the difference is over 75K going to the spouse.
And if she was to pass away, the remainder of the Roth goes to her heirs. The UPS 50% pension would stop at the time of her death.
There may be a 50% survivors benefit, but that is only for a spouse. If the person is not married, UPS pays nothing for this pension if the person dies. Whereas, with the Roth option, the money is payable to his designated beneficiary.
And even with the 50% option, that means his spouse would get less than $200/mo if the person were to die before age 65.
With the Roth, the surviving spouse would get the same amount, $544/mo, for the rest of her life.
If she lived to be 90, 25 years of retirement payments, the difference is over 75K going to the spouse.
And if she was to pass away, the remainder of the Roth goes to her heirs. The UPS 50% pension would stop at the time of her death.
pat sornsin
New Member
I've recently got mine in, I worked there from 8/88. - 5/12.
Was offered 360k as a buy out or monthly payments any where from my top of 3000k to 1500k depending on what option i chose .and it's only for those that don't work there anymore
Brown echo
If u are not alive than for sure truth is not real
10 years.
MC4YOU2
Wherever I see Trump, it smells like he's Putin.
The Western Conference Teamsters plan I'm in has an optional death benefit, available to your beneficiary, that's equal to 48 months of the monthly benefit. It's reduced by each monthly check for 4 years until it's zeroed out. Also, depending on which payout you choose you can get your spouse (non transferable) about 75% of your monthly benefit, but you must agree to a reduced payout for you both in the meantime.
If you pass first, your spouse gets that smaller 75% amount. If your spouse passes first, you would then get your benefit increased to the maximum monthly payout. If you remarry, your future spouse gets zero, if they outlive you.
If you pass first, your spouse gets that smaller 75% amount. If your spouse passes first, you would then get your benefit increased to the maximum monthly payout. If you remarry, your future spouse gets zero, if they outlive you.
35years
Gravy route
In order to make an informed decision you have quite a few variables to evaluate;
Survivor benefits, age, age expectancy of yourself and spouse (health history and genetics considered), investment risk adversity, tax implications etc. etc.
You will need to do quite a bit of research to make an informed decision, or speak to a competent financial adviser.
Here is an online Pension calculator to get started, but a great deal more research would be wise...
Pension calculator
Survivor benefits, age, age expectancy of yourself and spouse (health history and genetics considered), investment risk adversity, tax implications etc. etc.
You will need to do quite a bit of research to make an informed decision, or speak to a competent financial adviser.
Here is an online Pension calculator to get started, but a great deal more research would be wise...
Pension calculator
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