Join Early Retirement Today
View Poll Results: Which would you rather have? DB or DC plan?
DB 35 67.31%
DC 17 32.69%
Voters: 52. You may not vote on this poll

Reply
 
Thread Tools Search this Thread Display Modes
Old 05-29-2013, 03:39 PM   #21
Thinks s/he gets paid by the post
Big_Hitter's Avatar
 
Join Date: May 2013
Location: In the fairway
Posts: 4,092
^ hey, it's difficult being a visionary sometimes...(did you read the fox article?)
__________________

__________________
Big_Hitter is online now   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 05-29-2013, 03:40 PM   #22
Moderator Emeritus
 
Join Date: May 2007
Posts: 11,031
Quote:
Originally Posted by Big_Hitter View Post
^ not if enough people start demanding it

I think we are about to be in a situation where private sector employers will be competing for talent (and, the only way to fund retirement benefits quickly to attract such talent is through a DB plan)
Based on the history of broken DB plan promises in the private sector, I really don't see how anyone could fall for that one again. Gimme the money up front, thank you very much.
__________________

__________________
FIREd is online now   Reply With Quote
Old 05-29-2013, 03:44 PM   #23
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
mickeyd's Avatar
 
Join Date: Apr 2004
Location: South Texas~29N/98W
Posts: 5,880
Tough choice~ w/o guarantees that they are equal in value. I happen to have both and can appreciate both. The income streams are nice to see when the roll in each month and the rollover IRA is nice to have and be able to manage as I see fit.

Yea, I want it all.
__________________
Part-Owner of Texas

Outside of a dog, a book is man's best friend. Inside of a dog, it's too dark to read. Groucho Marx

In dire need of: faster horses, younger woman, older whiskey, more money.
mickeyd is offline   Reply With Quote
Old 05-29-2013, 03:44 PM   #24
Thinks s/he gets paid by the post
Big_Hitter's Avatar
 
Join Date: May 2013
Location: In the fairway
Posts: 4,092
Fired - based on the fox article, I'm not the only one with that opinion - only time will tell

what will help will be a wave of talent taking early retirement under the ACA exchanges and a wave those destitute with lack of DB income

I read somewhere recently that the probability of one living in poverty is 8 times higher without DB income (not just SS)
__________________
Big_Hitter is online now   Reply With Quote
Old 05-29-2013, 03:45 PM   #25
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Midpack's Avatar
 
Join Date: Jan 2008
Location: Chicagoland
Posts: 11,962
Quote:
Originally Posted by Big_Hitter View Post
^ hey, it's difficult being a visionary sometimes...(did you read the fox article?)
If you're talking to me (use quote function), it didn't do anything for me.
Quote:
In 2011, the last year studied, defined-benefit plans had median returns of 2.74%, while 401(k)s and other defined-contribution plans lost 0.22%. It was the widest margin since the mid-1990s, the company said.

If you leave a large company, you might want to leave your money in the 401(k) plan instead of rolling it into an individual retirement account, suggests Dave Suchsland, a senior consulting actuary with Towers Watson.
Huh? And I did much better than 2.74% in 2011 including my lump sum...
__________________
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57

Target AA: 60% equity funds / 35% bond funds / 5% cash
Target WR: Approx 2.5% Approx 20% SI (secure income, SS only)
Midpack is offline   Reply With Quote
Old 05-29-2013, 03:48 PM   #26
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: May 2005
Posts: 13,252
Quote:
Originally Posted by Big_Hitter View Post
^ I think the plan formula would be 1% final pay times YOS less 1% PIA times YOS so you would only subtract out 30% of PIA in your example or $300; then you would get $950 a month.

I do not know.... and have no way of checking.... I do remember the example showing what looked like full SS... but that was maybe 20 years ago....

They also closed it down soon after I was in it.... maybe in it two years...
__________________
Texas Proud is online now   Reply With Quote
Old 05-29-2013, 03:49 PM   #27
Thinks s/he gets paid by the post
Big_Hitter's Avatar
 
Join Date: May 2013
Location: In the fairway
Posts: 4,092
is this how one uses the quote function?

Quote:
Originally Posted by Midpack View Post
If you're talking to me (use quote function), it didn't do anything for me.



"Don't rule out the return of pensions. The bottom line of the Towers Watson research is this, in Suchsland's words: "For a plan sponsor to provide a certain level of benefit, it is cheaper to finance through the defined-benefit plan." Even though traditional pensions present more accounting challenges(because they are carried on company balance sheets), Suchsland says he believes some employers who switched to defined-contribution plans in the past few decades may switch back because of pension efficiencies and "workforce issues."
__________________
Big_Hitter is online now   Reply With Quote
Old 05-29-2013, 03:50 PM   #28
Thinks s/he gets paid by the post
Big_Hitter's Avatar
 
Join Date: May 2013
Location: In the fairway
Posts: 4,092
Quote:
Originally Posted by Texas Proud View Post
I do not know.... and have no way of checking.... I do remember the example showing what looked like full SS... but that was maybe 20 years ago....

They also closed it down soon after I was in it.... maybe in it two years...
understood - i'm pretty sure that 1% fap * yos minus 100% PIA doesn't satisfy the IRS anti-backloading rules
__________________
Big_Hitter is online now   Reply With Quote
Old 05-29-2013, 04:56 PM   #29
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Chuckanut's Avatar
 
Join Date: Aug 2011
Location: West of the Mississippi
Posts: 6,315
If I knew the DB plan would be well funded and managed for the benefit of the retirees with no chance of the "excess" funds being raided to fund other things for the corporation, and not dependent on the corporation surviving beyond my retirement, and had some type of cost of living adjustment (whole or partial), and my contribution a reasonable part of my salary (say no more than 8%), I would go for it.

Other than that, just give me the money (preferably a generous amount) and let me invest it tax differed if not tax exempt for whenever I choose to retire.
__________________
The worst decisions are usually made in times of anger and impatience.
Chuckanut is offline   Reply With Quote
Old 05-29-2013, 06:24 PM   #30
Thinks s/he gets paid by the post
mpeirce's Avatar
 
Join Date: Feb 2012
Location: Columbus area
Posts: 1,589
I'm thankful I had DC plans available since I would have never qualified for a DB plan. Too much job hopping.
__________________
mpeirce is online now   Reply With Quote
Old 05-29-2013, 06:48 PM   #31
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
travelover's Avatar
 
Join Date: Mar 2007
Posts: 9,871
I'd like to have a DB plan from an independent third party - i.e. not tied to one employer. Unlike SS, it would have my name on the account and it would be mine all mine!
__________________
Yes, I have achieved work / life balance.
travelover is offline   Reply With Quote
Old 05-29-2013, 08:17 PM   #32
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Mulligan's Avatar
 
Join Date: May 2009
Posts: 7,369
I have a nice pension that is drawn from a trust fund that cannot be raided. 14.5 % mandatory contribution with 14.5% matched from employer. It is a very nice sound system with 2% annual cola. I don't trust myself to be a successful investor, so I am thankful for my pension. I deposit money monthly into the market and consider it gone, and never plan to touch it. I am afraid it I had a DC plan with sizable monies in it and no pension, I would go crazy staring at the daily gains and losses.
__________________
Mulligan is offline   Reply With Quote
Old 05-29-2013, 08:24 PM   #33
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
pb4uski's Avatar
 
Join Date: Nov 2010
Location: Vermont & Sarasota, FL
Posts: 16,398
Quote:
Originally Posted by travelover View Post
I'd like to have a DB plan from an independent third party - i.e. not tied to one employer. Unlike SS, it would have my name on the account and it would be mine all mine!
Sounds like an annuity to me.
__________________
If something cannot endure laughter.... it cannot endure.
Patience is the art of concealing your impatience.
Slow and steady wins the race.
pb4uski is offline   Reply With Quote
Old 05-29-2013, 08:39 PM   #34
Thinks s/he gets paid by the post
JoeWras's Avatar
 
Join Date: Sep 2012
Posts: 2,516
Quote:
Originally Posted by FIREd View Post
I'd pick the DB plan, but only if it was COLA'd and from the Federal Government.
Bingo.

After watching what my Megacorp #1 did to their DB plan, I concur. They stripped it bare. It was never COLAd. You had to work there forever, etc. I was in the midst of all those changes and even though I worked there for over 10 years, my benefit will be ridiculous (less than $100/mo if I start at 65), which I why I say I don't have a pension, because in 15 years, I don't even know what that will buy.

Because of that bad experience, I'm in the DC camp. At least I have some control.

But I have to admit, from what I see here, some of the Federal DB plans are really tempting. If I were used to those numbers, and could work somewhere where they were a reality and a promise not to be messed with, I'd be all for it.
__________________
JoeWras is online now   Reply With Quote
Old 05-29-2013, 08:48 PM   #35
Thinks s/he gets paid by the post
 
Join Date: Sep 2009
Location: Hong Kong
Posts: 1,571
DC everytime. I trust the markets and myself to look after my money far more than I will ever trust any employer (including government) to stand by promises made today in forty years time.
__________________
Budgeting is a skill practised by people who are bad at politics.
traineeinvestor is offline   Reply With Quote
Old 05-29-2013, 09:35 PM   #36
Thinks s/he gets paid by the post
Big_Hitter's Avatar
 
Join Date: May 2013
Location: In the fairway
Posts: 4,092
Has anyone on this forum actually retired without a DB plan and without an inheritance?
__________________
Swing hard, look up
Big_Hitter is online now   Reply With Quote
Old 05-29-2013, 09:41 PM   #37
Thinks s/he gets paid by the post
JoeWras's Avatar
 
Join Date: Sep 2012
Posts: 2,516
Quote:
Originally Posted by Big_Hitter View Post
Has anyone on this forum actually retired without a DB plan and without an inheritance?
I'm pretty sure you'll get some affirmatives.

But you have a good point. I'm FI and should be REing. But I'm in OMY syndrome partly because of that uncertainty. And partly because of no health insurance (that frequently comes along with DBs).
__________________
JoeWras is online now   Reply With Quote
Old 05-29-2013, 09:45 PM   #38
Thinks s/he gets paid by the post
Big_Hitter's Avatar
 
Join Date: May 2013
Location: In the fairway
Posts: 4,092
Quote:
Originally Posted by JoeWras View Post
I'm pretty sure you'll get some affirmatives.

But you have a good point. I'm FI and should be REing. But I'm in OMY syndrome partly because of that uncertainty. And partly because of no health insurance (that frequently comes along with DBs).
There may be a few. I'm betting docs or lawyers who have been putting away the 415c limit for years. Next year you should be able to get good medical coverage on the exchanges at a moderate cost.
__________________
Swing hard, look up
Big_Hitter is online now   Reply With Quote
Old 05-29-2013, 10:03 PM   #39
Thinks s/he gets paid by the post
Katsmeow's Avatar
 
Join Date: Jul 2009
Posts: 3,392
Don't most places that have a DB also have some form of DC?

DH had a traditional DB plan, no COLA. When he retired he took it as a lump sum in a roll over instead of taking a pension. However, in addition, he had a DC and his employer matched 6% of his contributions.

By the time he retired megacorp had stopped the DB for newer employees. They had only a DC but the employer made a larger contribution than they made for DH.

I thought we had the best of both worlds with DH's plan. He had the DB but he had the option to take it as a pension or as a lump sum. I do think the ideal is to be able to split it and take some as pension and some as lump sum, but he didn't have that option. And then, in addition, he had the DC with the contributions by megacorp.

I worked in a field where DCs reign and where the employee typically makes an annual contribution that varies each year but is made regardless of whether the employee contributes.
__________________
Katsmeow is offline   Reply With Quote
Old 05-29-2013, 10:27 PM   #40
Full time employment: Posting here.
Calico's Avatar
 
Join Date: Apr 2012
Posts: 920
I have a very safe, secure, and generous DB with a private employer. I would take it again in a heartbeat. However, I may be in the minority in that I will shortly reach 25 years with this employer - no job hopping for me. Even though the pension is non cola, between the pension, social security, and my savings I will be fine.

I thank goodness every single day for the pension, and realize how lucky I am. These plans are a thing of the past.
__________________

__________________
Calico is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


 

 
All times are GMT -6. The time now is 11:00 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.