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Old 01-03-2015, 04:35 PM
 
143 posts, read 132,634 times
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Quote:
Originally Posted by HappyTexan View Post
Anyone who has an employer pension fund needs to be aware of what got passed because one day this law can affect your pension..public , private, single employer, etc.
Yup. I just had my "maximum 2% per year COLA (if warranted by inflation) cut. In the same session the legislature granted a 20% tax cut to S-corporations and gave enormous tax concessions to a well-known shoe company headquartered in the state.
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Old 01-03-2015, 04:41 PM
 
Location: Chesapeake Bay
6,048 posts, read 3,870,699 times
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I think that this issue will be looked at again.

Likely they'll put a cap on this type of pension. Maybe use the PBGC cap which was around $50k the last time I looked (a few years ago). And then logically (for them) apply it to all pension types (including local and fed gov'ts). Possibly including the military pensions as well.
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Old 01-03-2015, 04:58 PM
 
48,516 posts, read 83,912,172 times
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Sounds to me like the union did not want it going to PBGC and got it passed thru allowing them to manage it now. Likely contains specific language that limits it to those pensions. PBGC would still be the standard unless specific bill passed. fro example it looks like a unrealistic pension fund anyway.
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Old 01-03-2015, 05:07 PM
 
Location: Floyd Co, VA
3,415 posts, read 5,133,448 times
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Quote:
Originally Posted by Weichert View Post
I think that this issue will be looked at again.

Likely they'll put a cap on this type of pension. Maybe use the PBGC cap which was around $50k the last time I looked (a few years ago). And then logically (for them) apply it to all pension types (including local and fed gov'ts). Possibly including the military pensions as well.
That cap is now $60K but it is for single employer plans only. Plans into which many employers contributed are capped at $12,870 from the PBGC. Those employers only had to pay $12.00 per year, per employee into that insurance fund. They will now have to pay in a whopping $26.00 a year.
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Old 01-03-2015, 06:04 PM
 
Location: Chesapeake Bay
6,048 posts, read 3,870,699 times
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Quote:
Originally Posted by zugor View Post
That cap is now $60K but it is for single employer plans only. Plans into which many employers contributed are capped at $12,870 from the PBGC. Those employers only had to pay $12.00 per year, per employee into that insurance fund. They will now have to pay in a whopping $26.00 a year.
That is interesting. So much for that thought. No wonder they didn't want to be in PBGC. Looks like they may now be in the equivalent.
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Old 01-03-2015, 06:04 PM
 
Location: Near a river
16,042 posts, read 18,971,705 times
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Quote:
Originally Posted by HappyTexan View Post
This was part of the spending bill just passed and affect ALL multi-employer pension plans.
It was a deal worked out between the unions and 2 Congressmen who authored the bill..one Democrat and one Republican so there should be no quibbling over politics regarding this law.

Instead of the pension going to the PBGC in case of default the unions get to keep administering the pensions and are allowed to make cuts themselves. Besides that the other new item in the bill is the change to ERISA that will allow them to cut retirees currently receiving pensions.

Yes, this is a HUGE deal because it sets a precedent for all other pension plans in the future.
Once on a pension you are no longer guaranteed a steady income up until you turn 80 years old at which time you are protected.

It's bad mojo folks. The multi-employer pensions are in the worst shape today and are the first to go down this path but don't for one minute think it will end there.

Anyone who has an employer pension fund needs to be aware of what got passed because one day this law can affect your pension..public , private, single employer, etc.

OK I am dumb about such things since I am not a pensioner, however...class action suit? Some legal recourse to this awful development?
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Old 01-03-2015, 06:08 PM
 
Location: Wisconsin
21,536 posts, read 43,992,643 times
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Retire at age 55, at full pay, at current lifetime benefit of $76k/year, after only 27 years of work. And, thus, the old adage "if it's too good to be true....."

Congress did pass this in the dead of night, most Democrats objecting, but voting anyway b/c of fear of shutdown. Discussed on C-Span, here:

Washington Journal Karen Friedman Pension Cuts | Video | C-SPAN.org

Another thread on the issue, here:

2015 Omnibus Spending Bill Cuts Pensions

I suspect, when all is said and done, your benefit may be reduced to something like $45k/year, worst case. Also, you'll be eligible for SS soon - although you may be planning to delay collection of that which would be an excellent plan.
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Old 01-03-2015, 06:12 PM
 
Location: Wisconsin
21,536 posts, read 43,992,643 times
Reputation: 15135
Quote:
Originally Posted by newenglandgirl View Post
OK I am dumb about such things since I am not a pensioner, however...class action suit? Some legal recourse to this awful development?
You can't get water from a stone. If the plan is substantially underfunded, where does the money for the benefit come from? One, of course, can sue if the trustees are abusing their power in the determination of reduced benefits. But, that remains to be seen. So far, OP is still getting his full benefit. New law, no precedents/basis for legal action, yet.
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Old 01-03-2015, 07:00 PM
 
Location: Baltimore, MD
3,745 posts, read 4,216,058 times
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The PBGC's multi-employer pension "MEP" program fund was projected to have a 42 billion dollar DEFICIT. This may explain why Congress was willing to allow the MEP Trustees to bypass the PBGC by reducing the benefits of their retirees as needed. The PBGC basically advised Congress its MEP program fund would implode (my words) if even a few of the larger pension funds became insolvent.

Zucor, as far as I know, insolvency means zero assets in the pension.

ETA: I agree this is a very bad omen for pensions in general. I wouldn't be surprised if Congress also allows the Social Security Disability Trust fund to take a full hit immediately before it becomes insolvent in 2016. These sure are interesting times!
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Old 01-03-2015, 09:17 PM
 
Location: Great State of Texas
86,093 posts, read 72,489,649 times
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Quote:
Originally Posted by newenglandgirl View Post
OK I am dumb about such things since I am not a pensioner, however...class action suit? Some legal recourse to this awful development?
Against who..Congress and the President ?
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