Certainly a good deal for those hired after 2001. If the choice was a pension or a 401k, this is likely a good deal for the pre-2001 hires as well. The extra week of vacation is excellent.

The devil is definitely in the details. Defined benefit plans are hard to "replace" with 401K's. For the Pre-2001 folks, it depends upon how their benefits are calculated. Each year tends to build benefits, so if they aren't allowed to continue to build "years of service" they get screwed out of benefits. "Age at retirement" also becomes important. If they are now considered "retired" by the plan, they can also get screwed.

Defined benefit plans were very valuable. Once one gets beyond about 45 or 50 years old, it is hard to "buy them out" because they are so valuable. Don't be surprised if there aren't a few lawsuits by people who want a better deal.

Defined-benefit pensions were great for lots of workers, but they are dinosaurs given today's workplace and tax code. Time for something better.

Too much volitility and no shared feature. A defined benefit plan pooled the resources of the employees so they could all benefit together. 401K's split us up into individuals and make us prey for the kinds of market variations we are living through.

What would be better?

that was the "reasonable" talking point from the other party.

evil creeps in on the paws of kittens.

Retirement looks different to everybody.

But ask someone who worked for US Steel, Eastern Airlines or one of many companies that have gone bust if they'd have preferred a portable, individual account or an account that is effectively "owned" by your company.

A 401(k) only subjects you to market volatility if you want it to. There are plenty of more conservative, value-based investment options in a 401(k) than the aggressive-growth elections that are high risk.

http://money.cnn.com/2001/11/26/401k/q_retire_enron_re/

401(k) investors sue Enron

November 26, 2001: 2:36 p.m. ET

Employees who lost their retirement funds on company's shares fight back

HOUSTON (Reuters) - After climbing utility poles in all kinds of weather for 35 years, Roy Rinard was hoping to retire in a few years. But that was before the collapse of Enron Corp.'s stock price devoured his retirement savings.

"I'm basically wiped out," said Rinard, 54, who works for Portland General Electric, an Oregon utility company acquired by the Houston-based energy trading firm in 1997.

"I'm right back to ground zero and I'll have to go on working as long as I can," said Rinard, who suffers from arthritis and a lung condition that leaves him short of breath.

Encouraged by Enron's then-strong performance and the company's bullish view of its future prospects, Rinard moved all of the money invested in his 401(k) retirement account into Enron stock earlier this year.

But it proved to be a costly decision as the value of his account fell from $470,000 a year ago to around $40,000 today.

------------------------------------------------------

Pole climber had no idea his Enron stock was "high risk", until after it was too late for him. He didn't get any inside information like some were getting. The top dogs all knew what was up and got out with their cash but guys like Mr. Rinard had no idea what was coming. How do we prevent that?

Don

Esp. in YOUR company stock
unless you know what you are doing.
This poor guy did not even diversify his investments, sounds like.

Didn't Enron's management made it impossible for holders of Enron stock in their 401k's to sell their shares while the stock was tanking? I talked a number of years ago with a formewr Enron employee who had a very similar experience - all his retirement money in Enron stock and unable to sell as it was going under.

Thank you for reminding me of that part of this story.

Don

Take control of your money.

Who knew?

Because whatever improvements we negotiated in pay and benefits supervision always got a little more. Us union workers were setting the pattern for what our supervisors made.

Don

Management's salary is most certainly based upon what the workers make.

GM needs to do, fairly, whatever it takes for it to be a successful company. Not too many cos. provide pensions anymore. GM has to be competitive.

I'm sure we'd all like pensions, like many of our fathers got. But that is not to be.

Pensions were not as secure as people think, though. It was easier to steal the $ than it is with 401ks, and they are lost more easily in bankruptcies, I think.

And another one bites the dust.

The pensions offered by companies started being phased out decades ago because of the cost and fraud. And GMs pensioners from days past...they lost their pensions in the BR GM went through. I might be wrong, but I think a 401k would've made it thru a bankruptcy, since it's not "part" of the company, but is separately held by an investment company.

Pensions are company funds that are used to pay future pensioners. They're invested, but the employees, I think, have no say HOW the funds are invested. So it's easier for company officials to raid the fund by fraud w/o anyone knowing.

401k doesn't get you as much $$$, not nearly as much. But it's the way things have gone in the last 20 years. What's bad about 401ks are the fees.

"Those bonuses will be tied to GM's global performance." Why should a guy who works the assembly line have his pay tied to the corporate boom and bust cycles of the global economy?

Who the hell is going to stick around and suffer this theft disguised as a rank insult? I sure hope salaried workers aren't important to the overall business plan or else the entire company could be threatened; salaried, waged, stockholder, executive...

And let the workers decide how and where to save for their retirements. Corporate and government pensions are a big juicy target for corrupt CEOs and Governors to play money games with.

I say pay workers higher wages across the board now, and let the individual worker decide where and how to plan for their own retirement.

Because that is the way it is supposed to be.

Wouldn't that be the better plan?

We were taught in high school how well we retired would depend on having three things. A pension, savings, and Social Security. With the combination of those three things people should be able to have a pretty good retirement. And they did.

Don

You cannot trust corporate America and various governments to protect your pension. They will steal it. It's literally like asking a fox to guard your hen house.

Give workers higher wages and let them save and invest their money as they so please.

eliminated pensions for the younger employees about ten years ago.

I was one of the few more senior employees who were the last to receive a pension. I consider myself fortunate.