Retire now or lose your pension.

my husband works for a large international company. been with them 41 years. about 12 years ago they changed their pension plan. the new plan sucks. because of his years of service he remained on the old plan.

now the company has said if you don't retire now, you'll lose your pension. they've given the employees till the end of the year to make their decision.

hubby will be 63 in december. he doesn't want to retire. he loves what he does.

he has a rare skill that is needed, but the "bean counters" don't realize that. we're hoping that they'll hire him back as a consultant.

good pension. the new one is based on a 401K.

so many of the jobs have been sent to india and brazil.

401Ks created the illusion of ownership and social mobility, stripping the working class of what they really need: comfortable security. RIP Pensions.

just because younger people need jobs?

Hell...I thought people work to live, they don't live to work. Maybe I got that wrong. If its the former, and you work until you can retire and have a pensions, well fuck, its time to go build bird houses if you have free time.

I don't know. I guess I don't get it. There are a gazillion things Id do if I had a pension and resources, other than take part in an economic machine that Id only join just to get those things. And pair that sentiment with the notion that some people have no work at all...

I guess its different strokes for different folks. But, its a great time to ask "why do we 'work'?". When is it enough? Are you merely doing it for the activity of the work, not the reward? If so, is there another more enjoyable activity?

Life is an odd thing, ya know. Some just hop on board, and some ask where the fuck its all heading.

loves what he does. he doesn't really have many other interests.

i was the same way. unfortunately i became disabled and had to stop working.

you obviously feel different. many people can't wait to retire.

Im 30, and Ive been trying to retire since I was 15. Other than the money angle, Im doing a damn good job at the lifestyle. Fishing, long walks on the beach, lots of reading, traveling, etc...

Hey, maybe Ill go back to work when I retire.

i liked laying on the beach in the summer. then i found something that i liked doing and all that changed. i worked as much overtime as i could get. i loved what i was doing and the money was great too.

Do you see older employees as being 'in the way'?

I say fuck the new guy, I've been here slaving for most of my life, I don't owe anybody anything.

This encapsulates the Boomer generation like nothing I've heard before.

Wait until some new guy tells your boss to fire YOU from a job you've done for yeards, and give it to him.

You'll find that shoe doesn't fit on the other foot so well.



If you feel others are 'in the way' of your chosen career path, one day they might feel the same about you.

You'll see.

hard working people not like the "ME" generation.

offer consulting services to a competitor.

When people have rare skills they can use them way past 63.

I have a lot of institutional memory in a wide variety of skills at UC. That's why when my entire department was laid off last year I was one of the few who were rehired. I'm almost 62. It really surprised me that they hired me because of my age and because I only wanted a part time job which they weren't offering. They made an exception with me, and they keep trying to get me to work full time with them.

Your husband will probably get hired again or he can work on a part time basis as a consultant.

Rather than December.

And he may have a say in whether he gets his retirement in one lump sum or as monthly amounts over the next how many decades.

He should really talk to a knowledgeable tax adviser - the difference between getting one lump sum or having it spread out over years and years, tax wise, can be (depending on the plan) the difference between keeping yr money or giving it to Uncle Sam.

the monthly sum (an annuity) is much better. it's a crap shoot. the lump sum would work if you think you're going to die young whereas the annuity is for life. he also has the option of lowering his monthly payment so if he dies i get 100% of what he gets for the rest of my life.

So it may have changed) if he gets it as one lump sum and it is not rolled into some other retirement fund, then he may be taxed on the full amount. Which would not be good.

The company decides that it can no longer pay pensions and announces that they're reneging. The courts have been backing them up on this scam. I have a good friend who lost her pension this way. Now, she has nothing.

Sorry for the tough spot your husband is in, but 63 is still young enough to do something new. Maybe if he thinks about it, there is something he always wanted to do--- now is his opportunity!

Good luck, DesertFlower. :hi:

:hi:

If they're shortsighted enough to screw over their employees that way, then maybe they'll make other lousy business decisions that would have a negative effect on their ability to pay him his pension, anyway.

As a self-employed consultant, he could set up his own pension plan from his earnings there. He'd have some creative ways to shield his income from taxes. Meet with a good tax accountant about this, and get some good advice relevant to your situation. Be sure to ask about forming a Subchapter S corporation, he could limit the amount he pays into Social Security, and could still collect Social Security. I used to be enrolled to practice before the Internal Revenue Service, there are still some good tax planning strategies for the self-employed.

I work for the California State University system and have recently become aware of something I choose to call the "art of pension double dipping."

This appears to be a practice of university CEO types: retire from one university after a six figure career, collect pension. Apply for another position (usually a step up to vp) collect six figure salary again. Retire again with another pension, move on to another position (maybe president of another university) with yet another six figure wage package.

My colleagues and I are familiar with people who are on two different pension plans who have ostensibly retired but who are rehired by other colleges. There are apparently no agencies tracking all this. I am not sure what I think of the ethics of all this . . .but it's being done, this retire rehire business. Food for thought Desert FLower! :-(

she worked in texas. she retired with pension and moved to phoenix and works as a school psychologist here. i don't think she would have been able to do that in texas.

'Rollover' his pension funds into an IRA where he could invest in whatever. I've been happy with Schwab. If he rolls it over, he would have no tax consequences. Talk to the Retirement folks at Schwab and see what they say.

There is no way I would want the Company that your husband works for to have any of his money...considering they're being so nasty.

I'd bet they'll hire him back as a Consultant...make sure he charges them a HUGE hourly fee!!!:evilgrin:

This could be a very good thing.

roll over into an IRA.

it can be a good thing. he's working on several big projects now that only he knows how to handle. i'm pretty sure they'll hire him back as a consultant.

and he sets up his own corporation, and they will let him roll over his pension (they probably won't) he can do it into his own corporate pension plan, and even "lend" himself money out of it for a fairly large list of reasons. The money he would pay back as interest to the corporate pension plan would be income, and if it was on a second home, it might be tax deductible!

and if they want him back for his rare skill, the starting point for negotiation of his consultant rate should be 2.5 x his current hourly rate. If his skill is so necessary and rare they'll be glad to pay that.

If they don't want to pay at least 1.5 times his current rate it probably will cost him money to work for them as a consultant because of the self-employment tax and other less obvious costs of being self-employed.

Meanwhile he should spend the next six months figuring out who else would be interested in hiring him either as an employee or on a consultant basis.

It sucks, but it's the way of the corporate world.

that company is paying his company $225 an hour for his time. i think they'd be happy to give him $125 an hour as a consultant.

That example illustrates why 2.5 times current hourly is a good (not greedy, not too expensive) consultant rate.

What we cost as employees is so much more than what we are paid when there are good benefits attached, and as I wrote above our costs as consultants are more than just the wage we'd like to get from working.

Take the pension and if he can stay on as a consultant great. If they are billing $225 they should easily pay him $125 per hour (that is over 40% gm)

To you that would equate to about 250k per year on top of his pension. Setting up an LLC, getting a tax advisor is fairly easy, will cost you about 5k total.

for 41 years (vested?) it seems that surely they couldn’t change the game at this stage.

pension plan those who had been with the company a long time were able to keep the old plan.

but you've got the bean counters. they look at how much the company can save by doing this.

hope everything wonks out.

Or did you want to say, "Move over, old guy!"??

Please.

and stash it somewhere else. the way pensions are being handled nowadays scares me. as mentioned already here, if they ask him back to consult, make sure they pay him plenty for it. and he could also find other places where he can consult. i know you and he will not let him lose his pension but i would not leave it where it is either. jmo.

ellen fl

wake up and smell the roses. Employer loyality left the building many years ago.

used to be one of the best, but all that started changing about 15 years ago.

And as for the "rare skill that is needed", belief. Everyone thinks the place will close up without them. Its a normal human reaction. I never thought that way but I knew a lot of guys who did. And after they retired the place kept running just like they were never there every time.

Good luck and tell your husband to enjoy his retirement. I sure enjoy mine.

Don

to take painting lessons or go back to playing the guitar. i know that he's going to need something.

our dentist is almost 70. his business is down. he's only open 3 days a week. he's having pain in his neck and has been thinking about retiring. his only interest is hiking. he said "if i retire what am i going to do -- walk up and down the street"?

our doctor just gave up his practice. he's almost 79 and in great health.

I do wildlife watching at night after it cools down sometimes with a good spotlight. Watched a Red Fox last night for about ten minutes.

Heck I like going back to my old high school for a basketball game occasionally. Cheap night out and lot of fun.

Been doing a little fishing lately too. Dozen worms and a licence and I had another cheap day.

Don't have to do any one thing until you get sick of it. Switch off. Got any Zoos, Arboretums, Aquariums, or Museums near you? Those can be a blast. Don't cost hardly nothing.

Sometimes I go to the local Greenhouses. Not to buy anything. Just to look at all the different flowers.

Good luck.

Don

to work one day past 62 unless they really needed the money. Myself I worked in a steel mill for nearly 40 years, was exposed to every carcinogen known to exist, went through two bankruptcies, concessions and three strikes totalling about 13 1/2 months. I dispised my job so I really don't know what it would be like to actually like work. I don't know how they could take a vested pension off someone after over 40 years. I don't know if I would trust them with my money, you could take a lump sum and buy an annuity with survivors benefits or a cash payment if he would pass before yourself.

you were well paid.

My monthly health insurance payments ate more than my retirement paid. I started working privately right away. Turns out there were quite a few people waiting for me to leave my state job so I could take on private clients. I am now turning down a whole lot of work because I'm trying to live a balanced life.

Take the money and run.

If he really wants to work then he can consult on his own terms while taking that new unstructured free time to develop some personal interests.

Its a long term health issue too because the day will come when the business world is done with him and he will need a life or the fading sets in and good years of adult freedom are misused or never experienced.

You've got lots of good advice in this thread...

Thanks for the heads-up!

I got an early retirement, no benefits, not much money, but I got my freedom and I revel in it every day!

I have never been happier!

I think you can tell... ;)

Good luck to your husband...and you!

K&R

:hug:

i can tell that you're happy.

:hi:

He should take it. He could then open his own consulting business.

Julie

Taking the pension and working as a consultant is probably the only thing that he can do, but is the company going to pay health care until he's 65? My father could have retired early with 40+ years for the state, but ended up taking a county job for benefits for a couple years. (Plus, he wasn't ready to be retired.)

I think it would worth the cost to talk to a employment lawyer and an accountant prior to retiring.

Health insurance is one of the biggest things that keeps my hubby from retiring at 63. Even then, he's 6 months older than I am, so would probably work an additional year in order for me to catch up with him in eligibility for Medicare.

Hekate

He chose to retire early and it worked out great for him. He did contracting work on the side until his mental/physical health could no longer take it. If your husband is 63 he should consider himself lucky as many companies are insisting upon this at a much earlier age (like folks in their fifties, as was my father). He was a member of the CWA union, btw.

as a temp from '79 to '88. i remember when the bell companies were offering early retirement. a few of my friends took it.

It was pretty controversial even then but he was beginning to show some health problems even that early (although this had nothing to do with it) and we all urged him to just take advantage of it. He's living off the interest from that buyout still, plus his monthly SS.

seek to sell my skills back to them (to train the new kids) or to a competitor.

Take your vested money,talk to an investor. You want control of the money,not some insurance company.

i sure wouldn't risk a 41 yr old pension just to stay in the job market a couple more years -- at 63, you can have an injury at any time that would make it impractical to continue working

if he absolutely wants/needs to keep working, perhaps so that he doesn't have to start collecting social security and can build up that pot higher, i would say get into consulting or else simply find another job

damned few people quit their job loving what they do, it's not all bad that he gets to leave before the bitterness has set in, most jobs suck for most people most of the time

but i wouldn't give up my pension and for all you know, the very next january, an unbearable boss is hired who makes his life hell or some other unforeseeable life event

health and time is not guaranteed in yr 60s, i have many friends who died in their 50s

The problem is, what's to say they just don't cancel the pension plan next?

Defined pensions were something that was negotiated having strong union contracts. When people began using their purchasing power to reward anti-union companies like Honda, Walmart, Toyota, Subaru and others the future for people your age dimmed considerably.

The anti-union companies and the people who rewarded them helped screw your generation and many generations to come.

That's it in a nutshell.

Don

It would allow him to keep his pension and still be able to do what he enjoys. I have an uncle who did this with Alcoa years ago. He's spent more time with them as a contractor than he did as an employee and didn't lose any income.

Just something to investigate..........

if he retires at 63 and can't get on medicare until age 65 then he has a v. dangerous two years as a consultant during which if he gets sick or injured, he has to somehow pay for it himself

not too many insurers are going to take on a 63 year old

the people i know who work as contractors don't get health benefits, they receive higher hourly pay but if they're hurt/injured, they'll lose everything financially

i would look to see what his severance contract looks like, after 41 yrs, i would hope they can keep him on the co. health plan until he's age 65, even if he is just a contractor

if not, he really needs to find not a contract job but a "real" job -- the higher pay of working as a constractor is pretty much wiped out by one hospital stay

i had a close relative thought to be in excellent health who almost died of a heart attack at age 64 so it does happen

6 mos, making it 2 years of COBRA and it the stim package also coverage a portion of the COBRA premium. My husband got laid off from IBM last summer and this is what we learned about the COBRA coverage. It made the COBRA coverage for our whole family actually manageable.

have to pay for it himself. isn't that what COBRA is?

he has to announce his retirement by 12/31/10, but can remain on the job till 6/30/11.

People with real skills who were forced out of jobs because employers don't want to offer health care (or any other kind of benefits) any more. It's rolling the dice to keep food on the table. Good luck.

because of his years of service he and i are eligible for lifetime medical. $217 a month for him or $527 for both of us. they said even if he died, i'd still be eligible for their coverage.

... in today's world. They want cheap, and they don't want to pay for excellence and experience. Salsipuedes -- get out while you can.

My hubby is also 63, so I completely understand your concerns.

Hekate