Posted on 12/06/2005 3:53:47 AM PST by cbkaty
Verizon Communications, the nation's second-largest telephone company, said yesterday that it would freeze the guaranteed pension plan covering 50,000 of its managers and expand their 401(k) plans instead.
In freezing the plan, the company will pay workers the benefits they have already earned but will not let them build additional benefits.
(Excerpt) Read more at nytimes.com ...
I took early retirement from Verizon Yellow Pages in 2002, & it was the best thing I ever did. The poop there is about to hit the fan!
I retired from SBC in 2000. Most of us took the lump sum.... I would not trust them to payout a lifetime of "promissed" pension payments...not at the rate they are losing land lines... Show me the money!
Coming to a business near you.
The company I work for has already taken away pensions from a significant portion of the workforce. The rest of us are waiting for it to happen.
If offered a lump sum...take it.... It is all you may ever see...
Same thing my company did. The pension plan finally ended up taken over by the PBGC. They also increased their 401K match but kept cutting it back.
I'd take a lump sum in a heartbeat. I fear I won't get that offer.
Even with company matching, you must ask yourself -- is it better to forego the matching $1, or manage your money yourself and see if you can better that return, all the while having access to your money anytime, as opposed to hoping/waiting that gains and payout will materialize when you need it.
When I was in the work force, I pretended the pensions didn't exist and chose not to contribute (the boss thought I was weird, but didn't say too much about it).
On the employer-contribution plan, they had a 10-option menu from "cash" to "high-risk" (with a whopping 12-13% return) OR self-managed (discouraged by "counselors" as perhaps just way too risky -- leave it to the professionals).
Self-managed? Whoo-hoo! Multiplied that puppy 8x in 3 years, even with my own mistakes. Oops! Did it without a certificate in finanacial management -- is that legal?
I really feel bad if you have to reply on someone else's financial management acumen for your pension, or on someone else's business acumen, for that matter.
They already have their hands deep in your 401K pocket. Here is how it works:
Roll your 401K into an IRA
Earn interest and capital gains "tax free"
Take money out of your IRA - pay tax at your maximum rate.
There is no free lunch. Taxes collected from IRA withdrawls are a big chunk of the taxable income in this country and they are growing.
Corporate money managers always play "lawyer-ball" in defense of any possible lawsuit....the performance results are mediocre but normally on the plus side.
One can learn to manage one's own account....but everyone takes a loss sometimes....the art is balancing to the win side.
I didn't get much sleep last night.
I read this as:
Vatican to Halt Pension Outlay for Mangers
I'm grabbin' a nap.
I'm not in the communications businessbut see similar things as yourself. I'd take a buyout if offered though.
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