SWA TA Discussion

[CoffeeIcePapers]

How often are reserves used on a day of work, on a given month?

 

[ZapBrannigan]

How often are reserves used on a day of work, on a given month?

In the summer, 99% of the time. In January or February… maybe 75% of the time, depending on staffing. Your mileage may vary.

 

[ZapBrannigan]

I do have a question though, is that only 2% DC once spillover applies, or what?

No. Even a newhire who doesn’t come close to spill cash, still gets the 18% NEC and the 2% MBCBP contribution.

 

[arkflyr]

So far I’m happy, they have addressed my top items, disability and rig absorbing reroutes. The retirement is great, and I’m satisfied with the pay.

 

[ZapBrannigan]

Over on APC there’s a poll. So far looking 60/30 for ratification. (10% not voting)

 

[ZapBrannigan]

Every pilot opening the retro bonus calculator today for the first time be like…

 

[Richman]

The MBCBP at SWA isn't just for spill cash. By 2026 the company will also be putting 2% in there each year. That brings the total retirement contribution to 20%. Of course we can choose to put spill cash there too.

Also profit sharing is a qualified plan at SWA - if we ever start making a profit again.

There's a good video about how it all works together on the SWAPA YouTube page.

This is a case of "pending IRS approval"

You can't elect variable contributions into a MBCBP. You're either in or out, permanently. Otherwise you're into a thing called "cash or deferred", to which the IRS is highly allergic. You can't change your contributions, nor can you elect to fund it with random bits of cash like profit sharing UNLESS you make a one time election to do so (as in, all my profit sharing forevermore), and then that's it. The IRS will let you stay with the current setup because the "status quo" is changing, but once you pick one or the other, that's it.

UAL is in a different place. They don't get "cash over the cap". Their excess goes into their VEBA, so when they get their MBCBP in place, they can elect one or the other on a periodic basis, because it's not cash or deferred, it's deferred or deferred.

 

[Skåning]

 

[T/O w/FSII]

Over on APC there’s a poll. So far looking 60/30 for ratification. (10% not voting)

That’s impressive seeing that is 60/30 haters and complainers on that site


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[Richman]

That’s impressive seeing that is 60/30 haters and complainers on that site


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Don't forget, the FDX TA was like 80/20 against, and it failed by significantly less margin.

 

[ZapBrannigan]

Don't forget, the FDX TA was like 80/20 against, and it failed by significantly less margin.

So you're saying that people are all talk but they'll vote for it anyway?

 

[Crockrocket94]

I have a feeling this will pass. It isn't a mediocre contract like TA1 was in 16.

This has LOTS of gains and even things people don't like are still large gains.

 

[///AMG]

Thanks for the amplifying responses guys. Think you guys would be leading the industry now in employer contributions now, right?

 

[tcco94]

We got our MBCBP this year. It’s basically a place that 401k contributions spill to that is tax sheltered once you hit the 401k max. The returns aren’t stellar, but they cannot go negative. You need to roll it somewhere else when you retire because it’s not a 401k or IRA.

The typical, disgustingly overemotional crowd here was loudly against it. However, speaking strictly for us, you’d you have to make some crazy massive return to beat the tax savings. Nearly anybody who opted out who didn’t already have a very successful outside business is shooting themselves in the face.

YMMV yada yada yada.

I disagree with that statement. And I see both sides here of why would or wouldn’t want to do it - but massive regret from the opt outs is something I haven’t seen. And being a slam dunk that one option is better than the other is kinda comical, imo. Some would rather have that money and could outpace the blackrock investment and tax savings. It’s really not that crazy. Two roads to take. Both equally as good. Unless you’re someone who doesn’t know how to invest and will buy toys with all your money. Which even then, it’s your life anyways so I wouldn’t say anything negative about it.

 

[Autothrust Blue]

We're gonna vote for a MBCBP at our shop. It's gonna pass.


Frankly, at my age, I'd still rather get the spillover cash despite the Fed, state, medicare, and ALPA dues. I have better plans for that money now versus retirement.

What is it that will have a better return, or is this just an extension of the Frivolity Fund? Serious question. I’ve only met one other pilot who actually had a good plan for the excess contributions.

 

[arkflyr]

The only thing so far to give me much heartburn is the implementation timetable, specifically vacation bidding. It's not enough to warrant a no vote but I definitely want to hear why that was kicked to the end given how much angst this causes the bottom 80% of each seat of the pilot group.

In Denver a FO could upgrade before holding summer vacation for Pete's sake.

 

[Autothrust Blue]

So you're saying that people are all talk but they'll vote for it anyway?

They’ll mother-frak their union and their reps and their NC rather vociferously and publicly, make sweet dank and easy-dunk memes, then go into their rooms, close the door and vote yes anyway.

 

[Richman]

I disagree with that statement. And I see both sides here of why would or wouldn’t want to do it - but massive regret from the opt outs is something I haven’t seen. And being a slam dunk that one option is better than the other is kinda comical, imo. Some would rather have that money and could outpace the blackrock investment and tax savings. It’s really not that crazy. Two roads to take. Both equally as good. Unless you’re someone who doesn’t know how to invest and will buy toys with all your money. Which even then, it’s your life anyways so I wouldn’t say anything negative about it.

If you're talking about the DAL plan, its not invested in Blackrock. It's self invested in collective investment trust, although the portfolio is conservative.

 

[tcco94]

If you're talking about the DAL plan, its not invested in Blackrock. It's self invested in collective investment trust, although the portfolio is conservative.

Isn’t the fund matching LIRKX? My comment about giving it to blackrock was not what I meant to say, my mistake there.

 

[Richman]

Isn’t the fund matching LIRKX? My comment about giving it to blackrock was not what I meant to say, my mistake there.

It doens't have to. As long as it tracks the PWA required investment strategy, then it's good. It's similar to LIRKX, but doesn't have to be exactly, and the fund manager is free to adjust the details within the bounds of the required strategy. The benefit is you don't have to spend the money for the fund, and by doing a "roll your own" inside a collective investment trust, the expense ratio is significantly lower than an actual retail fund.