I'm in big time trouble...

Posted by: Topper

I'm in big time trouble... - 05/11/05 03:36 AM

A bankruptcy judge has decided to allow United Airlines to back out of playing to their worker's pension plans. <br>United Airlines pension plans are underfunded by 9.8 billion dollars.<br>The Pension Benefit Guaranty Corp will now take over the pension plans and the retired United employees will only get a percentage of the pension that United had promised them.<br>The PBGC had warned that United's pension default might tempt other big airlines to file for bankruptcy-court protection and jettison their own pension plans. <br>But the bankruptcy judge is going to let United Airlines walk away from their responsibility. <br><br>What now is to prevent any company from declaring bankruptcy to stop playing into their pension plans?<br>What about your company?<br>Who is going to help the PBGC pay these pensions? The American people, of course. <br><br>I just recently retired from the airline industry. <br>My pension is very small.<br>It is going to be a very big hardship if my pension check gets any smaller.<br>But in light of these developments I've got to believe my airline will declare bankruptcy in order to stop playing into it's pension plans also.<br><br><br><br><br><br><br><br>
Posted by: Bryan

Re: I'm in big time trouble... - 05/11/05 07:57 AM

Man, that sucks. Hope you can still make it. <br><br>I'd expect to see more of this...especially from GM and Ford, who have promised big benefits and retirement to the UAW, and financially they can't meet those obligations. <br><br>It's also an important lesson to younger workers...fund that 401K...and don't invest all of your money in the stock where you work (remember Enron?)<br><br><br><br>
Posted by: iRock

Re: I'm in big time trouble... - 05/11/05 07:58 AM

Bummer. I hope it goes better than you suspect. That's just rotten.<br><br>
Posted by: margadagio

Re: I'm in big time trouble... - 05/11/05 09:27 AM

That sounds scary. I wish you luck!<br><br>
Posted by: mojo_jojo

Re: I'm in big time trouble... - 05/11/05 10:36 AM

I was wondering if United's announcement would affect you. I remember recent posts where you have expressed concern about this very subject. <br><br>I agree that this decision will open the door for other financially troubled airlines to follow United's lead. <br><br>
Posted by: steveg

Re: I'm in big time trouble... - 05/11/05 11:55 AM

Hope there's a favorable resolution for you Clark. Nothing worse than busting your ass for years only to have your future payoff gutted. A couple of years ago I almost accepted an ad agency job in Chicago to run the creative for UAL's direct marketing. But the agency didn't want to pay for relocation, so I didn't go, and I recently learned that the agency is about to close that office because of UAL's predicament. So that's 30+ more people that will be screwed out of an income.<br><br>Good luck, man. <br><br>
Posted by: Topper

Re: I'm in big time trouble... - 05/11/05 01:04 PM

I don't know much about GM and Ford but considering how they are really hurting right now I wonder if they would try to pull-off something like this. That was scary earlier this week when S&P rated their bonds as junk.<br><br>401K...some of the young kids are pretty smart these days. They are investing a good percentage of their income into 401K. The problem here of course is you had better hope that the people who are running the 401K for your company know what they are doing.<br><br>
Posted by: Topper

Re: I'm in big time trouble... - 05/11/05 01:15 PM

Thank you, Steve and mojo_jojo, Marg, Shelli. <br>Yes, this will effect a lot of people not just United Airlines. <br>I feel bad for the 30 people that you are talking about and all the others that are effected.<br>The repercussions will be felt throughout the country.<br><br>
Posted by: skuldugary

Re: I'm in big time trouble... - 05/11/05 01:34 PM

Don't let this worry you. It hasn't happened but you're putting yourself through the stress and worry as if it has happened.<br><br>Your penson has not been effected, right? Yes, it may, but as of today, it hasn't. Enjoy your life. Live in this moment and this day. None of us knows what's going to happen even 5 minutes from now let alone a week, month, or year. <br><br>And if it does happen, what could you have done to stop it? If nothing, then putting yourself through all this worry is for nothing. Our lives are so short and each moment that goes by can't be retrieved or changed once it's gone. Make each one count. <br><br>On the other hand, if you feel strongly that it will happened, you have time to prepare. If that means you can get a part time job, then you're ahead of the game instead of being blindsided. <br><br>Topper, I'm not trying to make light of your situation in any way. I know what it's like to feel like there's some unseen axe over your head and you never know if that thread holding it up will snap or not. Instead, take control of what you can and don't stress over what you can't. <br><br>I hope you find something in this helpful and may give you peace of mind. <br><br>
Posted by: Topper

Re: I'm in big time trouble... - 05/11/05 01:41 PM

Thank you and yes, I agree, I will worry about tomorrow when tomorrow comes.<br><br><br>
Posted by: carp

Re: I'm in big time trouble... - 05/12/05 02:55 AM

Super Bummer.<br><br>However I heard that the Feds will pick up the tab - sorta bail out United pension fund via tax payers dollars <-- I did say heard from 3rd party who was complaining that the tax payer picking up the tab, he felt the money for the pension should come from the Stock Holders.<br><br>
Posted by: Bryan

Re: I'm in big time trouble... - 05/12/05 03:06 AM

Absolutely it should come from the stockholders, as well as any other assets the airline has. <br><br>
Posted by: cesrivas

Re: I'm in big time trouble... - 05/12/05 03:18 AM

<br> ... one more reason to hate Airlines ... they are so over-rated.... :-/<br><br>----<br>:)
Posted by: Topper

Re: I'm in big time trouble... - 05/12/05 03:24 AM

This is probably the way it will play out:<br>United Airlines will give the PBGC 1.5 billion dollars.<br>The PBGC will pay out 5 billion dollars to United Airline employee pension plans.<br>Some (all?) United Airline employees will see a cut in their pension checks.<br>I believe the American tax payer will pick-up 3.5 billion dollars.<br><br>Here is another slap in the face by United Airlines...they are now in the courts trying to get their unions dissolved.<br><br>It will be interesting to see what happens when a lot of other companies tell the PBGC that they don't have the money to pay their pension plans either.<br><br><br>
Posted by: Bryan

Re: I'm in big time trouble... - 05/12/05 03:31 AM

That's the problem with company-provided pensions. What they promise is only as good as the company making the promise. <br><br>The company where I work is an enormous corporation....one of the biggest...but I passed on their pension plan and opted for the 401K. I also don't participate in buying company stock. All for the reason of what you're going through with UAL. <br><br>Hope it works out for you man and you get all or most of what you're owed. <br><br>
Posted by: Topper

Re: I'm in big time trouble... - 05/12/05 03:38 AM

A long time ago working for the airlines was a good job, a respected job. <br>And some of the airlines were very good, very professional.<br>But things change.<br><br><br>
Posted by: Topper

Re: I'm in big time trouble... - 05/12/05 03:40 AM

Thank you, Bryan.<br>401K is smart but make sure you have good people managing it.<br><br>
Posted by: drjohn

Re: I'm in big time trouble... - 05/12/05 03:52 AM

How could it come from the stockholders, even if it wasn't a .99 OTC stock...wothless for all practical purposes? <br><br>
Posted by: carp

Re: I'm in big time trouble... - 05/12/05 05:09 AM

Not sure on how that would work but.<br><br>the 99 cent stock holder would take a hit down to 50 cents per share. The 49 cents would thus go in the pension fund.<br><br>Considering that stock money goes into a "General Account" and not a "Pension Account" = completely different animals any bean counter will tell you that switching money from one account to another is illegal, like Enron funny money.<br><br>Now United is face with the obligation of setting funds aside to meet the expected pension burden in the future. They just don't have the cash.<br><br>401Ks<br>I believe in those only because the company cannot go in and fumble the money.<br>401s at-least give you some choices on where to place yer bets. <br><br>What I would like to see is a 401 that gives you an option to place your pension, where you want it, and not govern by a yahoo who you never met ? I also like to see the Social Security turn all 401 = that will give me the chance to get out of another bankrupt system<br><br>
Posted by: drjohn

Re: I'm in big time trouble... - 05/12/05 06:17 AM

<blockquote><font size=1>In reply to:</font><hr><p>the 99 cent stock holder would take a hit down to 50 cents per share. The 49 cents would thus go in the pension fund.<p><hr></blockquote><p>Huh? When a stock first goes to market is the only time the issuer (corp) gets paid. After that, the stock is traded in the marketplace. If a stock pays no dividend there's nothing the issuer can do to effect a stockholder (other than screw up and drive the stock price down). Which it appears United has done. <br><br>
Posted by: G4Dualie

Re: I'm in big time trouble... - 05/12/05 08:15 AM

As someone who lives on his pension my heart goes out to you man. <br><br>The thought of going back to work at my age is sickening. I think I would take my freelance work a little more seriously if I was faced with the prospect of going back to work.<br><br>I hear what you're saying about respectability in the work place, aviation was a good place to be, good perks, pay, and plenty of opportunities for advancement.<br><br>Hope things work out for you. <br><br>