Was at UP in a manager roll for 17 years, 11 them on UP Pension with salary between 96k and 108K. Got a packet in the mail with an offer for a buyout of 61K to an IRA. Lowball offer.
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When I worked at UPRR, they always offered generous buy-out plans based on years of service when downsizing. Then if they didn't get enough buy-outs they offered generous severance payments one month's pay for each year of service or more, plus health insurance. After the MP merger, they cut about one third of the employees in a year or two, but all through voluntary buy-outs! !00%! Downsizings are nothing new.
The UP pension is the "Harriman" pension. On your w2 forms it is RRIII. They buy out is specifically for the "Harriman" pension not your federal railroad retirement pension tiers I & II. The railroad has no say in a buy out of the tiers I & II, that would have to come from the feds. Realize that if you take the "buy out" of the Harriman package, they will tax the living sh-- out of you, unless you roll it over into another retirement account such as an IRA.
My financial advisor said that in most cases you are better off keeping the pension. I haven't received a letter yet but will run the numbers to be sure.
I got a similar offer - almost 10 years, all in a management role, pay when laid off was $105K. They offered me $65K. No way in hell would I accept that offer! Talk to anyone who has opted for a lump sum payment in lieu of their pension and ask how that worked out for them. UP would love for u to take that’s offer. Obviously the other posters on here are the man.
Not sure how UP Pension is works. But if it works like other pensions, the calculation is frozen when you get canned and some cases never adjusted for inflation. So if your calculation is based on your pay in 2019 and you take payments 20 years later, in 2039 that amount will barely pay your electric bill. On the other hand, if you took the buyout in 2019 and invested wisely over next 20 years, chances are you would be better off.
The UP pension is an entitled benefit that was a portion on my compensation when working for UP. I’m going to take any step to I can to maximize that benefit. Making irrational, emotional decisions isn’t go to do any good. I am posting to see if anyone else has received this packet yet.
Think about how many have lost their jobs WITHOUT any type of buy out or compensation other than the sh#tty unemployment. Take the money and run. Find a corporation that values employees. Im still employed but i see the writing on the wall how this place is being run into the ground for a get rich quick and jump ship by the top tier folks. GET OUT and take the money.
Happy for you to get a buyout offer. If you save the $ in a GNMA or US Treasury bond fund the interest earned there is a lot of money. Many others have been sent home with no buy out offer.