NY Teamsters pensions are evaporating

I know some of you would like to give the Matt Serra gif to the teamsters and the pensioners but this sucks for the people involved.

I am starting to read more and more about pensions failing and I wonder if mine will be next. I have a plan B but it isnt as good as plan A, plan C is even shittier.

In the backseat of his beat-up car, Tim Chmil stashes what he refers to as his new retirement fund — bags and bags of recyclable bottles and cans.

Every time he spots a bottle on the street, he bends down to pick it up.

“Even if it’s just 5 cents, it’s money, and I need it,” the 71-year-old said.


It’s not the way the ex-trucker — a member of Teamsters Local 707 — expected to fund his senior years.

Local 707's once booming pension fund runs out of money
Chmil is one of roughly 4,000 retired Teamsters across New York State suffering a fate that could soon hit millions of working-class Americans — the loss of their union pensions.

Teamsters Local 707’s pension fund is the first to officially bottom out financially — which happened this month.

“I had a union job for 30 years,” Chmil said. “We had collectively bargained contracts that promised us a pension. I paid into it with every paycheck. Everyone told us, ‘Don’t worry, you have a union job, your pension is guaranteed.’ Well, so much for that.”


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Retirees from Teamsters Local 707 had their monthly pension payments cut in half under the 2014 MERPA law - photographed at the GoodFellas Diner in Maspeth, Queens on Wednesday February 22, 2017 - (Susan Watts/New York Daily News)
(SUSAN WATTS/NEW YORK DAILY NEWS)
Ray Narvaez - Retirees from Teamsters Local 707 had their monthly pension payments cut in half under the 2014 MERPA law - photographed at the GoodFellas Diner in Maspeth, Queens on Wednesday February 22, 2017 - (Susan Watts/New York Daily News)
(SUSAN WATTS/NEW YORK DAILY NEWS)
Narvaez received a certificate when he retired that guaranteed his lifetime pension, but last year, he and 4,000 others were informed their checks would be slashed.
Also on the brink of drying up are the pensions for two Teamster locals — 641 and 560 — in New Jersey, union officials said. Plus 35,000 Teamster members upstate who are part of the money-hemorrhaging New York State Teamsters Pension Fund.

N.Y.’s democracy needs an overhaul
Bigger than all of New York’s Teamster locals combined is the Central States Pension Fund — another looming financial disaster that could leave 407,000 retirees without pensions across the Midwest and South.

And there’s still more beyond that, in various industries, officials say.

“It’s a nightmare, it has just devastated all of our lives. I’ve gone from having $48,000 a year to less than half that,” said Chmil, one of five Local 707 retirees who agreed to share their stories with the Daily News last week.

“I don’t want other people to have to go through this. We need everyone to wake up and do something; that’s why we’re talking,” said Ray Narvaez.

Narvaez, 77, got a union certificate upon retirement in 2003 that guaranteed him a lifetime pension of $3,479 a month.

Teamsters Local 707's pension fund is the first to officially bottom out.
Teamsters Local 707's pension fund is the first to officially bottom out. (DAVID WEXLER/FOR NEW YORK DAILY NEWS)
The former short-haul trucker — who carried local freight around the city — started hearing talk in 2008 of sinking finances in his union’s pension fund.

But the monthly checks still came — including a bonus “13th check” mailed from the union without fail every Dec. 15.

Then Narvaez, like 4,000 other retired Teamster truckers, got a letter from Local 707 in February of last year.

It said monthly pensions had to be slashed by more than a third. It was an emergency move to try to keep the dying fund solvent. That dropped Narvaez from nearly $3,500 to about $2,000.

“They said they were running out of money, that there could be no more in the pension fund, so we had to take the cut,” said Narvaez, whose wife was recently diagnosed with cancer.


The stopgap measure didn’t work — and after years of dangling over the precipice, Local 707’s pension fund fell off the financial cliff this month. With no money left, it turned to Pension Benefit Guaranty Corp., a government insurance company that covers pension.

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Hernandez, Petrone and Acosta have had to restructure their retired lives around the devastating cuts, (SUSAN WATTS/NEW YORK DAILY NEWS)
Pension Benefit Guaranty Corp. picked up Local 707’s retiree payouts — but the maximum benefit it gives a year is roughly $12,000, for workers who racked up at least 30 years. For those with less time on the job, the payouts are smaller.

Narvaez now gets $1,170 a month — before taxes.

Ex-trucker Edward Hernandez, 67, went from $2,422 a month to $1,465 last year. As of this month, his gross check is $902. After federal taxes, it’s $721 — but he still has to pay state and city taxes.

“We have guys on Long Island who are losing their houses, the taxes are so high out there,” Hernandez said.

Milton Acosta, 75, was a dockworker in Local 707. He retired at age 62, figuring his union pension of $2,300, coupled with his Social Security, would keep him and his wife afloat.

Now his pension is $760 a month after taxes, he said.

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Hernandez, 67, noted that former colleagues on Long Island "are losing their houses." (SUSAN WATTS/NEW YORK DAILY NEWS)
“I pay $13,000 a year in property taxes alone. My mortgage is $2,300 a month,” Acosta said.

He and his wife share the home with their 50-year-old son, a general contractor who is often without work; the son’s wife; their three kids, and the Acostas’ 53-year-old daughter.

“I had to declare bankruptcy when this happened because I had too much credit card debt. It was that or lose our home,” Acosta said.

Ted Petrone, 74, saves money living in a basement apartment below his son and daughter-in-law.

“It’s very isolating. You can’t spend money on anything — now entertainment is going for a long walk,” Petrone said.

Like Chmil, the retirees find themselves doing things to stretch their savings that they never imagined. Skipping meals, holding off on doctor appointments and skimping on medicines are now commonplace, the ex-truckers said.

WAAAAAAAAAAAAA

 

This is the reality that most of us will face sooner or later.

I'm taking a bullet in the head once reach that bridge

I really think the Fed has fucked pensions with the ZIRP. How the fuck do you sustain the thing with no intrest many pensions depend on an 8% annual return on investments. Im sure there may have been mismanagement too in this case.

This blows. A promise is a promise until reality sets in. I don't know who besides the government gives pensions these days, but don't believe them.

If these guys in the article are like most of the Teamsters I know, they make Passive Jay look like he had the financial acumen of Warren Buffett

That sucks for the retirees. Teamsters sucks docnkey balls. How soon before they come to the taxpayers to bail them out???

How does this happen? Are the funds not guarenteed? This doesn't make sense to me. Someone explain.

Yeah it sucks...but weren't they paid very well when they worked ?...wtf did they do with their money ?

Dougie - 


How does this happen? Are the funds not guarenteed? This doesn't make sense to me. Someone explain.


think of SS, people pay in and people take out, now more and more are taking out and less putting in. Also, many investments made by the union fund are based on interest rates which are currently very low so the fund is taking in less returns.

There's really no such thing as guaranteed in this world, as far as money goes. Who guarantees them? the gov't? they're all going broke at an alarming rate. Insurance companies? They make many investments based on interest rates as well, low interest rate returns again means not enough money to pay people.

One of the reason 401k type retirements have become so popular is that YOU control what invest in. The people in this article allowed other to manage their money and now are getting screwed.

Tim Duncan - I really think the Fed has fucked pensions with the ZIRP. How the fuck do you sustain the thing with no intrest many pensions depend on an 8% annual return on investments. Im sure there may have been mismanagement too in this case.


I don't understand...you are suggesting that the Fed spike interest rates in an attempt to save pensions?

Z NEDCMK1 - 
Tim Duncan - I really think the Fed has fucked pensions with the ZIRP. How the fuck do you sustain the thing with no intrest many pensions depend on an 8% annual return on investments. Im sure there may have been mismanagement too in this case.


LOL, you will blame the FED for a rainy Sunday afternoon.



Central States is collapsing because changes within the industry left their pension plans unsustainable, or you could say the ponzi collapsed as retirees began pacing to outnumber actual workers.



This star tribune does a good example of it, although he sugar coats the "ponziness" of it.



http://www.startribune.com/schafer-why-the-central-states-pension-fund-is-doomed-to-fail/381592571/



The issue sin the Teamster funds has very little to do with the rate of returns or costs of the investments. It is a money in v. money out scenario.



 


One of the funds profiled (Teamsters 707) is a good example of the cash in/out problem:

"The fund began to topple, with roughly 700 workers paying into a fund supporting more than 4,000 retirees. Local 707’s fund pays out $48 million a year — and takes in $7.5 million in contributions, McCaffrey said."

http://www.nydailynews.com/new-york/teamsters-local-707-booming-pension-fund-runs-cash-article-1.2982433

Fuck em unions are a fucking joke and tenure needs to be erased. Many unqualified, lazy workers plugging up opportunities for younger, driven people due to these stupid antiquated unions.

Sad. This is why it's essential for union members to attend meetings, be aware of the internal processes, and vote in the best people for these major responsibilities.

Z NEDCMK1 - 
IronHands - Sad. This is why it's essential for union members to attend meetings, be aware of the internal processes, and vote in the best people for these major responsibilities.


That doesn't resolve the issue of firms moving away from union labor for more competetive labor. You could get all 700 members to go to the meeting, but they still can't support 4k retirees.



 


true but they could insist that the president and other officers take pay cuts to help offset some of expenditures. Although in the 707s case the president makes 100k and change which isn't whole lot compared to other union bosses.

Z NEDCMK1 -
IronHands - Sad. This is why it's essential for union members to attend meetings, be aware of the internal processes, and vote in the best people for these major responsibilities.


That doesn't resolve the issue of firms moving away from union labor for more competetive labor. You could get all 700 members to go to the meeting, but they still can't support 4k retirees.



 

That depends on the Union. Especially in our area. In the city, all contractors have to pay prevailing wage for any type of public contract. You won't see scab outfits on almost any job of note. The labor unions are well run, and and most have both pension and annuity funds.

My industry is 100% Union. We are covered by perhaps the best run government program there ever was. Railroad Retirement. It scares the shit out of Congress, because it proves privatization of Social Security can work. In other words, they can't be used as a slush fund. That's why they keep trying to take it from us. Liquidity is absolutely amazing.

GucciGucciGucci - Yeah it sucks...but weren't they paid very well when they worked ?...wtf did they do with their money ?


The ones I know are paid very well.



The problem is (as I'm sure it was with the guys mentioned it the article) is that other than their pension funds, they don't save much. They tend to live above their means.



 

Dougie -


How does this happen? Are the funds not guarenteed? This doesn't make sense to me. Someone explain.

On one hand you have fewer people paying in to support it like a pyramid scheme.

On the other hand you have payouts with the unions that were negotiated in the booming 80's, so they were calculated with large rates of returns that are unheard of in today's market. So making significantly less on the pensions invested, but still having the pay out the previously negotiated amounts, means significantly less funds in the accounts to generate more funds from.

Neither of the above is good, so the fund starts running dry

Never_rolled -
IronHands - Sad. This is why it's essential for union members to attend meetings, be aware of the internal processes, and vote in the best people for these major responsibilities.

Attending meetings and voting aren't going to fix this problem. They are taking in less then is going out.

As a union member and official for my entire post-military career, I wholeheartedly disagree.

I didn't realize that the pensions for Teamsters are local and not national.