Any employee hired by RBC after yesterday will not be eligible for their defined benefit plan. Looks like governments will be the only ones offering DB pensions because they have unlimited taxing power. We exist to serve the public sector employees.
The NORTEL pensioners took a 40% haircut on their pension. Public sector workers will do ok though. How many people work in the broader public sector? I imagine a lot.Basically anyone who has a DB pension plan will in the long run, have a nasty surprise.
Are you sure you are not referring to a defined contribution plan rather than a defined benefit plan for the nasty surprise?Basically anyone who has a DB pension plan will in the long run, have a nasty surprise. These are all built on the premise of average equity gains of 7-8% over time. This assumption is based barely more then 70-80 years of data.. which means it is really a based on FUCK ALL.
I remember when people with DB plans were complaining very very loudly that their pensions were terrible and those in DC plans were getting rich. Just roll the clock back a few years and this was the case. Many with DC plans came out a way ahead - some retirees were able to buy annuities that were 2 or 3 times that of those stuck in DB plans.Are you sure you are not referring to a defined contribution plan rather than a defined benefit plan for the nasty surprise?
Correct me if I am wrong, but with a defined contribution plan, the employee bears the risk the return is below the 7-8% average
With a defined benefit plan the employee will receive a defined benefit and the employer bears the risk of a below average return
RBC like a lot of employers is off-loading the market risk onto the new employees.
Of course, many of those plans were underfunded (GM, Air Canada, NORTEL, etc.)...why would any business want to take the risk themselves by guaranteeing pension amounts...
Well, I worked for one company (private sector) for over 4 years and was able to transfer my pension (mostly defined benefit, with a small additional defined contribution component) to a locked-in RRSP account, and I have a separate defined contribution plan with my current employer. I'm sure if I leave to pursue new opportunities, I will only go to companies that offer some form of pension plan.Other than public sector employees, does anyone still work long enough for a company to qualify for a pension, any pension?
Did you make contributions to the plan?Well, I worked for one company (private sector) for over 4 years and was able to transfer my pension (mostly defined benefit, with a small additonal defined contribution component) to a locked-in RRSP account,
Yes I did, but every contribution I made was matched 110% by the company.Did you make contributions to the plan?
This takes effect jan 2012Any employee hired by RBC after yesterday will not be eligible for their defined benefit plan. Looks like governments will be the only ones offering DB pensions because they have unlimited taxing power. We exist to serve the public sector employees.