Financial

Independence

Is

Machiavellian War

UPS to Freeze Pensions for 70,000 Workers toReduce Costs

UPS joins companies including DuPont Co. and Lockheed Martin Corp. in freezing pensions, which means that some or all participants may stop accumulating benefits. UPS’s retirement obligations are on top of a $1 billion jump in capital spending being planned for this year to handle a surge in e-commerce shipments.

DYI:  The moral of the story is never become dependent on an old style retirement (defined benefit plans) as they are controlled at a whim by the underlining corporation.  If you are working for one of these mega corporations or as a State employee that still has a defined benefit, just say to yourself “that’s nice,” and plan as if you will never receive a dime (or significantly reduced) as most of these plans are so underfunded that could very well be the case!

Some call this the money game.  I call it Machiavellian War!  No one cares if you lose the war and go from one financial crisis to the next during your working years or live in poverty when working becomes impossible.  To put it bluntly “No one gives a $hit and those that do are unlikely to help.”  You are on your own.  As Boomer’s (attempt) to retire many find this impossible as they continue to work well past age 65 full time and only drift into part time in their early to mid 70’s.  That’s great if you have a job that is so enjoyable you tap dance every morning to work.  But alas we all know that is reserved for a tiny minority and not for the masses.

Millennials

The size of your net worth is inversely proportional to your mortgage (or rent) along with car notes, student loans, and credit card bills.  Simple, larger the debt payments, there is less money or no money for the purchase income producing assets.  As simple as that!

Why the purchase of income producing assets?  If you put money into retirement plans such as 401k, Roth IRA, etc. they are tied up until age 59 ½ however if you purchase items such as utility stocks (not in a pension plan) as an example those dividends can be used to offset many of your basic bills.  Plus, you have additional monies to draw upon when those emergencies that arrive all at the wrong time.

 

First things first.  If you are in debt make that your highest priority to have it paid off and paid off fast.  Too much truck or car, sell it and move down to something more reasonable; same for a house or if you are renting above your means.  Time to get real and stay super motivated. 

Once you are debt free, including the mortgage if you have one, build savings at the one to two year level necessary to pay your bills.  Remember you are debt free so these numbers are not as difficult due to your modest lifestyle.  Then begin buying income producing assets, stocks and bonds to increase your spendable income.  Only after you have established yourself then begin moving dollars into retirement plans.

This is my short version of this process.  I’ve written in the past far more in detail and will again in due course.

 DYI