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It's mostly downsizing, not retirement packages. Note what Ian said... he waited for a re-structuring and likely raised his hand in interest. There is no guarantee these things come. Have to be in the right place at the right time. Companies find that those who are around 55 love to take downsizing packages, so they are the easy employees to pick and not have unhappy disgruntled former employees, and those with debt burdens. Also gets rid of higher paid employees too.
My friends work just did this recently for the main reason of moving along higher paid employees, those that have been at their job for 30+ years.
 

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Discussion Starter #102
Personally, I could never do what you are doing, a precise 5 year countdown to retirement. It would kill me marking off the months. Are you being too rigid and precise with how you are managing your progress, and too rigid about when and where and how you will sign off? Per your comment are you really enjoying this journey in this fashion?
I have some soft rationale behind the date I chose. If I hit it, it's kind of the cherry on top. It also potentially aligns with some of my stretch financial goals if the markets cooperate.
If I'm busy at work and the projects are going well, time flies and it's a less painful wait. When things are going to hell, that's when the countdown seems like it's taking forever.

What's a package? Where I work, they just tell people to scram.

What is the rationale for offering things like packages to retiring employees? Is it done out of niceness or is there another reason for it? I'd like to understand... and can you point me to the kinds of companies that offer these, preferably with a DB?

Crown corporations come to mind.
Basically what AR said but my company is not really downsizing but restructuring.
They seems to be constantly letting people go annually in weaker parts of the business to keep operational costs down yet still hiring in growing parts of the business to deploy staff with the right skillset where it needs it. Staff in their 50's also seem to have the biggest targets on their back with higher salaries, more benefits, vacation time, etc. I think my company's exit packages are a balance of wanting to do what's right/fair and limiting the potential of getting hit with a wrongful dismissal suit.

In my case, teams are sometimes given a number to hit so sometimes it's psychologically easier for the management team to off someone that has hinted that they are wanting to go. It probably doesn't hurt to have a good relationship with your manager either. And I'll be just into my 50's. But it's all kind of hypothetical at this point.
 

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What's a package? Where I work, they just tell people to scram.

What is the rationale for offering things like packages to retiring employees? Is it done out of niceness or is there another reason for it?
LoL ... done out of niceness?

Most packages I know about were for downsizing so it had nothing to do with retirement - unless you consider no longer being employed as "retired".

The insurance company offered packages when they screwed up a firing. For example the new CEO specially mandated a new head of HR then fired her three months later for "no implementing changes fast enough" where the road blocks were the board or legislation.

They also offered an employee that had a heart attack on the job as package as he was declared "redundant", which might have fit the early retirement except they messed it up. The "redundant" employee's job was posted as well as published in the local newspaper's classified with a different title but the same roles/responsibilities/reports making it clear they simply didn't want to deal with the health issues the manager had caused. The company had to beef up the package substantially when the lawyers came to an agreement.

Once in a while, they'd offer a reasonable package to someone who was genuinely redundant.


A friend of the family didn't want to take the package that included any sort of job training he wanted (to a max fee), two years of a career counsellor to help find a new job, waiving the DB pension early retirement reductions etc. Dad went through the numbers with him and convinced him to take the package. Not enough people did so those downsized received the run of the mill severance, the career counsellor for less time and none of the training/waiving of the DB pension early retirement reductions. This is one of the few "retirement" packages I can recall.


Other companies have brought an employee back part way through a training course to fire them for cause where it was really a new manager that had it in for the employee. The package was added when the lawyers came to terms.

My current company has combined jobs to need one person instead of two so that the person moving on was given a package over and above the severance etc. that an employee who quit or was fired would get.



Where the package was offered in good faith, it was about shedding employees either because they were no longer needed or to open up positions for younger employees who were at risk of being poached by competitors.



... I'd like to understand... and can you point me to the kinds of companies that offer these, preferably with a DB?

Crown corporations come to mind.
LoL ... you seem to have a fixation with gov't and crown corps.

None of the companies mentioned above were gov't or crown corporations ... there were mostly private companies (mutually owned insurance, accounting firm) with some publicly traded (telecom,insurance, software development).

Some had DB pensions, some had DC pensions and some had only a Group RRSP with a % matching by the employer so there is really nothing to point to.


As long as it is a reasonably sized corporation - there have usually been packages for mistakes or restructuring.


Cheers
 

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Thanks Eclectic12 and others, this is helpful background information. I didn't realize this was tied in with downsizing or restructuring.

More broadly, I'm trying to figure out what kinds of companies or sectors might have good, stable jobs and perhaps some kind of pension. I keep bringing up crown corps because some of my friends work at power utilities (BC Hydro, MB Hydro etc) and these are the only people I know who have any kind of job stability plus pensions.

Everyone else I know has to switch jobs every 3 to 5 years, with no job stability, no pension.

Looking at the Money Diaries section I see a theme. It seems like most of the people who are very well off, with high net worths, have some kind of serious pension. This leaves me wondering where I can find such employment.
 

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More broadly, I'm trying to figure out what kinds of companies or sectors might have good, stable jobs and perhaps some kind of pension. I keep bringing up crown corps because some of my friends work at power utilities (BC Hydro, MB Hydro etc) and these are the only people I know who have any kind of job stability plus pensions.

It seems like most of the people who are very well off, with high net worths, have some kind of serious pension. This leaves me wondering where I can find such employment.
jaaaames - this is the ghost of oil jobs calling. Think where you could be right now. it's not tooooo laaaaaaateeeee


Come to sunny Alberta and get the pension you covet so much.

Actually - The pension is a decent part of compensation to be sure, but it's not all that compared to high wages.
 

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Looking at the Money Diaries section I see a theme. It seems like most of the people who are very well off, with high net worths, have some kind of serious pension. This leaves me wondering where I can find such employment.
Look at it the other way around. Certain publicly traded companies in my day, usually blue chips, strove to hire the right people most of the time that would be workhorses, e.g. Clydesdales, and they had to offer a combination of salary, benefits and pension to get them in a competitive environment. For professionals in the corp I worked for, they'd look for top 10% of graduating class and a solid pre-grad work history and have high expectations. So did their competition. I had finished 2nd in my graduating class of 80 engineers and had a summer track record of 84 hour weeks constructing large diameter pipeline, building a material balance program for a gas processing plant, etc. It all added to my marketability.

Another key criteria, it helps to be employed by the company that is the client. I would have never wanted to work in an EPC firm given their ups and downs and such. Much better to be the customer squeezing the contractor.

I would suggest many such folks now in the Money Diaries are either old geezers like me that slugged it out like a Clydesdale, or had both skill and luck (and in many cases a network), in landing these jobs. Without a spouse in equivalent earning power, it is not very likely one could get to that net worth without some kind of management position and probably stock options. That said, there are many roads to Rome, including working for the right growth company by chance or by design.

These days, it is mostly the Crown public service, maybe including crown corporations, who still offer DB pensions. Also the banks and some remaining blue chips which can be googled. Hard to break in most of the time unless starting with them young. Both of my sons were lucky in breaking into the banking industry in their late '20s. I think they are both in DB pension plans but I have not asked.
 

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Every department at the large company I work for has a pension, mostly DC now though. I got lucky to be on a DB Plan, but it was nearly a decade of low pay at other companies with no guarantees of anything better. It’s a good pension, but it’s not indexed and there is always the possibility of the plan being wound up. So I invest on my own and I’ll see how I sit in 30 years.

Seems DB pensions are pretty rare these days.
 

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Thanks Eclectic12 and others, this is helpful background information. I didn't realize this was tied in with downsizing or restructuring ...
Making room for younger employees is the closet I can think of for packages being related to retirement. Most of the time, if those close to retirement age are being offered, it has usually meant the decision had already been made that fewer employees were needed. After that decision was made, it is only a question of whether management says go with those affected that are redundant or whether they see opportunities to make room for younger and typically cheaper employees by targeting those employees close to the retirement finish line, say two year out.


... More broadly, I'm trying to figure out what kinds of companies or sectors might have good, stable jobs and perhaps some kind of pension. I keep bringing up crown corps because some of my friends work at power utilities (BC Hydro, MB Hydro etc) and these are the only people I know who have any kind of job stability plus pensions.

Everyone else I know has to switch jobs every 3 to 5 years, with no job stability, no pension ...
TD bank rolled out a new no employee contribution DB pension in about 2007. If I recall correctly, one of my co-workers from IT consulting days that last I looked at LinkedIn has now been there around sixteen years or so.

I'd have to check if my former employer insurance company offers a pension but for the software I supported plus being willing to travel means a 38% pay increase, before adding in annual bonus money.

The accounting firm merged with another accounting firm so that those being hired after me did not have a pension until they hit the manager level. The flip side of the coin is that a couple of years ago they were desperate for Workday consultants so if you were hired, the starting wage was $110K. Those who had a financial background who knew how to market themselves were being poached for approaching double the pay. Unlike when I worked for them, the lions share is telework from home instead of the weekly flights to the client site that I had.

The Gartner conference in Dec was listing cloud security types as being something over a 10% shortage versus the hiring needs.

Some companies I have seen references to pensions for ... Enbridge, ESIT Advanced Solutions, Ellis-Don, KPMG, the Canadian Medical Association and then the usual suspect of Federal/Provincial/crown corp as well as banks. There was a gov't link that listed the company pension plans by name/company but I don't believe it distinguished between the plans that were closed to new employees versus those that were active.


The only way I have seen stability is by marketing oneself, keeping one's skills up to date and keeping one's pulse on the company. All companies I have worked for and that my friends have worked for have walked people out the door for many different reasons ... sometimes shutting the experiment that was a quarter of the company.


Cheers
 

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Great food for thought cainvest, peterk, AltaRed, thanks... will digest and think about all this.
I dunno what you do exactly but there's certainly a segment up here in FM for automation-type computer/electrical/process engineering work. At a big-oil co. you'd probably come in at 150k salary the very first year and be easily at 200k+ after 3 years. Houses are cheap, too.
 

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I dunno what you do exactly but there's certainly a segment up here in FM for automation-type computer/electrical/process engineering work. At a big-oil co. you'd probably come in at 150k salary the very first year and be easily at 200k+ after 3 years. Houses are cheap, too.
Thanks peterk, but I don't think the oil & gas sector is my kind of scene. However, I am considering moving to Calgary (one city in my list).

I'm looking forward to exiting the US and simplifying my taxes & investments. I will be reunited with my TFSA, which I haven't been able to use while south of the border. I will instantly gain a 70K tax shelter! In addition to that I have 60K of RRSP contribution room.
 

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Discussion Starter #113
End Of April 2019 Update

Savings and Investments
My investable assets: $1.540M. Up about $32.0k for the month.
Her investable assets (excluding DB pension): $449k. Up about $11.6k for the month.
Combined investable assets: $1.990M. Up about $43.6k for the month.

The trend continues with another positive month.
My portfolio had gains across the board except the savings column. Cash savings took a small hit due to April being a heavy spend month from annual bills and having to pay income taxes. It will take another hit in May from my RRSP contribution for the year.
The missus’ portfolio gains were pretty identical to last month, nearly replicating the performance. Her savings though, compared to mine, grew since she had less taxes to pay.

Spending
March Spend: $3160 (corrected due to a missed spend)
April Spend: $6030
YTD Spend: $16730

April’s spend estimate was off by about $750-1000. It was due to combination of up front payments of some travel spends and some unexpected entertainment costs which we really enjoyed. I think we’re still generally trending towards an annual spend of about $50k but there's a good chance of us going above due to some repairs we're forecasting.
I didn’t include our income tax payments in our April spend. My tax bill was slightly less than expected but I am anticipating it increasing annually due to the dividends growing in my non-taxable account.

In the past, May has been both a heavy and light spend month depending on if we travel in shoulder season and how big of a trip it is. I’m going to estimate a $3000 spend for May but wouldn’t be surprised if it bumped up to $4000 if we need to book some more trip expenses. The weather is getting nicer too so there's more events and activities happening which will also end up having us spending a few extra dollars for fun.

Comments, Concerns, and Issues
Work is getting a bit crazy.
Side business is still completely being neglected.
The 3 year mark of my countdown came and went and it was kind of anti-climatic.

Countdown to Retirement
35.5 months to go.
 

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milhouse,

What is your portfolio design ? This close to retirement are you heavy bonds or are you still a risk taker ??
 

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Discussion Starter #115
milhouse,

What is your portfolio design ? This close to retirement are you heavy bonds or are you still a risk taker ??
I suppose based on equity allocation, still a risk taker.
My portfolio looks roughly as follows:
  • Non Registered: ~95% Canadian Dividend Growers with a couple of oddballs. The plan is to grow the yield to $50k/year by retirement and then either let it grow organically or continually trim and reallocate to maintain it at $50k/year.
  • RRSP: ~80% US, EAFE, and EM index ETF's, ~20% bond ETF, and a bit of cash from the yields. The plan is to get the bond percentage up to about 30%. The cash and this year's purchase will be going to the bond ETF but that will only get my about halfway there to about 25%. I'll likely have to do a rebalance.
  • TFSA: ~73% US, EAFE, and EM index ETF's, ~18% bond ETF, ~8% TD stock, and a bit of cash from the yield. The plan was to mirror the RRSP allocation but after TD got beaten down over December, I kind of wanted to use my 2019 contribution to purchase it. Obviously too much Canadian content though and going off strategy. I'm kind of considering different ideas on what to do with the TFSA account but with the understanding that getting too fancy is one of the deadly sins of investing.
  • DC Pension: ~74% US and International Index funds and ~26% Bond Index fund. I'm trying to get the bond allocation up to about 30% too with new contributions going solely to the bond fund.

Hopefully, the dividends from the Non-Registered component will provide a consistent base and the withdraws from the RRSP and DC Pension supplying variable resources for stretch goals. I'm thinking of using the TFSA for unexpected spends somehow.

The missus' portfolio is all over the place and she won't let me consolidate it.
  • Non-Registered: 100% equity with a mix of global, EM, and Canadian Dividend funds.
  • RRSP: ~20% global equity fund, ~5% dividend fund, ~5% balanced fund, and ~70% bond fund.
  • TFSA: ~30% US equity and index funds, ~60% balanced fund, and ~10% bond fund.
  • (Plus her DB pension.)
 

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Discussion Starter #116
End of May 2019 Update

Savings and Investments
My investable assets: $1.525M. Down about $15.2k for the month.
Her investable assets (excluding DB pension): $440k. Down about $9.4k for the month.
Combined investable assets: $1.965M. Down about $24.6k for the month.

The streak is broken. First down month after four up to start the year. Not the longest streak in terms of consecutive months since I've been keeping tracking monthly snapshots in 2013 but definitely the biggest gain.
Broad parts of my overall portfolio felt the impact of the trade wars/tariffs. However, my non-registered portfolio was able to slightly stay in the green. Cash savings went down again due to my 2019 RRSP contribution. It all went into ZAG to try to get my FI allocation in my RRSP up to 30%.
The missus’ portfolio took a hit across the board too except she was able to continue to grow her cash savings. She contributes to her RRSP monthly and even at that, she can't contribute very much because of her DB pension adjustment. To state the obvious, the majority of her drop came from her equity heavy non-registered holdings while her bond fund heavy RRSP was actually pretty stable, dropping less than 1%.

Spending
May Spend: $3490
YTD Spend: $20220

We ended up spending about $500 over the low end of my May estimate. This was primarily due to one of the repairs/replacements I was kind of expecting, actually being done. There were also some travel related spends. Not too surprised with our May spend.

June is going to be a heavy spend month mainly due to a lot of travel related expenses. Going to estimate an $8000 spend for the month. While that extrapolates to a full year spend above our soft target of $50k, our spend in the second half of the year will likely be less.

Comments, Concerns, and Issues
Work is definitely very busy right now. Hoping things take a bit of a breather during the summer when a lot of staff take time off.
Side business continues to be neglected.
I realize it’s just financial pr0n but the financial discussions in the media seem to be all over the place right now: impact of the trade war and tariffs, recession in 2020, inverted yield curve talk, issues with the big 5 banks... I'm trying to tune out the day to day noise but I am curious what the 12 months brings.

Countdown to Retirement
34.5 months to go.
 

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I realize it’s just financial pr0n but the financial discussions in the media seem to be all over the place right now: impact of the trade war and tariffs, recession in 2020, inverted yield curve talk, issues with the big 5 banks... I'm trying to tune out the day to day noise but I am curious what the 12 months brings.
Much of it likely depends on how far Trump goes with his tariff and trade wars, and now tying immigration in with trade. The guy is a nutcase for sure gambling that countries will cave at least somewhat to his rhetoric. His tactics are getting familiar. Go for the sensationalist jugular, back off to slit wrists and claim a win for his base. Trouble is that his behaviour is keeping business investment on the back burner and disrupting supply chains. A recession is not out of the question if he pushes too far, and that will be his proverbial loss come 2020 elections.
 

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Discussion Starter #118
End of June 2019 Update and Midyear Status

Savings and Investments
My investable assets: $1.522M. Down about $2.9k for the month.
Her investable assets (excluding DB pension): $446k. Up about $6.6k for the month.
Combined investable assets: $1.968M. oilkoUp about $3.7k for the month.

While it’s the second down month in a row for me, the bigger picture is not so bad. My non-registered dividend portfolio took a bit of a hit this month, in minor part due to a number of stocks going ex-div. However, the rest of my registered index focused portfolio (RRSP, DC Pension, and TFSA) had reasonable gains. The missus’ portfolio had gains across the board other than savings going down a bit due to a heavy spend month. Also on a positive, the slightly strengthening loonie has increased the value of our portfolios in USD terms.

My Portfolio2018 Actuals2019 to end of Q22019 TargetsRetirement Goals (Rough)
Cash (soft target)20.2k14.5k20k30k
Non-Registered689k770k761k1.1M
RRSP327k368k351k450k
TFSA82.6k98.1k93.9k135k
DC Pension237k271k253k350k
Total1.356M1.522M1.490M2.065M
Non-Registered Account Dividends30265171003500050000

I revised my 2019 targets downward based on the poor results of 2018 but didn’t update my retirement goals. With the great start to 2019, I've hit my revised 2019 targets and am getting close to being back on track to trending well towards my original retirement number. To be honest, I’d be happy with even just fairly stable/static markets for the rest of the year but would be over the moon if we could grind out a bit more gains.
I’m pretty happy with the dividend results and am pretty confident in hitting 35k in dividends by the end of the year due to increases, DRIP’ing, and additional purchases. While I had a small setback with SNC’s dividend cut earlier this year, the impact to my overall dividend flow was minor as it really isn’t part of my core dividend holdings which are financials, utilities, telecoms, and pipelines.

2018 Actuals2019 End of Q22019 Targets
Combined Totals1.753M1.968M1.941M

Spending
June Spend: $5870
YTD Spend: $26090

While June was a heavy spend month primarily due to travel related expenses, it wasn’t as high as I was expected as we were able to keep purchases in check.

July is going to be another heavy spend due to our second installment of property taxes and some more travel expenses. I estimate it to be about the same as June ~$5500. With the big bills front-loaded to the first half of the year, the rest of the year’s monthly spends, other than December's, should be relatively low; in the $3000 range. However, we’re still keeping an eye on potential repairs so another month may pop up into the $5000+ range.

2018 Actuals2019 end of Q22019 Full Year Trend2019 Original Forecast
Food & Eating Out1185063701275012700
Housing & Utilities1088083701136012500
Transportation4170296038704500
Personal6600288057606000
Entertainment135096016702000
Travel1104067301346012000-18000
Side Business613100200200
Total46500260904907050000-56000

*Full year trend is not necessarily double the first half spend due to large single annual spends in the first half of the year factored in.

Food & Eating Out: Our food and eating out spend is on expected target.

Housing and Utilities: Housing and utilities is kind of under expected spend but we're keeping an eye on potential repairs. Overall, costs (utilities, property taxes, and insurance) keeps going up of course.

Transportation: We’re slightly under estimate due to lower maintenance/repairs and parking costs even though insurance costs went up.

Personal: We’re slightly under estimate here too but suspect we'll be closer to target due to December spends/gift giving.

Entertainment: We're under estimate but higher than last year due to going to a couple of pricey events.

Travel: We’re on spec with our travel spend but it's kind of random if and where we go so it's kind of variable.

Comments, Concerns, and Issues
Work continues to be very busy. No let up likely for the summer.
Side business continues to be neglected. Don’t think this will be changing any time soon.

Countdown to Retirement
33.5 months to go.
 

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Discussion Starter #119
End of July 2019 Update

Savings and Investments
My investable assets: $1.524M. Up about $2.0k for the month.
Her investable assets (excluding DB pension): $451k. Up about $4.4k for the month.
Combined investable assets: $1.975M. Up about $6.5k for the month. (rounding)

Although most of the month was showing some reasonable gains, it ended up being a pretty flat month for me across the board. The small pullback in the US markets after the small Fed rate cut on the 31st obviously didn't help. It was nice seeing the S&P breaking 3000 for the first time during the month though.
The missus' portfolio was pretty flat too with small gains in each category.

Spending
July Spend: $6430
YTD Spend: $32520

July was going to be a heavy spend due to our property tax installment but we were way over my estimate of $5500. This was due to a larger than expected car servicing bill, some repairs/replacements for a couple of things that broke, and some travel costs from a previous trip and future trips.
August should come in under $3000 I'm guessing.

Comments, Concerns, Issues
Been able to exhale at work due to there being a bit of a calm period within my projects.
Read another interesting blog post by Morgan Housel on "The Psychology of Prediction"
Been watching Brian Belski of BMO who thinks we're in year 1 of a 2-3 goldilocks period and overall in a the midst of a 25 year US secular bull, not withstanding typical dips and turbulence. We will see...
Looking to enjoy the summer events around town. Can't complain as life's pretty good currently.

Countdown to Retirement
32.5 months to go. Crossed the 1000 day milestone.
 

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I dunno what you do exactly but there's certainly a segment up here in FM for automation-type computer/electrical/process engineering work. At a big-oil co. you'd probably come in at 150k salary the very first year and be easily at 200k+ after 3 years. Houses are cheap, too.
Getting into any big oil company with out O&G experience is very very difficult. I had experienced this in 2013-14 . Generally same employees move between the companies . unless your skill in high demand , you will not get into big O&G.. I dont know about the situation now..
 
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