Any Kaiser (TPMG) docs here?

[tonyjerry]

Question about the make up plan again. If we are putting in after tax dollars into 401k to do the mega backdoor roth IRA then would we expect to get a smaller make up payment?

[2BReal]

Question about the make up plan again. If we are putting in after tax dollars into 401k to do the mega backdoor roth IRA then would we expect to get a smaller make up payment?

Good question. The answer is no, the amount you contribute to the Voluntary After Tax portion of Plan 3 does not affect the make-up payment. It's confusing for some folks because in the past, only docs who got the make-up payment could put money in to the Voluntary After Tax program, but the rules changed a few years ago, so now ALL TPMG docs (including pool physicians) can choose to contribute the maximum amount (for 2020 this is $15,585) to the Voluntary After Tax plan (in addition to their usual 401(k) contribution) in Plan 3. The make-up payment is only for docs that make above the IRS threshold for the year (this year it's $285K), and it's also capped up to $15,885 (this number changes each year depending on the IRS limit) and it's based on your base salary for the year.

[tonyjerry]

Thanks, my payment was smaller than I expected but its because I didnt start to qualify for the plan 2 until later in the year. Question for other TPMG docs here. Is the amount you are you saving/investing for retirement accounting for your potential pension or are you assuming there might not be a pension when you retire? Maybe something in between is the right answer?

[CalMD]

In MDPeople, the TPMG annual reports are there. Go over the numbers and form your own opinion regarding the pension. I am saving for retirement thinking the pension might not be there. The number of US companies with viable pension plans is dwindling.

When I started, there were 16 bookable appointments per day. Now it is 24, in addition to the inbox. Perhaps this increase is partly to fund future pension obligations.

[b52bomber]

Hello everyone!

I've read through this thread which has provided me good insight into the (no doubt) numerous financial benefits working for Kaiser as well as some of the nuances.

I'm struggling to make an employment decision and am looking for any insight (financially or otherwise) you might be able to provide. I am single and have roughly 400k in student loan debt.

I'm looking at TPMG job paying roughly 325k with the standard TPMG benefits in a VHCOL location.
I'm also looking at a non-profit (relevant for PSLF) job in my home city (where I have close family) paying roughly 225k with a 12% match and standard insurance benefits in a LCOL location.

The jobs have relatively similar duties in the description, although anticipate more duties/restrictions at KP as the other is much more casual and flexible.

For me, it basically comes down to pension + benefits of KP vs. location/flexibility/family of the other. I feel if I had a better understanding of the financial comparison between the two, it might make one stand out vs. the other. I'm happy to answer any questions although might excuse myself from some for privacy. Thank you very much!

[Hank]

How bad is the tax burden in the lower cost of living location? A single person making $325K is looking at a 10.3% marginal tax rate just from California. Plus you're looking at higher cost of housing, gasoline, etc.

On the other hand, $225K is a 31% nominal pay drop and you also don't get the pension down the road.

[b52bomber]

How bad is the tax burden in the lower cost of living location? A single person making $325K is looking at a 10.3% marginal tax rate just from California. Plus you're looking at higher cost of housing, gasoline, etc.

On the other hand, $225K is a 31% nominal pay drop and you also don't get the pension down the road.

State tax rate maxes out at 5%. Gas/housing/food/everything is definitely quite a bit cheaper from personal experience.

[Tim]

Sounds like time for a spreadsheet.
Gross
Benefits
FiT
State
Local
Employee share benefits
Rent (own later)
Car
food
insurance
travel
utiliitie
phone
internet
etc.

You can get specific amounts for many. Face it, cost of living comparison tools are available online. Build yourself a budget for each.
Include the student loans
The big items you can get reasonable estimates.
I would factor in something besides the pension.
The more accurate the better, approach this just as if you were building a REAL budget. You are.
I did this for 5 locations for my daughter. What you will find is to upgrade housing will be super expensive (exponential rather than linear) and taxes are taxes are the big ticket items.
Solve the problem and get data.

[b52bomber]

I think that's what I have to end up doing. It's going to be a real mess because I'll have to ask if I include PSLF in as a potential benefit, and there's the emotional aspect of being close to family/in a familiar location that's hard to quantify (and negatives of being away from them and in a location I might not like).

[xbox361]

how much are the fidelity plan fees for the 401k?

[CalMD]

There are several stages of "golden handcuffs" at TPMG.

The first stage is at the 5-year mark. Eligible for The Plan 1 pension. The Plan 2 (Permanente Contribution) becomes fully vested. This is 5% of the base plus bonus and 10% of the base plus bonus in excess of the IRS limit; ie, make up payment.

Around age 50 many will accumulate 20 years of credited service; this will give 2% of highest average compensation based on full time equivalent for pension. Even if part time, the calculation is based on full time equivalent so this is an advantage. Over the years I figured 0.8 or 0.9 FTE will be a good work life balance.

The next stage is at the age 55 with minimum of 15 years of service called Early Retirement. No health care. If universal health care were available, many would consider retirement at this age.

At age 60, Full Early Retirement with 15 years of service. Pension and health care. Many don't work past this age, as generally there is no further financial advantage.

As for the the pension, "Plan 1", read the Annual Funding Notice. Since 2012, how well the retirement plan is funded changed from using interest rate of 2 years to 25 years. Over the past 5-10 years, the interest rate has been low, therefore the funding target attainment percentage at the most recent Funding Notice would be artificially inflated and overly optimistic, therefore my worry. Furthermore, read page 22 of the Financial Statement, specifically "Alternative Investment". I worry about the percentage of alternative investment.

Financially since Plan 2 (Permanente Contribution) is much higher than competitors, availability to working part time at any age, in addition to the collegiality, overall TPMG is a good gig.

[asakkings]

There are several stages of "golden handcuffs" at TPMG.

The first stage is at the 5-year mark. Eligible for The Plan 1 pension. The Plan 2 (Permanente Contribution) becomes fully vested. This is 5% of the base plus bonus and 10% of the base plus bonus in excess of the IRS limit; ie, make up payment.

Around age 50 many will accumulate 20 years of credited service; this will give 2% of highest average compensation based on full time equivalent for pension. Even if part time, the calculation is based on full time equivalent so this is an advantage. Over the years I figured 0.8 or 0.9 FTE will be a good work life balance.

The next stage is at the age 55 with minimum of 15 years of service called Early Retirement. No health care. If universal health care were available, many would consider retirement at this age.

At age 60, Full Early Retirement with 15 years of service. Pension and health care. Many don't work past this age, as generally there is no further financial advantage.

As for the the pension, "Plan 1", read the Annual Funding Notice. Since 2012, how well the retirement plan is funded changed from using interest rate of 2 years to 25 years. Over the past 5-10 years, the interest rate has been low, therefore the funding target attainment percentage at the most recent Funding Notice would be artificially inflated and overly optimistic, therefore my worry. Furthermore, read page 22 of the Financial Statement, specifically "Alternative Investment". I worry about the percentage of alternative investment.

Financially since Plan 2 (Permanente Contribution) is much higher than competitors, availability to working part time at any age, in addition to the collegiality, overall TPMG is a good gig.

Does this mean that I can switch to 0.8 FTE after 3 years or becoming a shareholder and still get the full time equivalent for pension at retirement however long that ends up being.

[leftpinky]

I'm maxing out my 401k, but not sure the pension will be there. Hoping for about 70% of promised pension will be pretty good, so trying to get other investments. Maxing out 401k for 20-25 years is very healthy retirement, about the same as Plan 1 and more than enough to live on, plus most docs will have 3k in social security plus wife's SS/pension. With that said, I do count on the pension, but we aren't spending a ton right now and hope to get some other investments, too. If we lived in the Peninsula or SF, would almost need to depend on Plan 1.

CalMD--you forgot year 7, when the forgivable loan is completely forgiven.

Thanks, my payment was smaller than I expected but its because I didnt start to qualify for the plan 2 until later in the year. Question for other TPMG docs here. Is the amount you are you saving/investing for retirement accounting for your potential pension or are you assuming there might not be a pension when you retire? Maybe something in between is the right answer?

[CalMD]

Does this mean that I can switch to 0.8 FTE after 3 years or becoming a shareholder and still get the full time equivalent for pension at retirement however long that ends up being.

Ideally, especially starting career around age 30, become shareholder ASAP. Then there is flexibility to reduce FTE. It would also be financially prudent to obtain at least the 2% times highest average compensation for 20 credited service for pension; ie, 2000 hours per year. It is only 1% times highest average compensation after 20 years. For details, see Summary Plan Description and check with HR in Oakland.

I found an old email from HR that early retirement pension at age 50 will be actuarially reduced at 46.65%, age 56 at 50.12%, etc.

Yes, forgot the forgivable loan; this was not available when I joined. There is also home loan program for forgiven interest, which would be another golden handcuff.

[CalMD]

Here is a very informative Department of Labor website to see the annual Plan 1 filings, ie, Form 5500, with audited report, Schedule H (type of investment at the TPMG trust), etc. It's easiest to search by the employer identification number (EIN 942728480) and Form Year. It is also interesting to compare the retirement plan details of TPMG and SCPMG. One fascinating information...SCPMG has higher average salaries!

https://www.efast.dol.gov/portal/app...execution=e1s1