Vacation Days, Retirement Plans

Our company just made a change to our policy regarding banked vacation days. Under the current policy you can save (or bank) up to 10 days of your vacation each year once you have 20 years of company service. You can have up to 30 days in the bank. (40 days if you have more than 30 years service) Starting Janurary 1 of 2007 you can only have 5 days in the bank. If you have more than 5 days in the bank on Jan 1 then you are grandfathered and can keep them there. The amount in your bank can not ever get above that level. There were several reasons given but the heart of the issue is the people would bank their vacation days and then when they retired they would get paid for them. The big reason for doing this is that this "pay in lue of vacation" would be factored into your pension calculation. (The pension calculation is based on your last 5 years pay).

This is obviously a negative for me although it’s not a huge hit. I have 23 days in the bank so I could put 7 more days in this year to fill up the bank. I have been pretty dilligent about putting days away. That’s just the way I am. If I put the 7 days in then it means taking a shorter Christmas vacation this year. The most likely plan is for me to put 6 days in and then take a 9 day vacation.

Everyone is expecting the company to freeze the existing pension plan similar to what IBM and others have done. I don’t know when, or if, that will happen but I’m always working on my contingency plans to be prepared to make the most of whatever happens.

For example, a freeze on the pensions would mean I will have to work longer to retire with the same financial status. But it would also eliminate any penalty for working part time. (right now working part time means you last 5 years pay is lower and your pension would suffer). I really enjoy what I’m doing and would love to move to part time for a few years as I wind down my career. I would seriously consider reducing my hours, moving back to Vermont and continue to work until I’m about 60. My group is well positioned to allow me to do that. In fact, it would be an excellent way for me to groom my replacement.

I don’t know what will happen but I’m really working toward trying to get back to Vermont to be near family again. I love my work but I love them more.