Emirates Retirement Fund
 

A quick question for you Emirates guys and gals.

Does your retirement include the provident fund and an end of
service benefit or is it just one or the other.

Thanks,

BDD

Just one.

The provident fund usually covers the EOS benefit.

Thanks Wiz.

BDD

BDD,


The EOS benefit is designed as something of a safety net in case the Provident Fund tanks prior to retirement.


As Wiz says, your pay-out is the higher of your PF or EOS benefits.

Hmmm. Think I disagree with you there. The Provident A Fund is by no means a safety net of any kind, it is a book-keeping dodge by the company very cleverly presented as some kind of perk. They will owe you your EOSB in full when you leave. That is just the law, not a kindness. Some clever spark decided to lay off that future cost incrementally, a month at a time, to avoid the shock to the company bottom line when you depart and your EOSB comes due. Some even cleverer spark decided to present this accounting dodge to you as a gift from the company.

The B fund serves no purpose other than to tie up your money with your job.

Both the A and the B fund options are so conservative and generic they offer no true investment options for someone willing to take risk proportional to their age. Worse, unless your future is planned in one of four currencies your retirement plans are totally at the mercy of your intended home country's exchange rate.

The C fund is a perk for the fund managers, NOT the pilots. The built-in management fees are laughably high until you drag out a calculator that shows you will leave EK with about $150,000 of your money left behind in someone's Gucci wallet, then the laughing stops. You can avoid this theft of your family's future in only one way: under no circumstances whatsoever use the C fund.

Drop, where can we find out what the fees are? I've asked Mondial a couple of times and they can't/won't give me an answer.

BDD, for tax planning, when you take your A fund back to the USA you will be taxed on that fund. The B and C fund have already been taxed as it was part of your pay, however the capital gains on the B&C are also taxable.
I was also advised by my tax lawyer to arrive into the USA after the money arrives. I am not sure how long that will take. I have heard 6 wks.

nakbin,


The fees for the non Russel funds are shown on the fact sheets (in the document library) on the towerswatson web site on the portal. For the Russel fees you need google the prospectus for the fund. Its been a while but for the equity funds I am in it varies from 1.9% to 2.3%. Or so the documents say.

Fees:

Cash: 0.2-0.4%
Currency: 0.2-0.5%
Bond: 0.5-1.0%
Equity: 0.75-1.25%
Property: 1.2%

The fees published on the fact sheets are retail. Emirates is able to offer institutional pricing due to the size of the Provident Scheme. The fees are reasonable given the region (in fact, competitive with most regions offering mutual funds; ETF's are a different story).

EOSB is not paid along with A fund. One or the other (the higher of the 2). Fund was established many years ago to satisfy the company requirement to provide EOSB and as a perk to attract pilots to a new airline/region where no one wanted to come.

Where does the Company contribution go?
 

Out of interest, if you leave before 5 or 7 years of "Qualifying Service", where does the 100% or 25% retained Company contribution from your A-Account go?

I have chosen to "gamble" with that money in different funds.
So if the A-account goes up (which it has done) does EK get to keep it all? I presume yes.

Thanks Drop.