Question: What are the different line items on my paycheck and/or job dispatch? 

Our Local is helping save you money for the future. Here are two programs to keep in mind when you open up your next paycheck.

 

Health and Welfare Extended Reserve Account

One dollar of your journeyperson wage package goes into your own personal Health and Welfare Extended Reserve Account. This is your own personal savings account that is not taxed going in and not taxed going out, and can be used to pay your health care related expenses such as copays or prescriptions. When you use your BeneCard, the monies paid come out of this account.

Unused money at the end of the year rolls over and stays in your account. A number of journeymen choose to save this money for a rainy day because these funds can also be used to pay medical insurance premiums when they haven’t been working. Like a health savings account, most medical expenses are covered as long as they are approved by a physician and are not cosmetic.

 

Pensions

There are three types of pensions. All of them are tools that are part of ensuring that our members retire one day with dignity. The first is a 401(k) plan, a retirement savings account that lets you save and invest a portion of your paycheck before most taxes are taken out. This is completely voluntary and it is your choose how much you want to contribute.

The second is a 401(a) plan. All journeymen automatically contribute $6 an hour before any taxes into this plan. You can buy a home, send your kids to college or consolidate debt with this money. You can also borrow against this money at 6 percent — and that interest goes right back to you. So rather than paying a bank or credit card, you’re paying into your own personal account.

The third is a defined benefit plan, a much more traditional pension. Here, only employers contribute money toward workers’ retirement. There are no individual accounts, but rather a single trust fund that allocates money to eligible participants. Your payout is calculated according to how long you worked and how much you earned as a journeyman. Once you retire, you are guaranteed to receive a paycheck every month for the rest of your life.