7.5% for Retirement

[Kris1]

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My GME office is taking 7.5% of our pay and investing into local businesses as a retirement account for us. Is this typical? It seems really steep and they aren't matching any of it. They told us we have no choice but I can think of better ways to invest my money. Should I raise a fuss or is it pointless? How soon can I take this money back and at what penalty?

 

[MOHS_01]

I don't know if there is anything that you can do about it or not, but I would damn sure raise the fuss. It sounds like nothing more than theft to me.... they're looting your earned wage and directing it away from you. Nail them up by their......

 

[UserNameNeeded]

What has the performance been of these accounts? I would think the return would be greater investing in local businesses (provided you're not in an economically depressed part of the country) than it would be via the traditional fixed income investments and maybe even better than the major equity markets.

 

[penguin24]

Sounds fishy

 

[edmadison]

Are you paying Social Security Taxes? There are some locations (NYC rings a bell) where municipal or state (I think) employers can opt out of Social Security and set up another pension plan. I suspect that is what is going on. If I recall correctly, you are simply trading SS for something else. Thus, you're really no worse off.

Ed

 

[UserNameNeeded]

But if everyone thinks social security won't be around by the time we reach retirement age, then is it really worse?

What's the provisions for withdrawal from this retirement account? Will you be able to roll it over into an IRA after you're no longer a hospital employee?

 

[Kris1]

I have yet to receive my first paycheck but will be getting that this week. I'll take a close look at so that I can answer the questions posed so far. I am gathering that this isn't common practice though.

 

[lord_jeebus]

Sounds odd. Definitely ask how you can get your money out when you no longer work there.

The potential for corruption with this scheme seems high.

 

[Kris1]

So I asked today and was told that wasn't a GME thing but a state of Florida thing. Apparently this is their version of Social Security and it is going into a 403(b). I'm not really sure what that means. Guess I will research that.

 

[michaelrack]

a 403b is basically the non-profit org version of a 401k. The part about "investing into local businesses" is pretty strange- you should investigate that part of the deal

 

[UserNameNeeded]

And when are 403(b) contributions mandatory? I guess it's a Florida thing.

 

[xanthines]

It could be going to the FL retirement system. I'm not from there, but I've heard about it. Some kind of state pension/investment plan or something...

-X

 

[lobon]

this is how my florida college/medical school paid as well, everyone from attendings down to undergrad employees. i dont remember the details but it is not a scam

 

[Jehnavi]

There is no way to tell if she will make money
or lose money, because the stock market goes
up and down. Mostly up we hope.
Learn to invest money