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First Week Under My Belt

August 26th, 2017 at 02:32 pm

I am home from my first week of work. It looks as though I never mentioned that SB will be working at his job until August 31st. Therefore, we are moving up to the timber property on Labor Day weekend. In the meanwhile, I stayed Sun - Thurs in the spare room of friends who live in my new area. I plan to do the same thing this coming week.

At the timber property, there are 5 houses. Two houses are currently occupied: one tenant who SB wants to keep, and one caretaker who is in the process of being evicted. The three remaining houses are not currently livable, except as camping sites. Two could be made livable with some repairs and not-too-outrageously-much money; the third needs major work. We plan to move into the house currently occupied by the caretaker. Until the house is available, we will be temporarily living in a travel trailer. Which, by the way, we still need to buy.

So how was work? So much new. Working for the government is an entirely different ballgame. Everyone I have met is very nice and the atmosphere is very pleasant. Most of what I learned this past week had to do with the overall organization and structure of the County, it's policies, etc. I did learn about my actual job duties too. I do not feel up-to-speed yet at all, and still have a lot to learn.

As far as my own personal finances, I have learned:

- I will be paid every other Friday, 26 times per year.

- The County does not participate in Social Security, so no Fica-SS will be deducted from my pay.

- The County pays most of my contribution to the pension plan, but I am required to contribute 3% of my gross.

- My pension tier is 2% at 62. This means that once I vest (5 years of service), I will be eligible to receive 2% of my annual salary for each year I have worked once I have both retired and reached age 62. For example, if I work from now until age 65 then retire, I will have 14.5 years of service. 14.5 years x 2% x my salary = my annual benefit. This example would mean an annual pension of approximately 15k, assuming no cost of living raises or promotions.

- The County will pay 80% of my health insurance, while I will pay 20%. Also, there is a section 125 cafeteria plan, so I can pay my 20% pre-tax.

- There are 5 different health plans to choose from; 3 are Blue Shield plans and 2 are Kaiser plans. There is one Kaiser plan which is by far the best value of the 5, in my opinion. However, with Kaiser, you must go to Kaiser facilities for all medical services. (In the event either life or limb are in jeopardy, they will cover your out-of-network medical care, but they get to decide if it was justified or not). The nearest Kaiser facility to my new workplace is 40 minutes away. My new home is an additional 40 minutes further away. It is simply too far to go for medical care. There are doctors and a small hospital in the same town as my new workplace. Therefore, I am opting for a Blue Shield plan.

- The Blue Shield plan I have chosen has the highest premium of all 5 plans, but looking at the prescription coverage, the deductible, and the maximum out-of-pocket, I estimate it will be the lowest total cost Blue Shield plan for me.

- The Blue Shield plan I have chosen is compatible with an HCRA plan (health care reimbursement account). This means I will be able to elect an amount to be deducted pre-tax from my pay to cover out-of-pocket medical expenses. The HCRA plan will issue me a debit card, which I can swipe when making co-pays.

- At the end of each calendar year, any amount above $500 in the HCRA is forfeit to the County. Therefore, I will be conservative with the amount I am choosing to contribute.

- I will also have a dental plan and a vision plan.

- Cafeteria plan deductions are taken 24 times each calendar year, even though there are 26 pay periods. The two "extra" paychecks (the third paycheck in a calendar month) have no deduction for cafeteria plans, and thus are a bit larger.

- I will be covered on my new health insurance beginning 9/1/17. Because health insurance premiums are paid in advance, I should have paid for September in August. Since it takes awhile to get me into the system, my first cafeteria plan deduction won't happen until my second paycheck in September. Therefore, that second September paycheck rightfully should have premiums for both September and October deducted. Instead, I will pay double deductions for three paychecks. The second September paycheck will pay for September; the first October paycheck will pay for October; and the second October paycheck will pay for November. (I just used two semi-colons in one sentence!). After that, I will be on track and each paycheck will have half of one month's premium deducted.

- It is unlikely I will be contributing to the 457 plan from my very first paycheck. It takes awhile for me to be in the system and there are forms to submit, an outside party to be contacted, etc.

- The County has 2 vendors for its 457 plan. The vendors are Nationwide and CalPers. Nationwide offers some institutional shares of Vanguard index funds. I was fairly excited about this, until I saw the administrative fees Nationwide charges. Nope. I am opting for CalPers. They offer target retirement funds built from State Street index funds. The total cost is much less with CalPers than with Nationwide. I notice that their target retirement funds are too conservative for my tastes, so I plan to go with the 2050 fund.

- My union dues are 1.25% of gross + $1.

Taking all of the above into account, I calculate that once all is running smoothly (double cafeteria plan deductions are done and 457 plan contributions are happening) my take home pay will be $1,168.30 per paycheck. So that is what I am using to build my post-house-sale budget.

6 Responses to “First Week Under My Belt”

  1. My English Castle Says:

    I've never heard of a county not participating in Social Security. Is that unusual? Interesting to try to sort out the best benefit choices.

  2. Petunia 100 Says:

    It's not the norm, but also not unheard of. Way back when municipalities were given the choice of opting out. Some did, some did not. My ex-husband at one time worked for a city police department which did not participate in SS, so I looked into it.

    Of course, I have enough credits so can still draw SS benefits when eligible. Since my current employment does not count, my eventual benefits will be lower than they would have been had I continued participating.

  3. AnotherReader Says:

    It's not just the time you did not contribute to Social Security that affects the amount paid to you. There is an offset called GPO that reduces your Social Security substantially. Look up WEP and GPO to see how the SSA treats these situations.

  4. Petunia 100 Says:

    Thank you, I am aware of the WEP and GPO. The WEP won't affect me much as I have 20+ years of substantial earnings already and am not a high earner, so don't expect a large benefit to start with. But certainly, it will reduce my benefit some. I calculate about $600 per month (if I never participate in paying Fica-SS again). I'm OK with that, because I would be gaining twice that from the pension.

    The GPO won't affect me as I have no spouse or minor children to receive SS Survivor Benefits.

  5. FrugalTexan75 Says:

    I have my 457 through Ameritas (Nationwide was an option) but my post employment health plan is through Nationwide. Glad you're liking your new job so far.

  6. rob62521 Says:

    I'm sorry your job doesn't pay Social Security, but as a teacher, our state doesn't allow it either. Sounds like a decent benefit plan over all. I'm sure it was a tough week learning everything new, but I'm sure you will do well.

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