| Q. |
What are the advantages of
participating in a 401(k) plan? |
| A. |
When people talk about 401(k)
plans, you often hear about advantages like: - Free money from your employer
- Lower taxable income
- Savings and earnings that accumulate without you having to remember to
make deposits
- The opportunity to retire and not have to worry about money anymore
Does this sound too good to be true? It isn’t. It’s what you can gain from
investing in the Labor Unions 401(k) plan. The 401(k) is one of the most
popular retirement plans around. |
| Q. |
How do I participate? |
| A. |
In most cases, you are eligible
to participate immediately upon employment under a collective bargaining
agreement (CBA) or non-bargaining participation agreement that permits wage
reduction contributions to the Plan. You can check your CBA, ask your
Human Resource Department, or contact BeneSys to confirm this. |
| Q. |
How do I make contributions? |
| A. |
You contribute through payroll
deduction by completing an enrollment form and giving it to your employer. |
| Q. |
Will my employer contribute? |
| A. |
The amount of mandatory employer
contributions or employer matching contributions are specified in a
collective bargaining agreement between the employer and sponsoring union. |
| Q. |
How much can I contribute? |
| A. |
Pre-Tax Contributions. You can contribute up to 100% of your wages, in whole
percentages, up to a maximum of $23,000 per year in 2024. This dollar amount
is adjusted periodically for cost-of-living increases. Call us for the most
recent maximum.
Voluntary After-Tax Contributions.
You may contribute between 1-10% of your compensation in the form of
after-tax contributions via payroll deductions. These contributions will be placed in an
After-Tax Savings Account, are 100% vested at all times, and may be withdrawn
at any time.
Total Contributions/Annual Limits.
Total contributions to the Plan from voluntary contributions, employer
contributions and employer matching contributions cannot exceed the lesser of
100% of compensation or $60,000.
(Catch-Up and After-Tax Contributions are excluded). |
| Q. |
What are “catch up”
contributions? |
| A. |
Participants age 50 and over
will be allowed to make annual “catch up” contributions of $7,500 a year for
2024. If you intend to take advantage of this “catch up” provision, contact
your employer to coordinate the contribution through your employer’s payroll
office. |
| Q. |
Can I lose my contribution? |
| A. |
No. All contributions, employee
and employer, are 100% vested.
Remember, depending upon the investment fund or funds you choose, the value
of your account may, at any time, be more or less than the amount of your
contributions based on investment performance. |
| Q. |
Can I revoke my election? |
| A. |
Yes, at any time. Contact your
employer to stop contributions. A revocation will be effective as soon
as it can be processed by your employer’s payroll office. You cannot
withdraw any funds at that time unless you also satisfy one of the eligibility
for benefit rules. |
| Q. |
When am I eligible
to receive funds from my account? |
| A. |
You are eligible for benefits
when you satisfy one of the following conditions:
- You attain age 59 1/2 or older. You do not need to terminate covered
employment to receive a distribution of benefits at age 59 1/2.
- You terminate employment for any reason (including death, disability,
layoff, etc.) with any employer maintaining this Plan prior to age 59
1/2. Your contributions and investment
earnings are available for distribution as soon as practical following
termination of employment and receipt of an application for benefits, but may
be subject to early withdrawal penalties.
|
| Q. |
May I borrow money from my
account? |
| A. |
Yes, you may have up to 2 loans
at any one time. The minimum loan is $1,000 and the maximum is one-half of
your account balance or $50,000, whichever is less. The maximum term of the
loan is 5 years unless it is for purchase of your principle residence, which
has a maximum term of 15 years. The interest rate charged on the loan, and
paid back to your account, is the Prime rate plus one percent, currently 8.5%. |
| Q. |
How and where are my funds
invested? |
| A. |
Under the Labor Unions 401(k)
Plan, you have the opportunity to select from the investment options
described below for investment of your account once you become a vested
Participant. These investment options are mutual funds managed by
several high quality investment management firms and selected for this Plan
under guidelines established by the Trustees. You may invest any
percentage of your vested account in one or more of the investment options. |
| Q. |
How often can I switch my
investment selection? |
| A. |
Under the Labor Unions 401(k)
Plan, you may switch your investment selection(s) or transfer existing
account funds any time you want. Changes will be effective by the end of the
next business day, following the receipt of the request. Changes can be made
by accessing your account online, or submitting the Change of Investment
Form. You can submit the form via mail, fax, or email to BeneSys. |
| Q. |
Will I be charged any fees for
participating in this Plan? |
| A. |
Administrative Fees are expenses
for record keeping and administrative services. All participant accounts are
charged a flat rate based on their balance to cover the administrative fees
(legal, accounting, consulting, recordkeeping etc.). For those participants
with an account balance of under $500 the flat fee per month is $3. This flat
rate increases as follows:
The monthly fee is $7 for accounts between $500 and $1,000.
The monthly fee is $10 for accounts between $1,000 and $2,500.
The monthly fee is $15 for accounts between $2,500 and $5,000.
The monthly fee is $20 for accounts between $5,000 and $25,000.
The monthly fee is $25 for accounts between $25,000 and $100,000.
The monthly fee is $37 for accounts over $100,000.
In addition, investment management fees will be deducted as described in
general detail in the prospectus of the mutual funds. |
| Q. |
How is the Plan
administered? |
| A. |
The Plan is sponsored and
administered by a joint labor management Board of Trustees with the
assistance of a third-party administrator. |
| Q. |
How do I know my account
balance? |
| A. |
Statements are mailed out
quarterly, generally 30 days after the end of the quarter (March 31, June 30,
September 30, and December 31), and are also up on the website. At any time
between quarters you may call the administrator to check your account balance
or to access your account online. |