<p>My son had this deduction in his paycheck for about $16 last year for what turns out to be a retirement plan. It’s a 457 plan (no clue what that is) and he received some literature on it. It’s apparently a state plan for state workers in lieu of social security. There are fees involved and those fees might eat up what he has put into it. He never knew about the plan so I assume that it’s a default retirement account or mandatory. At any rate, this changes my opinion on mandatory retirement plans.</p>
<p>I spoke to a CS person at the organization that does this and he couldn’t tell me anything without my son on the line.</p>
<p>On another note, his manager at his job sent out a few emails. She found out that some students didn’t maintain a 3.0 Major Cum or had other academic problems and basically stated that you couldn’t work if you didn’t maintain the standards of the job. Just another reason to keep your grades up - you might lose your job if you don’t.</p>
<p>I once gave a talk at a state university. I got paid for it, but I cannot remember whether it was called an honorarium or something else. I found that I was also put on the state retirement plan. My pension was tiny, and every year, I received a statement telling me how much was in it–after deducting service fee. That fee eventually ate up the little amount I had in the pension plan, so I no longer receive statements.</p>
<p>DW accumulated $36.73 in a CA retirement fund while a Post-Doc. Every few years I asked for necessary forms to transfer it to her IRA, and each time I got fourteen pages to fill out … which I of course ignored. Finally we got notice that they wanted us to transfer the funds, and if we didn’t they would apply a significant annual service fee. A half-page form to do the job was enclosed.</p>
<p>I wrote a note to the State Treasurer (Tim Cahill) who is also running for Governor against Governor Patrick as an independent. The best time to get the attention of state officials is when they’re running for office.</p>
<p>Someone from the Treasurer’s office got back to me and also copied three other people on his staff. We had a chat on the phone this morning and he told me that our son shouldn’t be enrolled in this program if he is a full-time college student working at his university so it appears that this may have been an error. He’s going to look into it and get back to me. The annual fee for the program is $18.48 so it would wipe out any contributions that he’s made. I wonder if they will go after him for the other $2.</p>
<p>At any rate, this may just be a mistake by his school or by the Massachusetts tax folks. It seems like the Treasurer’s office may have to expend a moderate amount of effort just to clear up $16. Of course if this was done to all of the other tutors at his school or in the state university system, then it could be a bigger deal.</p>
<p>I guess the lesson is to look at your statements carefully.</p>
<p>I had something like $20 in my home state public employees retirement fund for years and years. I never did quite figure out which job I had in my childhood/youth is the one that was responsible for this miniscule sum of money. About five years ago, I got a check in the mail, and the paperwork for the taxes due for early withdrawal. They just booted me out. But I got all my money.</p>
<p>The Treasurer’s office got back to me. Apparently the person that entered his payroll information selected a box that said OBRE-elegible. OBRE is the mandatory pension system. They are going to contact the company that administers the plan to put the fees back in his account and then send him the money so that it shows up in an upcoming paycheck. They will also issue a new W-2, check to see if there are other students affected by this and inform them of how they are supposed to handle the pension question for students.</p>
<p>The small payroll error is probably going to cost $10,000 to fix.</p>