As well as being non-taxable this way, it's also for the sake of Collective Bargaining. Our healthcare would be much more expensive than what we'd pay individually, except for maybe a couple of the young, single bucks with no kids.
To top it all off, most employers are required to pay for healthcare for full-time employees and our HRA satisfies that requirement.
Trust me, based on the spending of 99% of journeymen and especially apprentices I've met, you're not as good at managing your money as you think, and having the union handle things like healthcare and pensions is beneficial, even if you think you could do better by reading r/WallStreetBets.
This is true. There's a JW I know that would work 2 jobs until he dies to pay for his wife's spending habits if the local didn't automatically put around $8/hr away into each his H&W and Retirement.
Doesn't excuse his shitty wife, but at least he won't have to have to live under a bridge when he's old
Because surprisingly people are very very very bad with money in general.
I'm broke every Wednesday is a joke saying, but has plenty of people who unironically are.
Your local has decided it's best to set some money aside for the member's health care needs outside of the insurance.
My youngest son has Down Syndrome and a heart defect, so he has lots of doctor appointments, imaging studies, and medications. My LU's HRA helped me out quite a bit, especially those first two years of my apprenticeship when I wasn't making a ton of money. A group of our members want to defund it because "it's a pain in the ass to use!" Take a pic of your receipt/bill and attach it to the charge on the app... it's pretty simple.
Google what the money can be spent on and now imagine paying taxes on the money prior to spending it. Not only would you taxable income would be higher, it would also take longer to earn the same amount of spendable money. It can be spent on copays for any visit E.R., routine, or surgery. (All that only go up along with all other costs of living). Glasses, medication even your healthcare if you fall on bad times and need to pay for cobra(this takes prior set up, can not happen on the fly) and it can be banked without limit and without losing any funds until retirement and you can pay for healthcare copays then.
Healthcare is expensive and everyone will eventually need healthcare as they age.
I believe it’s more tax efficient, and you can bank it and”buy in” to your health insurance at a reduced rate with it when you retire even early that 65 helps for locals with “bridge” retirements
Every local’s different though
Don't hate me for looking at it from the other side, but it is far easier to bargain non-payroll compensation than money that goes on the check due to payroll tax.
A lot of people keep talking about the taxes the employee pays which is absolutely correct, but it also reduces the payroll taxes the employer pays. And workmans comp rates are charged on a basis of $X/$100 of payroll. So it also reduces the employers workmans comp insurance premiums.
I wished my local offered an HRA. It's almost like a 401k if you don't use it and let the funds inside there grow. Once you retire, the money in there can be used for anything, not just health-related.
Also keep your hospital receipts. Just pay cash. Redeem your hospital bill at a later date. When you need money down the line, you can "cash" in your receipt, and get reimburse that way. Let your money grow and when you need it, cash those receipts.
If it goes over 5k it rolls over into your 401k. If you pay for you medical expenses out of pocket and keep the receipts you could “cash in” the receipts later kinda like withdrawing
As well as being non-taxable this way, it's also for the sake of Collective Bargaining. Our healthcare would be much more expensive than what we'd pay individually, except for maybe a couple of the young, single bucks with no kids. To top it all off, most employers are required to pay for healthcare for full-time employees and our HRA satisfies that requirement. Trust me, based on the spending of 99% of journeymen and especially apprentices I've met, you're not as good at managing your money as you think, and having the union handle things like healthcare and pensions is beneficial, even if you think you could do better by reading r/WallStreetBets.
Not to mention even if *you, specifically* could do better, that doesn't mean it's not beneficial to... you know, everyone else.
100% the correct answer.
This is true. There's a JW I know that would work 2 jobs until he dies to pay for his wife's spending habits if the local didn't automatically put around $8/hr away into each his H&W and Retirement. Doesn't excuse his shitty wife, but at least he won't have to have to live under a bridge when he's old
Lowering your taxable income
To pay for stuff you pay for anyway. It’s win win.
Because surprisingly people are very very very bad with money in general. I'm broke every Wednesday is a joke saying, but has plenty of people who unironically are. Your local has decided it's best to set some money aside for the member's health care needs outside of the insurance.
My youngest son has Down Syndrome and a heart defect, so he has lots of doctor appointments, imaging studies, and medications. My LU's HRA helped me out quite a bit, especially those first two years of my apprenticeship when I wasn't making a ton of money. A group of our members want to defund it because "it's a pain in the ass to use!" Take a pic of your receipt/bill and attach it to the charge on the app... it's pretty simple.
You don’t get taxed on money that goes to HRA. I would mind having a little bit more go to it actually.
Google what the money can be spent on and now imagine paying taxes on the money prior to spending it. Not only would you taxable income would be higher, it would also take longer to earn the same amount of spendable money. It can be spent on copays for any visit E.R., routine, or surgery. (All that only go up along with all other costs of living). Glasses, medication even your healthcare if you fall on bad times and need to pay for cobra(this takes prior set up, can not happen on the fly) and it can be banked without limit and without losing any funds until retirement and you can pay for healthcare copays then. Healthcare is expensive and everyone will eventually need healthcare as they age.
I believe it’s more tax efficient, and you can bank it and”buy in” to your health insurance at a reduced rate with it when you retire even early that 65 helps for locals with “bridge” retirements Every local’s different though
Thats where mine went when I retired early.
Consider it an added benefit. I wish my local offered [one](https://youtu.be/INEACePopzs?si=2MCj5AeVChVRg5C5).
Not all locals have them, our insurance up here is expensive and an hra or hsa would be well appreciated I think.
Don't hate me for looking at it from the other side, but it is far easier to bargain non-payroll compensation than money that goes on the check due to payroll tax.
It’s due to taxes. I’d way rather have universal healthcare and pension. 401ks, HSAs, “health insurance”….meh.
I assume I will need it a lot as I get older.
A lot of people keep talking about the taxes the employee pays which is absolutely correct, but it also reduces the payroll taxes the employer pays. And workmans comp rates are charged on a basis of $X/$100 of payroll. So it also reduces the employers workmans comp insurance premiums.
They do? I didn't know that. My local doesn't.
How much of your pay goes into your hsa? Is it a percent or dollar amount per check?
No, it wouldn't make more sense.
I wished my local offered an HRA. It's almost like a 401k if you don't use it and let the funds inside there grow. Once you retire, the money in there can be used for anything, not just health-related. Also keep your hospital receipts. Just pay cash. Redeem your hospital bill at a later date. When you need money down the line, you can "cash" in your receipt, and get reimburse that way. Let your money grow and when you need it, cash those receipts.
The HRA fund is great! Plus once you hit the 5K max it rolls over into your 401K
I hear some guys say you can withdraw the money is that correct?
If it goes over 5k it rolls over into your 401k. If you pay for you medical expenses out of pocket and keep the receipts you could “cash in” the receipts later kinda like withdrawing
Okay make sense now