With no wage raise in years - would you turn down a bonus?

joyfulguyAugust 13, 2011

Who'd turn down free money, right?

But many employers, though not having offered a raise in years, have offered some extra income that not nearly all of their employees make use of.

If the employee makes a contribution to their retirement plan, many employers offer to pay something also, often 50% of that amount, up to a certrain maximum, e.g. 6% of the employee's wage.

Quite a large number of employees don't make full use of such an offer, with a substantial percentage of their workforce making no use of it at all.

See my message on this topic over on the Kitchen Table forum. And, quite liely (dang computer - that was supposed to be "likely"), discussion, as that's a busy forum.

With regard to that error ... do you figure that we should "finger" the fingers??

ole joyful

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mike_kaiser_gw

Many people ignore the opportunity of employer matched 401k, etc. contributions -- it's essentially free money.

I caught an interesting story as part of the Freakonomics Radio podcast series. Many people are lousy at saving but love to gamble. So this bank in South Africa came up with the idea of rather than paying every customer a few dollars in interest every month they would instead pool the interest earned and hold regular drawings for cash prizes. For example, every month 10 customers would win $1,000, 5 customers would win $2,500 and one customer would win $10,000. There was also an annual drawing for, say, $100,000. The program was wildly successful but the South African government determined that the bank's lottery was competing with the national lottery and shut them down.

For the same reasons, banks can't do it in America either. Although they did say some credit union was trying something similar in, I believe, Michigan.

    Bookmark   August 30, 2011 at 7:17AM
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joyfulguy

With something like 25 years experience as a personal financial consultant, I have yet to buy my first lottery ticket: poor investment.

But ... I think that I gained something like $10. - 14.00 several years ago via lottery tickets. A local gas provider offered a free lottery ticket for people who bought more than a specified amount of gas and, since they had the same gas and same price as other providers, I took advantage of that bonus.

Description of a government-operated lottery/casino: a voluntary tax on the stupid.

ole joyful

    Bookmark   September 8, 2011 at 11:10PM
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joyfulguy

Re-iteration, if you don't mind (it needs to be etched into the minds of many of us) ...

Definition of a (government-operated) lottery/casino: a vountary tax on the stupid.

That said ...

... recently a friend won over 3 million on a government-operateed lottery ...

... and he's a supporter of our third party, that's never been in government, but recently became the Official Opposition in our Federal government.

But it's another government that runs the lottery, in this province.

When I asked him whether he hired a limo, as many major winners do, to take him the 120 miles to the headquarters to pick up his winnings, he looked at me and grinned, then said, "You know me better than that, Ed - I drove my own car!".

They make a video of all the major winners, sometimes getting people dancing and laughing while they tell how they're going to buy a house for their Mom, take a vacation in Florida, etc.

When this guy quietly said that they'd share with his and his wife's brothers and sisters, give some to charities and political support and, since their house mortgage was paid off, invest the rest ... the interviewer told him that he was the worst interview that she'd ever had!

ole joyful

    Bookmark   January 20, 2012 at 6:18PM
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mary_c_gw

I think you may be preaching to the choir here - you posted this in August last year, and did get one response.

But now you're repeatedly bringing the topic up, as you do on other forums. Why?

If it's just to stir the Household Finances pot - well, most of us here actually do know how to manage retirement accounts with employer matching.

    Bookmark   January 22, 2012 at 8:11PM
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tlbb

I haven't seen this before and found it interesting and amusing.

Take it easy mary c.

Sheesh.

    Bookmark   January 23, 2012 at 12:49PM
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joyfulguy

I grant you - sometimes I drag these messages back into the limelight.

If 10 people had seen it before, if they didn't remember ... when they opened it, no one twisted their arm to make them continue reading.

If two people had not, and found it useful ...

... some ground was gained, no?

If 85 of 100 know how to manage their retirement plans (which I doubt), fine.

If one or two hear and find it useful, then saves/gains a few dollars (plus gains ground regarding retirement funding ... and we're living longer, with fewer pensions, we need to remember) it seems to me to have been worthwhile.

o j

    Bookmark   January 23, 2012 at 3:49PM
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RooseveltL

Lottery is one of the worse government tactics in the world as they advertise for gambling with very bad odds.

Retirement should be standard/common sense but many folks rather upgrade their big screen TV or mobile phone each year with latest versions vs. put some away in long term savings. Not much preaching to the group on here in my opinion as anyone who will go on a website to find ways to save or consider alternatives to how they manage finances would mean they are savvy or in the right direction.

    Bookmark   January 24, 2012 at 9:48AM
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nancyinmich

My relative is on the board of the Communication Arts Credit Union in Highland Park, Michigan that has the Save to Win promotion. From their website:

Save To Win

What is Save to Win?
It's a very different Certificate of Deposit account now available at eight Michigan credit unions, including CACU. It is designed to making saving fun, allowing you to start with as little as $25 and then awarding you with chances to win cash prizes as your CD balance increases. You can deposit to your Save to Win CD as often as you want during the 12-month term. Each $25 increase in your Save to Win balance will give you a chance to win - up to 10 chances every month.

How do I open an account?
Simply contact a financial service representative at your participating credit union and request a 12-month Save to Win share certificate. Are you looking to join a great credit union with top-notch service? Communicating Arts Credit Union is the one to join! Call (800) 433-8780 for friendly assistance.

What are the prizes?
The real prize is the nice savings balance you will build as you make regular deposits to your Save to Win account each month. But to make things exciting, there's one annual grand prize of $100,000 that will be awarded in January 2012. All Save to Win account holders at participating credit unions in Michigan will be eligible for the grand prize. Plus, monthly cash prizes ranging from $15 to $400 will be awarded at each credit union union. A total of $5,000 annually in monthly prizes will be awarded at CACU!

How are prize entries calculated?
At the end of each month, our computer system will look at your Save to Win account balance and will automatically give you one prize entry for each $25 increase. For example, if you make $50 in Save to Win deposits during one month, you will receive two prize entries for that month. Those entries will also be added into the grand prize drawing, giving you additional chances to take home the $100,000!

Click here for Official Rules, including a list of participating Save to Win credit unions.

    Bookmark   March 17, 2012 at 1:02AM
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colorcrazy

We saved for retirement and have a nice nest egg, plus paid off the mortgage. But if all financial institutions crash and we have a severe depression, we would be left with the house and our pension checks and nothing else. At that point, I will wish I had spent the money on vacations, etc. You try to do the right thing but you just never know.

    Bookmark   March 25, 2012 at 10:39AM
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joyfulguy

Owning something is often better than loaning to someone else and having nothing to show for it but a piece of paper if that entity goes broke, doesn't pay, etc.

Including banks - several of which have, in your country, died in recent years. If small ones die - deposit insurance can cover ... but if a really big one dies ...

... good luck in being able to realize more than a pittance per dollar that they owed you.

ole joyful

    Bookmark   June 7, 2012 at 2:34PM
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MrsShayne

I'd rather flush my money down a casino toilet than invest in the stock market. Which will crash again... It's only a matter of time.

Stocks AKA legalized gambling thanks to our politicians.

    Bookmark   August 15, 2012 at 3:54PM
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RooseveltL

MrsShayne. I can't say stocks are legalize gambling as it is sponsored. E.g. Fannie MAc, Freddie, AIG are all stocks which should be at 0 but government stepped in. Same can be said for Chrylser, GM so even though certain industries aren't guarantee their lobby and political influence on (aka jobs) allows them to make gambling mistakes but never take a full lost. Both parties are guilty of this so it is just our government as no one is campaigning on change.

    Bookmark   August 23, 2012 at 9:19AM
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cmarlin20

Seems this thread is foretelling doomsday...

kinda sad.

    Bookmark   August 23, 2012 at 10:55AM
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joyfulguy

Hi CMarlin20,

Well ... many employers still offer to partially match a portion of their employees' contributions to a retirement account.

And many employees neglect to make use of that option.

Which, as I suggested earlier, is like turning down free money.

Which many still do.

ole joyful who, having reired about 15 years ago, doesn't have that option.

Didn't when I was working, either, as my employer didn't offer such contributions to retirement account.

    Bookmark   November 29, 2012 at 7:54PM
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tinan

Most employers do not offer matching retirement funds any more.

    Bookmark   November 30, 2012 at 12:51AM
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joyfulguy

Seems like a bit of a shame not to have made at least a bit of a celebration of the one-year anniversary of the most recent post.

Unfortunately ... it does seem as though fewer and fewer employers are offering free money, any more.

Though my final employer didn't offer any pension situation, for almost twenty years I've been enjoying a pension provided by my earlier employer(s), on a both they and I making required contributions of specified amounts basis ... but no increments for some recent years: poor investment returns.

ole joyful

    Bookmark   December 6, 2013 at 6:53PM
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evaf555

Old joyful:

I was still living at home as a teen when our state instigated a lottery. My Dad used virtually the same phrase, "A tax on the stupid."

Missing Dad today....

    Bookmark   December 27, 2013 at 7:35AM
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joyfulguy

Hi Eva 55,

Sorry you're missing our dad.

My Dad left this dimension of life 27 years ago, but I seldom saw him for years prior to his passing, so missed him much less than my farmer brother, who usually saw him weekly. There was 28 years between our ages - so now I'm one year short of his age at death.

Having lived in 22 locations during my 84 years, I've never owned a home. During the first part of my career, usually I'd lived in employer-owned housing.

But ... realizing that when I retired, I'd have to provide my own housing, I made some investments from time to time.

As they were on a fairly long-term time horizon, I made a substantial portion of them in various quality stocks, a number of which have enjoyed fairly steady growth, in both price of the stock and the annual dividend.

One, which had grown from $4.17 per share, had grown to about $90.00, and I was about to contribute it to a charity, which would mean that I would have paid no income tax on half of the almost $86.00 of capital gain ... but it was in certificate form, so it would have taken some time to verify its legitimacy., so it didn't get used.

Transferred some shares that were held electronically at the stockbroker's office to the agency that serves the charity, instead.

I'll have them send most of it to a couple of dozen agencies which I support. One local hospital has some donors willing to match gifts received for the next month or so. Some other agencies have matching supporters, as well so one's support is magnified.

Some of the gift is money diverted from income tax - I figure that most of the charities make good use of the money.

ole joyful

    Bookmark   December 27, 2013 at 7:10PM
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