It’s that special time that always comes at the end of the year. We’re not talking about the holidays. We’re talking about open enrollment, those few weeks in November and December when you can make changes to your health insurance policy, enroll in your company benefits program, or ditch coverage.
The benefits you opt in to (or out of) can have a significant financial impact — positive or negative — so it makes sense to review each option carefully.
As a financially savvy individual — someone who has their personal finances in order and who’s on track toward accomplishing financial goals — you may wonder how or whether certain benefits choices influence your long-term financial success. Here are some questions you can ask yourself in order to maximize your company benefits, including taking advantage of certain perks you may not have considered in the past.
Health Plan Enrollment
What types of coverage might you need in the coming year?
Rather than just automatically rolling over your elections from the previous year, a careful review of your options could save you money. Make sure that you’re only paying for what you need, while also anticipating as best you can health events for the coming year. What preventive coverage do you need? Are you due for certain health screenings? Are you planning to finally get that elective joint surgery? Do you have any children at the age where they’ll be getting orthodontia?
Another thing to consider: How you’ve used (or haven’t used) your dental and vision coverage in the past. In some cases, it can be more cost-efficient to pay for these out of pocket, rather than paying premiums.
Does your spouse receive coverage through his or her place of employment?
Is it more financially beneficial for you to each enroll in your respective employers’ plans? Or would one or the other plan serve you both best based on pricing of premiums, level of coverage, and so on?
If you have children at home, be sure to do the math there, as well. Take the necessary time to be creative in looking at different coverage scenarios, and identifying the best one for your individual or family situation.
Beyond premiums, what are the differences in the costs and how plans compare?
Monthly premiums are pretty straightforward, but deductibles are less so. Rather than just looking at the numbers, dive into what out-of-pocket expenses you might incur, what your doctor visit deductible is versus what your prescription deductible is, and so on.
Having a complete understanding of your financial exposure under different health care plans is important to really knowing how much you may be spending.
Do you already have a health savings plan (HSA)?
Saving money via an HSA is not only an ideal way to prepare for unexpected healthcare costs, it’s also one of the best tools out there for boosting your retirement savings. If you’re switching health plans during open enrollment and haven’t previously had an HSA, now could be a good time to consider a high-deductible health plan. Being enrolled in a HDHP is required as qualification for opening an HSA, which comes with strong tax benefits.
Another perk: Your employer may offer matching contributions for your HSA.
Traditional health coverage is often just one piece of a company’s full menu of benefits. Here are a few more that you should look for and take advantage of.
- Is your company’s PTO policy that of “use it or lose it,” or do you have the ability to roll over a certain number of PTO days? If you can’t roll days over, and you don’t take days off, you’re actually losing money in a sense.
- Does your company offer behavioral or mental health benefits? More companies are offering these kinds of benefits, especially these days.
- What wellness benefits are offered? Taking advantage of things like health coaching, flu shots, biometric screenings, gym membership discounts, and so on can save you money by helping you stay healthier.
If you’d like to learn more about how your benefits fit into your overall wealth management picture, contact us at Ironwood Wealth Management. We’re pros at helping you fit together every piece of your financial life, and doing so in an individualized, personal way.