It is that time of year again! Open enrollment season is upon us – that is, the limited period each year when employees are able to make changes to the benefits they receive from their employer. Your JPP financial strategist can analyze the options available to you and can advise you accordingly, keeping in mind your unique financial and personal situation.
It is always a good idea to review your benefits package to ensure that you know the specific dates of your organization’s open enrollment period. While usually falling between October and January, each corporation, non-profit and government agency has its own dates for plan/benefit changes and enrollment. We would hate for you to miss a deadline!
The following is a list of benefits that may be offered by your organization. Many of these benefits require enrollment or updates during the open enrollment period:
- Healthcare Insurance: Many companies offer their employees a choice of healthcare plans. It is important to read through your options thoroughly so that you can choose the plan that best suits your needs and those of your family. JPP can help clients make the best possible healthcare plan selection.
- Health Savings Accounts (HSAs): Because of rising healthcare costs, many employers are offering high deductible healthcare plans. As a result, more organizations are offering HSAs to enable employees to save pre-tax dollars for deductible and copayment costs. (In 2017, the contribution limit for an individual is $3,400 and for a family is $6,750.)
- Flexible Spending Accounts (FSAs): These accounts enable employees to put away pre-tax dollars for healthcare (if not enrolled in a high deductible health plan), daycare expenses and job-related mileage. It is a good idea to update your FSA based on last year’s spending – as well as anticipated future spending.
- Wellness Incentives: Be sure to take advantage of your organization’s wellness incentives. Some employers offer cash rewards for taking online health surveys, undergoing a biometric screening for blood pressure and cholesterol, complying with medication recommendations and/or utilizing health coaching. Employers might also provide cash incentives for quitting smoking or for utilizing a FitBit to track fitness on an ongoing basis. Don’t leave money on the table — hundreds of dollars can be earned by taking advantage of these incentives.
- 401(k)s and Roth 401(k)s: Employees should be sure to maximize their allowable 401(k) contributions. At the very least, one should save up to an employer’s match limit – not leaving any money on the table. Of course, only saving to the match limit will not provide adequate long-term retirement security. We are here to help with additional savings and investment strategies.
Many larger corporations now offer Roth 401(k)s. With this type of retirement savings plan, the employee pays tax on contributed income when the income is earned, but not on any future growth. No taxes are due when the funds are distributed. Feel free to contact us to see if a Roth 401(k) is right for you.
- Disability Insurance: Often employees are offered 60% of their base pay for disability insurance as a perk. Some organizations give employees the option of paying extra for additional insurance coverage (up to 70% of base pay). Also, private insurance with specialized disability coverage options might be available to you through your employer. We can help clients determine if the cost of extra or specialized coverage is money well spent.
- Life Insurance: Employees of larger corporations may receive life insurance coverage in the amount of their annual base pay. If clients are given the option of paying for additional coverage, JPP can help clients determine if doing so is advisable.
- Tuition Reimbursement: While not specifically impacted by open enrollment, employees should contact their human resources department to determine if their company offers tuition reimbursement. This benefit enables employees to pursue further education – at little or no cost.
- Charitable Contributions: Some organizations enable their employees to have charitable donations taken out of their pay – and many companies offer matching gifts for the charities supported by their staff. Larger companies often sponsor a United Way Campaign beginning in October. Employees can target their donation by designating specific United Way agencies to receive their funds. Be sure to use your employer’s open enrollment period to update your charitable contributions if these options are available to you.
If you have any questions about options available to you during your employer’s open enrollment period, your JPP financial strategist will be happy to make recommendations to you.