With the open enrollment period for benefits coming up soon at many companies, this is a good time to start thinking about your options.
Open enrollment is usually a four-week time when companies let their employees sign up for various health and retirement savings benefits, as well as smaller benefit options that may be unique to a business.
"Employee benefits are a very important component of an individual's financial plan," said officials with the Financial Planning Association, in a recent press release. "That's why it makes sense to talk about your benefit choices with a financial planner or your human resources professional to see how such choices at work fit into your overall financial strategy."
The FPA offers the following tips:
Review your health plan choices: Think about all the health issues you've experienced throughout the year. It could be a diagnosis of a chronic disease, the birth of a child, or the need to place a new spouse or partner on your coverage -- open enrollment is the only time of the year where you can make those changes.
If you're under the age of 35 with no significant health problems, opt for a lower-premium plan that requires higher co-pays or deductibles, the FPA suggests.
Don't forget prescription coverage: You need to look at your prescription needs and find the best insurance choice to cover them. While you may have a co-pay of $5 to $10 for generics, can you afford a brand-name drug that may carry a co-pay of $50
or more if you need it? Make sure you understand the tier system within your pharmaceutical plan and pick the right one for you, FPA officials say.
Understand the FSA/HSA maze: A Flexible Spending Account is an account employers offer so workers can deposit funds to pay their out-of-pocket health and dependent care costs on a pre-tax basis. However, workers need to make a good estimate on the funds they'll use by year's end because excess funds can't be carried over. Health Savings Accounts allow workers to save pre-tax dollars for health-care costs without the "use it or lose it" restrictions of FSAs.
These dollars often can be directed into different investment accounts and used on a tax-favored basis in retirement. HSAs must be paired with high-deductible health insurance that carries a $1,000 individual/$2,000 family deductible, according to the FSA.
Weigh the freebies: Depending on the size of your organization, you might get a break on gym or vacation packages or discounts and freebies at certain retailers.
Use open enrollment as a chance to check your 401(k) holdings: Fall is a good time to see whether your holdings still fit your age, your risk tolerance and the kind of retirement you want. It's worthwhile to get some advice here, FPA officials say. To see more of the Tulsa World, or to subscribe to the newspaper, go to http://www.tulsaworld.com. Copyright (c) 2009, Tulsa World, Okla. Distributed by McClatchy-Tribune Information Services. For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.
Copyright (C) 2009, Tulsa World, Okla.