It’s the season of football games and back-to-school activities again. And if you work for a medium or large employer, open enrollment season will soon be upon us. This is the time when you can review employee benefits and make changes if necessary. What areas should you focus on?
In fact, we recommend paying close attention to all the benefits. Some services may have changed since last year. You may also be experiencing changes in your own life, which may lead you to seek out something different than your existing benefits package.
How about starting with health insurance? If you’re happy with your coverage and it’s basically the same as before, you may want to keep using what you have. is increasingly offered. But plans with higher deductibles also have the advantage of being able to contribute to a Health Savings Account (HSA). Contributions to HSA are made in pre-tax dollars, which reduces your taxable income for the year. Also, earnings are tax-free and grow, and withdrawals are tax-free if the money is used for eligible medical expenses. (Withdrawals made before age 65 that are not used for eligible medical expenses are taxable and subject to a 20% penalty. Once you reach age 65, the penalty no longer applies, but If not used, withdrawals will continue to be taxed as income.)
The next benefit to consider is life insurance. Your employer may offer a group life insurance plan, but whether it will suffice your needs, especially if there have been changes in your personal circumstances in the past year, such as getting married or adding new children. should be evaluated. There is no magic formula for determining how much life insurance you need. There are many factors to consider, including income, family size, and mortgage. .
Your employer may also offer disability insurance as a benefit. Some employers’ disability insurance is fairly limited and only covers a short period of time, so you may want to consider personal insurance.
In addition to the various insurances offered by your employer, take a closer look at your 401(k) or similar retirement plans. Your 401(k) can usually change throughout his year, but it’s important to make sure your investment choices and contributions match your risk tolerance and goals. Also, if there is an offer, are you contributing enough to get an employer match? And if you have already received a match, does such a move make sense to you? If so, can you afford to invest more in your plans?
Employee benefits packages can be an important part of your overall financial strategy. So take a closer look at what you already have, what’s on offer, and the changes you need to make as the open admissions season progresses.
Jennifer Barrett (AAMS) is a local Edward Jones Financial Advisor.
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Edward Jones, its employees and financial advisors are not real estate planners and cannot provide tax or legal advice. Please consult a real estate planning attorney or qualified tax advisor for your situation.