Your To Do List For Open Enrollment
By David Dierking
Over the next couple of months, employees all across the country will begin receiving their annual open enrollment information packets from Human Resources. For most, this will be the one chance a year to select which insurance plans and benefits you’ll have for all of 2011. With only one shot, it’s not a process you should take lightly.
While some employers will automatically default to last year’s selections if you don’t do anything, that’s not an invitation to ignore the choices in front of you. With factors such as marriage, divorce, birth of a new child, major surgery and retirement changing all the time, you’ll need to spend at least some time trying to anticipate your needs for the coming year. If you don’t, you could be needlessly spending hundreds of dollars on costs that could have been avoided.
With open enrollment time just around the corner, here are a few particular areas that you should spend extra attention on.
Flexible Spending Accounts
If you have planned medical expenses (co-pays from doctor visits, medications, surgeries, pregnancy, etc.) or dependent care expenses (day care), you’d be wise to take advantage of this option. Any money put into a medical care or dependent care flexible spending account is pre-tax so putting a couple thousand dollars into an account can save you hundreds of dollars in taxes. Make sure you plan your estimated expenses carefully though because you forfeit any amount that’s left over at the end of the year.
High Deductible Insurance Plans
Similar to the flexible spending accounts, your choice of insurance plans should depend in part on any planned medical expenses. You won’t be able to predict everything that could happen but any expected costs could swing your choice. The high deductible plan could be more appropriate for those who are healthy with little expected medical costs. The lower monthly premiums could save you money. Conversely, if you’re planning the birth of a child or a major surgery, you may want to choose the regular plan so as to not pay too much out of pocket.
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Spousal Coverage Cost
One of the tricks that many employers have been using lately to trim their own costs is to charge you ($75 per month is typical) to have your spouse on your company’s insurance plan. With this additional charge, it’s increasingly making more sense for you and your spouse to sign up for the individual insurance plans at your respective employers instead of the family insurance plan. Check out your options and the costs of each so you’re not needlessly spending money on premiums.
Employee Stock Purchase Plans
Publicly traded companies often times offer their employees an ownership share of the company through stock purchase plans at a discount price. There’s a chance that this may be your only chance this year to enroll for it so think if you want to take advantage of it.
401k Plan Contributions
You can typically change your retirement plan contributions at any time throughout the year but this might be a good time to review your choices and make sure they’re still in line with your goals. This would go for both the amount you’re contributing and what you’re investing in.
Photo credit: C-Towner
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