It’s that time of year again, open enrollment. Yeah, I know you’re tired of being hounded with information about it, but the reality is this time of year is really important. You need to get your head in the game. This week I went on Fox 59 to share the three items you need to prioritize this open enrollment season, click here to watch the video.
Open enrollment is the perfect time to evaluate what you are doing. Your employer spends a lot on your benefits, so take advantage of what’s being offered. It’s easy to just stick with what you are already doing, or copy your neighbor’s plan, but that won’t do. Your benefits only work for you when they are tailored for your specific needs, and only you know your specific needs. So take the time to do your research this open enrollment season.
First, investigate a Health Savings Account (HSA). I’ve discussed this at length before, I’m a huge fan. I highly recommend them. Check out my HSA primer here. The biggest benefit of an HSA is the advantage it gives you at retirement. Your Health Savings Account is yours to keep forever, which can be a major advantage come retirement.
Your first thought when it comes to open enrollment is healthcare, but don’t forget to adjust your other benefits as well. This is the perfect time to increase 401(k) contributions. At bare minimum you should increase your percentage 1% a year. But remember your goal is to contribute up to the government cap, so only adding a percentage a year isn’t going to get you there very fast. Another benefit you should consider adjusting is your disability insurance. Many employers offer disability, but it’s unlikely the coverage is enough. Think of it this way, you are significantly more likely to become disabled, than to die at a young age, so seriously consider adding supplemental disability coverage.
Open enrollment is a really important time of the year so don’t neglect to take it seriously!
Peter Dunn a.k.a. Pete the Planner® is an award-winning financial mind and a former comedian. He’s a USA TODAY columnist, author of ten books, and is the host of the popular radio show and podcast, The Pete the Planner Show. Pete is considered one of the foremost experts on financial wellness in the world, but he’s just as likely to talk your ear off about bass fishing.