My Benefits and What I’m Choosing
Open enrollment is the time of year where you get to make changes to any benefit options your employer gives. I just had my open enrollment meeting this week and there were some changes for the next year.
Options for Medical Insurance
My employer continues to offer two medical insurance plans. One is a traditional PPO plan and the other is a high deductible plan. The 2018 cost for the PPO pan is $397.88 for Family and $56.74 for individual employee. The cost for the high deductible plan is $341.24 for the whole family and $30.40 for the individual. There are also options for employee and spouse (no children) and employee and children (no spouse).
Both plans cover preventative services for participating providers. The difference comes for other professional services beyond preventative care. For example if I were to go to an appointment with orthopedics or other specialty I’d be charged a $30 copay on the PPO plan; if I am on the high deductible plan I would pay the total cost of the visit until I reach my deductible, once I hit the deductible I would pay 20%.
For medications if you’re on the PPO plan you would pay the copay for the medication. On the high deductible plan you pay the total cost until you hit your deductible then you pay 20%.
One advantage to participating in the high deductible plan is that it makes you eligible to participate in an HSA plan. My employer encourages participation in the high deductible plan by contribution $2,750 to an HSA if your family is enrolled. Otherwise you would only get $575 contributed to an HRA.
I was anticipating cost of medical insurance going up this year as I had read an article that stated there would be an increase but was pleasantly surprised that they didn’t increase that much for me. Currently I pay $330.36 per month for medical insurance for my family and $68.78 per month for dental insurance. Medical insurance will go up to $341.24 per month and dental insurance actually went down slightly to $64.68 per month.
I’ve decided to enroll in the high deductible plan due to the lower cost of the premium and the great contribution into the HSA by my employer. Also, I can contribute money to the HSA and if it is not used it can be saved and invested similar to an IRA account, essentially becoming another tax advantaged retirement vessel.
Other Benefits
My employer provides long-term disability insurance for providers as well as basic life. The basic life and AD&D coverage is equal to two times basic annual earnings (base salary). There is an option for more coverage but I have chosen to purchase extra insurance outside of my employer options as I felt like I could get better prices from non-employer plans.
The long-term disability insurance begins following 90 days of disability and benefits equal 60% of monthly earnings up to a maximum monthly benefit of $15,000. Short-term disability is not provided, but we can elect to participate in short-term disability insurance as well if we want to pay for it.
Take Time to Review Your 401k
Another benefit that I like to personally review this time of year is the 401k. My employer will match the first 3% that is contributed and an additional .5% for the next 2%. It’s a little confusing but basically in order to get the full amount that will be matched I have to contribute at least 5%. If I contribute 5% I will get the full match amount of 4% of my income.
Along with the match the company also provides profit sharing. For any employee that is eligible the company will provide a discretionary amount for profit sharing. The amount is determined on an annual basis and is a percentage of income.
We have financial planners available, so I set up a meeting to discuss how my 401k is invested and any recommended changes. It is a service that my employer already pays, so I figure if I don’t meet with them I’m losing out; if you have this available you should make sure to take advantage of it as well.
After meeting with the financial adviser I decided to change a few things in my 401k. My current portfolio is very aggressive with 10% in bonds and 90% in stocks; I’m still far out from retirement and feel like I can absorb more risk now. The change I made was to invest a larger portion into international stocks. I was previously invested 50% in large cap funds but have lowered that to about 40% and invested more into international funds. If you’re wondering what your asset allocation should be you can use a calculator to determine what your mix should be but it’s always good to speak with your financial adviser about this.
Also, I was contributing mostly to the Roth 401k option as it would give me tax diversification in retirement but after speaking with the financial adviser and looking at my current income I have changed my contributions so that I’m investing in the traditional 401k and taking the tax break now instead of at retirement.
Use Open Enrollment to Review Your Benefits and Make Changes When Necessary
The biggest changes at open enrollment always seem to be with the medical plans. Based on your current situation and what might be happening in the next year you might want to make changes. You can’t plan for all health situations but things like having a baby or known changes in your health can determine which health plan might be better for you.
For myself I can make changes to my 401k plan anytime but this time of year is a good reminder that I should look at it and make changes. If you are invested in a target date fund then you can just let it ride and let it do its thing, but if not you should set a certain time of year where you review your plan. It is also a good time to change how much you might be contributing to the plan if it is not set to automatically increase.
How does your benefits compare? Do you get a match from your employer for retirement? Are your medical insurance premiums going up this year? Don’t forget to comment below the original post, sign up to receive future posts by email and share with your friends!
Also, check out these articles on benefits:
What’s a Flexible Spending Account
Is a Health Savings Account for you?
