Top 5 Benefits Open Enrollment Must-Dos

The open enrollment benefits period is the one time of the year employers allow you to make changes to your benefit elections with very few questions asked.  Take advantage of it.

It’s not uncommon for our own benefit elections to run on auto pilot rolling over each year.  Take a few minutes to run an audit. You could save yourself money and heartache down the road.  Prepare yourself by reading the benefit communications your company prepared for open enrollment.  Learn what’s new, what may be going away next year and whether there are any significant changes that will impact you or a covered family member financially.

Review your current elections

Do you still need the same medical or dental plan?  You may have elected the higher cost dental plan last year when you needed that root canal, but now you’re only in need of periodic cleanings.  Downgrade to a lower payroll contribution plan.   Maybe your company is now offering a new cost-effective medical plan.   Take inventory of all benefit elections to confirm whether you still want or need them, or whether there are any other benefits you’re not enrolled in that would be of value to you.

Remove or add any dependents

Are you still carrying an ex-spouse or child over the age of 26 on your health plans?  While the age limitation to cover children may vary by state, you may need to actively drop that ineligible child (or ex-spouse) which could decrease your payroll contributions.   Unless you have a mid-year life event such as a marriage, divorce or birth, you can only add a dependent during the open enrollment period.

Change Recurring Contributions to Savings Accounts

Flexible spending accounts and health savings accounts usually start off as an annual goal election with periodic, consistent payroll contributions made over the course of the year.  Over time, funds accumulate in a special account that can only be used under specific conditions without tax implications or penalty.

Health care flexible spending account plans may allow for unused funds to carryover from one year to the next, but often there’s a limit to how much you can carry over. Check with your employer on what your plan rules are as they can vary.  If you no longer need to save pre-tax contributions for a rainy day, stop the election.

Health savings accounts allow you to rollover all of the unused funds, and even take them with you if you leave a company.  If you have extra cash to save, contributing up to the IRS maximum into your health savings account is always a safe bet.

Dependent care flexible spending accounts (earmarked for child care and adult care expenses) don’t allow for the carryover of unused funds from one year to the next. This is the epitome of the “use it or lose it” rule.  If you no longer have a child in day care, stop contributing.

Update Beneficiaries

Life insurance plans and health savings accounts enable you to designate a beneficiary which can ensure a smooth payout of any financial payout to whomever you wish such after you’re gone.  Priorities and situations change impacting who may be entitled to your assets.  Did you get divorced and forget to change your beneficiary?   Assigning a beneficiary ahead of time can eliminate the need to go through probate or any legal process.

Submit your open enrollment elections by the due date

Rules are rules. However, many companies may offer a silent or change window for up to several weeks after the initial open enrollment period.  Technically, the law is a bit fuzzy on this, but an employer can allow you to make a change to your benefit elections for the next calendar year as long as the elections are submitted by December 31 of that year. If you missed the official window, make the case to your employer and stress any financial hardship to persuade them.  Companies need to be seen as behaving fairly and equitably to all employees.

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