October 17, 2019
Fall is typically when employers announce any benefit plan changes for the coming year and ask employees to review their coverage and request any coverage changes.
Please don’t make this potentially costly mistake.
Confirm you are getting the maximum company match for retirement.
If you changed jobs this year and were auto-enrolled into the company’s retirement plan, there’s a good chance you are not contributing enough of your salary to earn the biggest possible match from your employer. Boost your contribution level to whatever it takes to earn the maximum match. That is free money you don’t want to pass up.
Check if there's a Roth option in your retirement plan.
If you habitually ignore all the emails from HR and your retirement plan, you may have missed the news that the plan added a Roth 401(k) option. Many employers have been adding a Roth 401(k) option to their standard traditional 401(k) offering. If your plan offers a Roth 401(k), I strongly recommend you consider putting your retirement saving in the Roth 401(k). Yes, you lose the upfront tax break on your contribution, as Roth 401(k) contributions come from your after-tax paycheck. But, over the long term, that can pay off big time. In retirement, withdrawals from your Roth 401(k) will be tax free. Withdrawals you make from a traditional 401(k) will be taxed as ordinary income.
Review your health insurance.
Don’t focus solely on your monthly premium. That may rise a little bit in 2020, but the bigger concerns should be changes to your deductible and the amount of co-insurance you owe when you actually use your insurance.
Don’t rely on the free group life insurance.
If you were married or your family grew this year, your need for life insurance likely has grown. The coverage offered as a free benefit through work is not nearly enough. Typically, that coverage provides a death benefit that is equal to a year’s salary. You need much more than that, and my recommendation is to buy more term life insurance outside of work. As I explained in this earlier post, it’s not hard (or expensive) to protect your family.