Every year, workplace open enrollment gives employees an important opportunity to review their health insurance and other employer-sponsored benefits. However, it can be tempting to simply select the same options as last year and move on.
Your benefits may deserve a closer look. Health coverage, retirement contributions, insurance protection, tax-advantaged accounts, and other workplace programs can all play a role in your broader financial plan. As a result, understanding what your employer offers can help you make more informed decisions for the year ahead.
Quick Answer: What Should You Review During Open Enrollment?
During workplace open enrollment, review more than your health insurance premium. Consider how your benefits fit your current needs, family situation, financial goals, and expected expenses.
Depending on what your employer offers, your review may include:
- Health insurance coverage and costs
- Health Savings Accounts (HSAs)
- Flexible Spending Accounts (FSAs)
- Retirement plan contributions and employer matching
- Group life insurance
- Disability income insurance
- Long-term care benefits
- Dependent care benefits
- Legal services
- Student loan assistance
- Identity theft protection
- Other voluntary workplace benefits
Not every employer offers every benefit. Therefore, start with your current benefits package and compare it carefully with the options available for the upcoming year.
Why Workplace Open Enrollment Deserves Your Attention
Benefits can become easy to overlook when they automatically renew. Yet your life and finances rarely stay exactly the same from one year to the next.
For example, you may have gotten married, welcomed a child, changed jobs, received a raise, moved, or experienced a change in your healthcare needs. Any of these events may affect which benefits make sense for you.
Additionally, employers may change plan premiums, deductibles, copays, coverage limits, provider networks, or available benefits from year to year. Even if your plan has the same name, reviewing the details can help you understand what you are choosing.
Start With Your Health Insurance
Health insurance is often the first decision people think about during workplace open enrollment. However, comparing plans involves more than looking at the monthly premium.
Consider reviewing:
- Monthly premiums
- Annual deductibles
- Copays and coinsurance
- Out-of-pocket maximums
- Prescription drug coverage
- Provider networks
- Specialist coverage
- Emergency and hospital costs
- Coverage for ongoing medications or treatments
A plan with a lower monthly premium may require you to pay more when you receive care. Meanwhile, a plan with a higher premium may offer lower deductibles or copays.
Therefore, consider both your expected healthcare needs and the financial risk of an unexpected medical expense.
Understand How an HSA Could Fit Into Your Financial Plan
If you enroll in an eligible high-deductible health plan, you may have access to a Health Savings Account, or HSA. HSAs can offer valuable tax advantages while helping you prepare for qualified healthcare expenses.
An HSA can potentially provide three federal tax advantages: eligible contributions may be tax-deductible or made pre-tax, earnings can grow tax-free, and qualified medical withdrawals can be tax-free.
Additionally, unused HSA funds generally carry forward from year to year. That feature can make an HSA useful for both current healthcare expenses and longer-term planning.
However, HSA eligibility rules apply. Before contributing, confirm that your health coverage and personal circumstances meet the current IRS requirements.
Don’t Overlook Your FSA
A Flexible Spending Account, or FSA, is another benefit worth reviewing during workplace open enrollment.
An FSA allows eligible employees to set aside pre-tax dollars for certain qualified expenses. Depending on the plan, these accounts may cover healthcare, vision, dental, or dependent care costs.
However, FSAs operate differently from HSAs. In particular, unused funds may be subject to your employer plan’s carryover or grace-period rules. Therefore, estimate your expected expenses carefully before choosing a contribution amount.
Review Your Retirement Contributions
Open enrollment can also serve as a useful reminder to review your workplace retirement plan.
Consider whether your contribution rate still fits your financial goals. Additionally, check whether your employer offers matching contributions and whether you are contributing enough to receive the match available to you.
If your workplace plan offers both traditional and Roth contributions, review how each option is treated for tax purposes. Your income, tax situation, retirement timeline, and other assets may influence how you approach the decision.
Retirement planning does not happen in isolation. For more educational resources on retirement, investing, taxes, insurance, and financial planning, visit the Holland Strategic Wealth Advisors blog.
Take Another Look at Group Life Insurance
Many employers offer group life insurance as part of their benefits package. Some also allow employees to purchase additional coverage for themselves or eligible family members.
Employer-sponsored life insurance can be convenient. However, the amount your employer provides may not necessarily match your family’s needs.
During workplace open enrollment, consider how much coverage you currently have and what financial obligations your family might face without your income.
Those obligations could include:
- Mortgage or housing expenses
- Everyday household expenses
- Childcare
- Education costs
- Outstanding debt
- Final expenses
- Long-term financial support for dependents
Also, determine whether the coverage is portable. In other words, find out what happens to your policy if you leave your employer.
Consider Disability Income Protection
Your ability to earn an income may be one of your most important financial resources. Therefore, disability income insurance deserves attention when reviewing workplace benefits.
Short-term and long-term disability coverage can provide income protection if an eligible illness or injury prevents you from working.
However, coverage percentages, waiting periods, maximum benefits, and definitions of disability can vary. Review those details instead of assuming all disability plans provide the same protection.
Look for Benefits Beyond Health and Retirement
Your employer may offer benefits that are easy to miss because they receive less attention than medical insurance or a retirement plan.
For example, some workplace benefit packages may include student loan assistance, prepaid legal services, long-term care options, commuter benefits, identity theft protection, umbrella liability coverage, or discounted insurance programs.
These benefits will not apply to everyone. Still, workplace open enrollment provides an opportunity to find out what is available before deciding whether any of these programs could be useful to you.
Think About What Changed Since Last Year
Before renewing your benefits, compare your current situation with where you were a year ago.
Ask yourself:
- Has my income changed?
- Has my family changed?
- Do I expect significant healthcare expenses?
- Have my prescriptions changed?
- Am I contributing enough toward retirement?
- Do I have adequate life and disability coverage?
- Are there benefits available that I am not currently using?
- Have my short- or long-term financial goals changed?
These questions can turn workplace open enrollment from an administrative task into a more useful financial check-in.
Compare the Numbers, Not Just the Plan Names
Choosing the same plan year after year may feel convenient. However, plan details can change.
Compare the new materials with your current coverage side by side. Pay particular attention to premiums, deductibles, copays, out-of-pocket maximums, prescription costs, and coverage limitations.
Additionally, review any notices that explain benefit changes. A relatively small change in a deductible or prescription benefit could matter if you use that service frequently.
Connect Your Benefits to Your Broader Financial Strategy
Your workplace benefits are one part of your overall financial picture. Therefore, decisions about healthcare, retirement savings, life insurance, disability protection, and tax-advantaged accounts should not necessarily be viewed separately.
For example, increasing an HSA contribution may affect your monthly cash flow. Increasing retirement contributions may affect both your take-home pay and long-term savings. Meanwhile, changing insurance coverage may alter the amount of protection available to your family.
Looking at these choices together can provide a clearer picture of how your benefits support your financial priorities.
Make Open Enrollment a Yearly Financial Checkup
You do not need to completely overhaul your benefits every year. In fact, after reviewing your choices, you may decide that your existing selections still fit your needs.
The important part is making that decision intentionally.
Workplace open enrollment provides a natural annual opportunity to review your coverage, identify changes, and consider whether your benefits still align with your life and financial goals. A thoughtful review now can help you enter the coming year with a clearer understanding of what you have and how it works.
Frequently Asked Questions About Workplace Open Enrollment
What is workplace open enrollment?
Workplace open enrollment is a designated period when eligible employees can review and make changes to employer-sponsored benefits. Depending on the employer, options may include health insurance, dental and vision coverage, retirement benefits, life insurance, disability coverage, HSAs, FSAs, and other voluntary benefits.
Should I review my benefits even if I want to keep the same health plan?
Yes. Reviewing your benefits can help you identify changes to premiums, deductibles, copays, prescription coverage, provider networks, or other plan provisions. Additionally, changes in your own life may affect whether last year’s choices still meet your needs.
What is the difference between an HSA and an FSA?
Both accounts can offer tax advantages for eligible expenses, but they operate differently. HSAs generally require enrollment in an HSA-eligible high-deductible health plan, and unused funds can remain in the account. FSA rules depend on the employer’s plan, including provisions for unused funds.
What other benefits should I check during open enrollment?
In addition to health insurance, consider reviewing retirement contributions, employer matching, life insurance, disability coverage, dependent care benefits, legal services, long-term care options, and any other voluntary benefits your employer offers.
Can a financial professional help review workplace benefits?
A financial professional can help you consider how certain workplace benefits relate to your broader financial goals. However, benefit availability and plan provisions vary, so you should also review your employer’s official plan documents before making enrollment decisions.
Holland Strategic Wealth Advisors offers insurance products and services. We are not affiliated with any government agency and do not provide tax or legal advice. This information is for educational purposes only and should not be construed as advice or a recommendation specific to your situation. Insurance product guarantees are backed by the financial strength and claims-paying ability of the issuing company. Insurance product and feature availability may vary by state.
