Open enrollment is coming to an end. But there’s still time to take advantage of everything that the open enrollment period at your workplace has to offer.
Here are just seven things you should consider doing during open enrollment to build a stronger financial future.
1. Check Your Contributions
Not sure how much you’re contributing toward your retirement? Open enrollment is a great time to increase your contribution to your 401(k). Even if your employer only provides a matching contribution of up to four percent of your salary, it’s still a good idea to contribute more toward your retirement.
2. Meet Your Match
Are you contributing enough to take advantage of your employer’s matching contribution to your retirement plan? Many employers match fifty percent of employee contributions up to the first six percent of salary. So, if you’re only saving three percent of your salary, you’re missing out on half of the match. Take this time to check your employer match details. Meeting (or exceeding) the match helps ensure that you’re getting the most benefit from your 401(k).
3. Get Caught Up
Feel that you’re falling behind with your retirement savings? Take advantage of catch-up contributions. For example, the year you turn fifty, you’re allowed to set aside more of your salary tax-free to help fund your retirement.
4. Update Your Beneficiaries
If something were to happen to you, would the right person receive your 401(k) or other retirement plan? During open enrollment, it’s a good idea to check your beneficiary designations to make sure that your loved ones will receive what you’ve set aside.
5. Upgrade Your Insurance
Open enrollment is the ideal time to check your level of coverage to make sure you’re covered at the right level for you and your family.
6. Consider an HSA
During enrollment, you may want to sign up for a Health Savings Account (HSA). If you enroll in a qualified high-deductible health care plan, an HSA can be an important way to help offset some of the higher costs of health care. It also provides a triple tax advantage. Your contributions are tax-deductible, interest earned is tax-free, and you can make tax-free withdrawals for qualified medical expenses. Best of all, you keep your money regardless of whether you leave your current job, and the funds are yours to spend up to and beyond age 65.
7. Add a DCFSA
Expecting a bundle of joy? Want to set aside money to help care for an aging parent? During enrollment, sign up for a Dependent Care Flexible Spending Account (DCFSA). A DCFSA is a pre-tax benefit account used to pay for eligible dependent care services, such as preschool, summer day camp, before or after school programs, and child or adult daycare.