5 Ways To Determine The Best “Company Benefit Package” For Your Family

by Kathy Sykes on November 26, 2012 · 0 comments

It’s that time of year where companies are opening up enrollment into their benefit options. With the price of healthcare still on the rise and our paychecks remaining the same (or decreasing), how do you determine which is the best option for you and your family.

Here are my top 5 things to consider when comparing options:

1. On average, how often do you or a family member get sick per year? Other than routine office visits, do you have anyone who has a chronic illness or is in and out of the hospital for specific reasons? If the answer is yes, then it is best to choose the top tier option that your company offers. You will pay more out of pocket on the front end, but it is guaranteed that you will pay less (on the back end) for those frequent doctor or hospital visits. When a family member is chronically ill and needs to see a doctor frequently, the last thing you need to be worrying about is how you are going to pay the bill. Try to use “in network” doctors if possible to also cut down on out of pocket costs. Remember prescription medication is covered under your health benefits, so if maintenance medications are needed (those needed for the rest of your life) your co-pay with the top tier option will be cheaper.

If it is determined that no one in your family gets sick on a regular basis or needs frequent care, I always recommend going with the mid-level care package. Why? Because life is unpredictable. It is better to be safe than sorry.

If you are a one income family and money is scarce, do not bypass health insurance. Getting the bottom tier coverage is better than no coverage. Less comes out of your pocket up front but if care is needed, you know that you can get it and worry about the bills later. Most healthcare facilities have payment plans that you can sign up for to take care of your obligations over time.

2. Do you need dental insurance? Yes. Dental insurance is relatively inexpensive these days and when you have a tooth ache, that is a pain that you won’t gone immediately. Sometimes  dental health gets pushed back on our priority list but if you maintain your teeth and gums appropriately with two cleanings and examinations a year and brush and floss regularly, you won’t have to use it as often and incur costs. This is especially important if you have children.

3. What about life insurance? Most companies pay for employee life insurance so that is a no-brainer. Should you add dependents or supplement? Yes. Again, life is unpredictable and during a time of death, you would be comforted knowing that the expenses can be paid for. At the very least, have enough to cover funeral costs. If you can, buy supplemental insurance to cover loss of wages for you and/or your family if you or your spouse passes away.

4. Should I contribute to 401K? In a perfect world (and with extra money) the answer would be yes. This is a way that you are planning for your retirement. In today’s time, retirement is a far fetched idea. Most people are concerned about the present and making ends meet instead of their future living expenses. If it is a 401K account or a personal savings, you MUST save for a rainy day. 401K accounts are great because your company matches your contributions at some level where that doesn’t happen with a savings. Money put into a 401K account is pre-taxed so you get more bang for your buck before the government touches it. That is a huge plus. 401K accounts automatically takes money out of your check and that may not be the ideal situation for you when money is tight. You must do what’s best for you at the current time. But bottom line…..SAVE SOMETHING!

5. Should I contribute to a flexible spending account (FSA)? This is a good idea if you are unsure that you will have enough money to cover “back end” expensive AND you know that you are not good at putting money aside. This money automatically come out of your check and you determine the total amount per year you want to add to it. So for example, if you choose to put  $250 and went to see the doctor in May that generated a $125 bill (because you chose the mid-level tier option), you would have you can pay the entire bill with your FSA or pay some in cash and pay the rest with FSA, saving money for your next healthcare expense. What is also great about FSA’s is that the money can be used for dependents as well.



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