What You Should Know for Your First Open Enrollment
Open enrollment is taking place across the United States, and like millions of workers, you must submit your choices by a certain deadline. Many younger employees, however, are unsure about what types of coverage to select and how much and are tempted to wait until the last minute. This can lead you to decisions you may regret and financial setbacks.
Instead, take a minute to explore why benefits deserve your full attention and how to make the right choices.
Why Benefits Are Worth Your Attention
It’s tempting to procrastinate about benefits enrollment and you’re not alone. According to a recent MetLife survey, among young respondents (ages 21-38), about one in five spend only a few minutes reviewing benefits choices before making selections. And nearly half said they dread making annual benefit enrollment decisions equally as much as asking for a raise.
There are many reasons why you should think carefully about your benefits, including:
Benefits are part of your total compensation package. In fact, according to the Bureau of Labor Statistics, for every $2 employers spend in wages and salaries, they spend an additional $1 in benefits.
- . Many employers are investing in their employees through generous benefits programs in order to attract the best employees, so you should take advantage of all they offer you.
- Unexpected illness and accidents CAN happen. Per the Council for Disability Awareness (CDA), more than one in four of today’s 20-year-olds can expect to be out of work at least a year before they reach retirement age. This underscores why benefits like disability insurance are critical.
- Benefits protect your savings. Most experts say people should have enough money to cover three to six months of living expenses if you’re unable to work, yet according to The CDA, only about half of adults in the U.S. have enough to cover just three months. In the MetLife survey, more than a quarter of young respondents said they could barely cover two weeks. Benefits help reduce financial burdens and anxiety, keeping money in your pocket.
How To Make the Right Choices
Especially for employees early in their career, being thoughtful about open enrollment can make the difference between achieving short- and long-term financial goals and pushing them off.
- Assess your personal situation. Take an honest look at your lifestyle, health, family history and more before making selections. Consider your financial goals that could be thrown off by unexpected expenses. Many employers offer legal services, for example, that help reduce the cost of hiring a lawyer for speeding tickets, wills or landlord disputes.
- Have meaningful conversations. Talk to trusted friends, colleagues or family for advice. MetLife’s survey found that just one-quarter of young people asked for advice from a friend before making benefit decisions. Conversations with people you trust can help you understand the personal value of benefits and provide insights you haven’t considered on how they relate to your life.
- Do the research. Carefully read the full benefits package, as well as any additional material your employer may have available, such as videos and online guidance tools. You might be surprised about new offerings, or what existing options cover. For example, disability insurance might support mental and emotional illnesses, and some companies may offer auto and home insurance, or tuition reimbursement.
The bottom line is that employers offer benefits to stay competitive and help employees thrive. It’s up to employees, however, to make the most of the package to achieve their goals. By paying attention to your package, you can select the right “sweet spot” of benefits to build a better life.