LPM Staff

Taking charge

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One of the unintended consequences of the media frenzy over Health Care Reform has been that employees are paying more attention to their employer-sponsored benefits. Not a bad idea.

Meeting with human resources to re-evaluate your options may save you money, and may even contribute to your physical and financial wellbeing.

Wellness programs

At a time of reduced job security, wellness programs provide a spark of goodwill and foster self-responsibility. In addition to reducing demand for medical services, wellness programs provide economic benefit by reducing absenteeism, reducing on-the-job injuries and workers’ compensation costs, and reducing disability-management costs.

Wellness programs also help to recruit and retain the most effective, productive employees. Studies demonstrate a strong correlation between employees who seek out corporate wellness programs and productivity. These programs also often boost morale and promote team-building. The are an inexpensive way to show employees the organization is interested in them as total persons.

Weather it’s free flu shots, smoking cessation, or fitness programs, make sure you become informed and know where to find the information you need in order to participate.

Supplemental insurance

Unexpected accidents and illnesses happen. When they do, it can leave employees and their families vulnerable to out-of-pocket expenses that standard health insurance doesn’t cover.

Accident, disability, life, and catastrophic insurance are all available under supplemental health insurance and are fully portable. In other words, if you switch jobs, they go with you.  Policies can provide anthing from aid wth deductible fees from traditional health insurance for visits to the ER and X-rays, to a stipend based on income for maternity/paternity leave.  However, some policies require a full year of coverage before you can access certain benefits, so make sure you understand the policy, its caveats, and ask HR if you have any questions.

“A lot of people don’t take advantage of supplemental insurance,” says Matt Khoury, Executive Vice President of Bamboo Financial in Scottsdale. “But, in the long run, it is cost effective to take supplemental insurance. It is cheaper than going outside what the employer offers.”

Flex spending accounts

A flexible spending account (FSA), as they are commonly called, is one of many tax-advantaged financial accounts that can be set up through an employer cafeteria plan. FSAs allow employees to set aside a portion of their earnings to pay for qualified expenses as established in the cafeteria plan, most commonly for medical expenses but often for dependent care or other expenses. Money deducted from an employee’s pay for an FSA is not subject to payroll taxes, resulting in a substantial tax savings. The most common is the medical expense FSA, which is similar to a health savings account or health reimbursement account.

Retirement accounts

Not too long ago, employer-sponsored 401(k) programs were common. While some companies have suspended the matching program, some continue to offer it. Khoury stresses that benefits are value-added and part of an employee’s salary.  By not taking advantage of them, employees are giving themselves a pay cut.

The investment advisory firm Financial Engines, surveyed nearly a million 401 (k) participants in 2008; they found that 33 percent of the articipants don’t contribute enough to their company plan to collect the maximum employer matching contribution.

“It’s a matter of finances. Some companies match contributions up to a certain percentage or dollar for dollar.  gain, take advantage. It’s free money.”

In other words, don’t be penny wise and pound foolish.

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