5 Employee Benefits New Year’s Resolutions You Should Make
January 8, 2020
Last week, the New Year’s Eve ball dropped in Times Square. You’ve reflected on all that you’ve accomplished in 2019. You’ve hung up your 2020 wall calendar. So what’s next? For 60 percent of people, it’s New Year’s resolution season. Not surprisingly, health and wellness are two of the more common topics for people who set New Year’s resolutions. In the spirit of the new year, we want to provide you with some goals you can set that are both helpful and achievable so that you can get even more out of your employee benefits in 2020.
Max out your HSA
The average participant contributes $1,872 to their Health Savings Account (HSA). Even if your employer contributes $839 (the average contribution for those who contribute, according to Devenir), your account is still short of what the IRS allows for HSA individual contributions each year (the 2020 HSA limits are $3,550 for individuals and $7,100 for family).
If you’re able to contribute more to your HSA, it makes financial sense to do so. These accounts are individually owned, and all funds carry over from year to year. That makes HSAs valuable as both a spending and a savings tool. And, with an HSA, you can adjust your contributions at any time during your plan year.
Invest your HSA funds
Would you let your 401(k) funds go uninvested? Of course not! The majority of HSA participants do not invest their HSA funds, even though history shows that the expected rate of return on mutual fund investments is much higher than an HSA’s standard interest rate. An HSA rivals a 401(k) and an IRA for its investment and retirement-planning potential.
We enhanced our HSA investment experience to expand your investment options and to give you direct access to the tools and resources you need to invest. If you’re among the 61 percent of Americans who feel investing is “scary or intimidating,” check out some of the tools we make available to help you feel comfortable and secure in the investing process.
Take advantage of employer HSA and 401(k) matches
Does your employer offer a match of your 401(k) and/or HSA contributions each year? Most employers match a percentage of 401(k) contributions, while two-thirds of employers contribute money to employees’ HSAs or Health Reimbursement Arrangements (HRAs). At the very least, consider contributing enough to your 401(k) and HSA or HRA to collect the employer matches on those accounts, since that’s basically free money you can use for your healthcare and/or retirement-planning needs.
Spend down your FSA funds
If you participate in a Flexible Spending Account (FSA) that aligns with the calendar year, then December 31 was the last day of your plan year. However, many FSAs have a grace period, which can give you up to an additional 2½ months after a plan year ends to incur expenses. Since FSAs are a use-or-lose account, you should resolve to take a look at your FSA balance, see when your plan year ends and spend down your FSA balance before your plan year expires.
Get educated about your benefits
A lack of understanding in the differences between employee benefits offerings is often a big participation barrier. For example, a recent WEX Health report found that half of employees surveyed needed help making sense of health jargon. And 50 percent also said they had trouble understanding the differences between all of the health spending accounts.
If you’re interested in learning more about the basics of an HSA, FSA, HRA, Commuter Benefits and other employee benefits options, check out:
- Our blog posts that compare and contrast an HSA versus an FSA, an HSA versus an HRA or an FSA versus an HRA.
- Our Employee Resource Center, which has a number of guides, handouts and tools to help you learn more about our available benefits.
- The Benefits Buzz podcast. Our first season included an open enrollment series that highlighted the basics of common benefits plans.
- Our Discovery Answers™ knowledgebase, which has a searchable database of help articles so you can learn more about your plans. You can find Discovery Answers™ within your online account by clicking “Get Help.”
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Please note: Discovery Benefits cannot provide investment advice and encourages its participants to seek guidance from a financial adviser for help with investment decisions.