Popular Employee Benefits and How You Can Save With Each

August 11, 2020

Open enrollment will be here before you know it! And your employer could be looking for ways to boost their employee benefits by enhancing existing plans or providing you with new savings opportunities. All of that means one thing for you: choice. With so many potential options available, how do you know which plan is right for you? We kick off our 2020 open enrollment blog series by outlining the basics of popular employee benefits plans. 

HSA

If you’re interested in participating in a health savings account (HSA), you’re not alone! The number of HSAs has more than doubled in the last five years. And, during that time, HSA assets nationwide have nearly tripled. 

So why the buzz around HSAs? It’s simple. Contributions are tax-free, earnings are tax-free and withdrawals for eligible expenses are tax-free. And the investment potential of an HSA is as good or better than what you’ll find using other long-term investment tools such as a 401(k) or an Individual Retirement Account (IRA). So, if you’re looking to save money on healthcare expenses and/or boost your retirement planning, HSAs are the perfect account. Please note: You must be enrolled in a high-deductible health plan (HDHP) to be eligible for an HSA. 

FSA

When you participate in a flexible spending account (FSA), you set aside a set amount of funds (determined by you) before they are taxed which can later be spent on eligible expenses. There are four common types of FSAs: 

Please note: You can’t participate in an HSA and a general-purpose medical FSA. However, you can pair an HSA with a limited FSA, combination FSA or dependent care FSA. 

HRA

Health reimbursement arrangements (HRAs) are employer funded and employer owned. They’re generally used as a way for your employer to provide financial assistance for you to pay for eligible expenses. HRAs are also completely customizable by the employer, so make sure to check which type of HRA is being offered and what expenses are covered before evaluating how well it works for you. Check out this blog post to learn more about common types of HRAs. 

LSA

Lifestyle spending accounts (LSA) are also completely employer funded and employer owned. However, LSAs differ from HRAs in that LSAs are funded by your employer after funds have been taxed. Because there are no tax restrictions on how the funds may be spent, eligible expenses for an LSA can be anything your employer decides as a way to meet your needs. LSA eligible expenses typically fall into three wellness categories: physical, financial and emotional. 

Commuter Benefits

Would you believe the average one-way work commute in the United States is nearly a half-hour? And it’s a spendy 30 minutes, both for your mental wellbeing and your bottom line. By participating in commuter benefits, you can save 40 percent or more on eligible commuting costs, which can include mass transit, vanpooling and parking. These plans let you set aside pre-tax dollars to pay for expenses related to your work commute. And you can change how much you contribute at any time. 

For the latest on your employee benefits and to keep up with our open enrollment series, subscribe to our blog today!

Benefits Breakdown


HSA

FSA

HRA

LSA

Commuter Benefits

Who owns the account?

You do

Your employer

Your employer

Your employer

Your employer

Who funds the account?

You and/or your employer

You and/or your employer

Your employer

Your employer

You and/or your employer

Are contributions taxed?

No

No

No

Yes

No

Can I invest funds?

Yes

No

No

No

No

Do funds carry over from year to year?

Yes

Determined by your employer (IRS allows up to a $550 carryover)

Determined by your employer

Determined by your employer

Yes

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