Take Advantage of All the Benefits Your Employer Offers

Health insurance.

If you are lucky enough to work for an employer who pays the whole premium for an individual health insurance policy, make sure you sign up. As healthcare costs rise each year, companies are cutting back on the amount of the premium they will pay for, which means you pay the difference. Health insurance is an excellent benefit, even if you have to pay a portion of the cost. Just one emergency room visit to set a broken limb could cost you hundreds of dollars you would have to pay for if you don’t have insurance. And, if you have a family, you know how much doctors’ visits and medicines cost each year for the kids.

If your employer only pays a portion of the premium, do the math to find out how you could save money on this benefit. Find out how much your insurance will cost out of your paycheck and compare that to what your spouse’s employer will pay for on that plan. In most cases, it’s cheaper for both of you to have an individual plan from each employer rather than an employee/spouse plan from one. Compare what medical costs are covered on both plans- one plan may cost a lot less because it offers less.

If you need family coverage, compare costs from both employers to see which plan will save you money. It’s rare that a company will pay the full premium for family coverage, but if one does, it’s a no-brainer to sign up for that insurance.

Flexible Spending Account.

This is a great way to lower your taxable income and therefore pay less tax on April 15th. Think of a Flexible Spending Account as a savings account for your medical expenses. Even if you have health insurance as discussed above, you will always have out of pocket costs throughout the year- for office visit co-pays, prescriptions, eyeglasses or contacts, and dental visits. You can even submit expenses for some over the counter drugs such as for cough and cold, as well as saline solution for your contacts.

You add up what you think these costs will be during the year, sign up for this benefit, and that amount is deducted from each check on payday (your annual election divided by the number of pays per year). As you incur these out of pocket expenses, you submit a form and copies of your receipts to a Plan Administrator who will reimburse you from the funds that have been withheld from your paycheck. You can even submit expenses for dollar amounts that you haven’t even paid into the account yet! In other words, you can have a dental check-up on January 2nd, submit the bill for reimbursement, and get your payment even before that amount had been deducted from your first paycheck of the year.

There are two very important points to beware of here. If you don’t use up all of the money you’ve elected during the year, you cannot carry it over into the next year, and you will lose it. Also, if your employment terminates during the year, you can only file claims for those expenses that you incurred while you were working for the company. So, be sure to be conservative in your figures when deciding on your annual election, and if you have any idea you might quit your job or be laid off, make sure you use up that money before your last day.

401(k).

Everyone should save for retirement, but if your employer offers a match on the amount you contribute to your 401(k), be sure to get this free money! Remember- when you participate in your employer’s 401(k) plan, that money is deducted from your check before your taxes are calculated. So, just as with the Flexible Spending Account, you are reducing your taxes and paying less to Uncle Sam. It may seem hard to try to save this money, but any amount that you can contribute from each paycheck will get you closer to being comfortable in your retirement. Plus, the sooner you start to save, the more time your money has to grow.

Remember, when you work for a company, any benefits they offer are in addition to your salary, so be sure to take advantage of all that you are entitled to.

About the Author

Kathy Swann has over 25 years experience in office administration, payroll and Human Resources. Her e-book "How to Win When You Lose Your Job: A Handbook for Those Soon to Be Unemployed” was written to help employees understand what benefits are available to them should they lose their job through no fault of their own. Purchase this e-book at http://www.loseyourjob.net