Bruce Finley explains how employees can make the best possible choices in benefits packages.
Bruce Finley: You, as an employee, should look for a simple, straight-forward way for you to make your choices. Think about them in a kind of a hierarchy of choices. So, number one, should you participate or not and up to what level? On 401(k), that means the amount that you’re contributing. You certainly want to contribute up to the level, if you can, if your financial circumstances allow it, to get the full match from your employer. And if you need medical coverage, make sure you get that coverage and make sure people are covered within it.
Secondly, it’s how much does this cost you? So you need to figure out what it’s costing you and what you can afford every month. That is certainly important in how much you contribute to your saving plan, but it’s also true of which plan you choose for a medical plan. Often people over-insure themselves, if you will. They get a plan that’s maybe got too rich benefits compared to how much they’re using a plan. They might be better off with a simpler plan or an account-based plan that actually works better for them.
And then the next level is get the right way of participating, if you will. So put your investments into a good balanced program, and there are usually tools that will allow you to do that. It might be as simple as choosing one fund that’s a target-based fund and it self-invests for you. Likewise, on the healthcare side, know how you get the best reimbursement for the conditions that you’re going to be involved in and then using the calculators that show you what the right plan is for you and how to take advantage of it.
Once you make a few decisions like that and you prioritize them, you’ll be better off. And then all of the rich number of decisions that are out there, maybe you don’t focus on as much because you’ve made the really most important choices and done them correctly.
As an employer, you need to help your employees get involved in their decisions. And I mean by that most decisions for benefits are fairly emotional and you need to connect with your employees in an emotional way and make sure that they understand that the decision are important and the decisions can really help them out.
You’re going to lay out the options. That’s required. But doing it in a simple way and helping them to get involved, for example, enrolling in their savings plan and getting the right simple choice on what plan they should participate in, that is really important. And then if you can boil down your messages to some two or three messages -- so, get involved, make the right investments, follow-up once a year something like that that helps them know what they should focus on and in what regularity -- that’s really helpful to employees so that they can cut through the clutter that’s required because you have to provide every piece of information but get them focused on making the most beneficial actions for themselves and everybody in their family.
Directed / Produced by Jonathan Fowler & Elizabeth Rodd