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Financial Planning

Your Benefit Solutions: The Employee’s Guide to Open Enrollment Season

Catherine Tsai

Why It Matters:

  • During open enrollment season, you can opt in to employee benefits for the upcoming year.
  • Some employers expanded workplace benefits during the COVID-19 pandemic, so you might have more options to review this year.
  • Benefits are part of employee compensation packages, so review them carefully so you can enjoy what you’ve earned.

Open enrollment season is here, and thanks to COVID-19, it’s bound to be a little bit different in 2021.

Open enrollment season is that time of year when workers can (and should) review their employee benefits, including health insurance benefits, retirement benefits, and more. You can confirm choices for coverage or make changes.

It’s important to set aside time to review your workplace benefits because for certain benefits, it’s generally the only time to opt in or make changes for the upcoming year unless you have a life-changing event like a marriage, birth in the family, or job change.

There’s one more reason that the open enrollment season this fall is particularly important. Over the last year, some employers expanded benefits, not only to help employees deal with the mental, physical, and financial strains of the pandemic but also to attract and retain staff.1 That means it will be more worthwhile than ever for employees to review or update the benefits they’re electing.

Reviewing what’s included in your employee benefit plan

An employer’s decision on what to include in an employee benefits package can vary based on the organization’s size and what’s typical for its industry, but benefits might include:

  • Paid time off (PTO), including vacation time or sick leave
  • Health insurance
  • Workers’ compensation
  • Pet insurance
  • Vision and dental
  • Health savings account or flexible spending account (offered by about half of employers who offer health insurance as a benefit, according to the Transamerica Institute®)
  • Retirement benefits like a 401(k) plan or 403(b)
  • Student debt relief
  • Supplemental health or life insurance

And that could be just the beginning. Check with your employer to see exactly what’s available to you and your family for 2022.

5 questions to ask about health insurance benefits

Be sure to consider your company’s employee health plans during open enrollment season. Some employers require employees to actively opt in to coverage each year — or else they won’t be covered in the coming year.

Given that PwC predicts the costs of treating a patient will rise in 2022, that’s not a mistake you want to make.2 Review what options for health coverage are available to you as an individual or as a family. Some questions to ask:

  1. What are your out-of-pocket costs for coverage under your employer’s plan? Consider premiums, deductibles, and copays.
  2. If you’re healthy and have low medical expenses, could a high-deductible plan make more sense for you?
  3. What sort of medical expenses are you anticipating this year? If you deferred healthcare in 2021 due to the pandemic, let your exercise routine slide, or slipped into bad habits, then 2022 may be the year to get back on track and schedule regular checkups. It’s also possible that neglecting routine medical care in 2020 and 2021 could catch up with you in 2022 and mean higher medical expenses than usual. If you’re hoping to expand your family this year, that could also play into your expected medical bills for 2022.
  4. Are your medical providers considered to be in-network under your employer’s plan? Seeing an out-of-network provider will likely cost you more.
  5. Does your employer offer a flexible spending account3 or health savings account4? How much money, if any, should you set aside tax-free from your paycheck and put into an FSA or HSA for medical expenses?

Families may want to ask one more question:

  1. What is the cost of coverage for your family under your plan vs. costs under your partner’s plan? Does either plan limit coverage?

Consider how the answers to those questions can affect your finances and your health.

Are your retirement plans on track?

If you’re fortunate enough to work for an employer who offers a retirement plan like a 401(k) or similar plan, congratulations! Even employees of small businesses may have access to a retirement plan this year as business owners look for new ways to lure and keep workers in the wake of the pandemic.

"As employers recover and envision the post-pandemic workplace, they have the opportunity to enhance their benefit offerings,” Catherine Collinson, CEO and president of Transamerica Institute, has said. “The benefits marketplace is highly competitive, and employers may find new solutions within their reach. As a specific example, recent legislation has made it easier and more affordable for small businesses to start offering a retirement plan."

Retirement benefits tend to be more flexible in that employees can usually join an employer’s retirement plan and adjust contributions to it throughout the year, not just open enrollment season. But this time of year can be a good trigger to remind yourself to review your retirement benefits.

If your employer offers a 401(k), you can set aside a certain amount that you want to pull out from each paycheck — before any taxes are taken out of it — to put into your 401(k). The federal government caps how much you can contribute each year. The 401(k) contribution limit for 2021 was $19,500.5 (People over 50 could contribute an extra $6,500 above that cap in 2021 in what the IRS calls a “catch up contribution.”)

Some employers also offer the option of a Roth 401(k), which is funded with post-tax dollars. Contributing to one won’t lower your take-home pay for income tax purposes the same way that contributing to a traditional 401(k) would, but withdrawals in retirement are tax-free. (You would pay income tax when you withdraw money from a traditional 401(k) in retirement.)

A financial professional can help you determine how much you can afford to contribute to a 401(k) next year. If your employer offers a 401(k) match, meaning your employer will match a certain percentage of what you contribute to your own account, it could be well worth it to contribute at least enough to earn the maximum match.

A word on supplemental life insurance

Life insurance is one of those things we don’t necessarily learn about in school, and you might not even think about it until you have a family or move in with a partner. Most people buy it to ensure that if the worst happens, their loved ones can receive a payout to continue paying household bills after they have passed.

Your employer may include a life insurance benefit as part of your compensation, but is it enough? If the benefit is not enough to cover what you contribute to your household’s expenses, you may want to consider buying supplemental life insurance. That way your survivors will be able to afford the mortgage, for example, if you should unexpectedly pass. Consult a financial professional for advice specific to your situation.

Make the most of your workplace benefits

About 9 in 10 employees say benefits are important to their overall job satisfaction, according to the Society of Human Resource Management.6 Whether your benefits include PTO, a gym subsidy, year-end bonus, or free counseling services, review them regularly and use them.

You’ve earned it.

Things to Consider:

  • Be sure you’ve opted in to health coverage for the upcoming year if you want it.
  • Check whether your medical providers are in-network.
  • Review premiums, deductibles, and copays under your health insurance for the upcoming year.


1 “The Pandemic Prompts More Companies to Offer Paid Sick Time and Leave - but Millions of Workers Still Don't Get It,” The Wall Street Journal, September 2021

2 “Medical cost trend: Behind the numbers 2022,” pwc.com, July 2021

3 “Using a Flexible Spending Account (FSA),” HealthCare.gov, 2021

4 “Health Savings Account (HSA),” HealthCare.gov, 2021

5 “Retirement Topic - 401(k) and Profit-Sharing Plan Contribution Limits,” IRS.gov, November 2021

6 “What Benefits Do Employees Want Most,” Resourcing Edge, February 2019


Transamerica Resources, Inc. is an Aegon company and is affiliated with various companies which include, but are not limited to, insurance companies and broker dealers. Transamerica Resources, Inc. does not offer insurance products or securities. The information provided is for educational purposes only and should not be construed as insurance, securities, ERISA, tax, investment, legal, medical or financial advice or guidance. Please consult your personal independent professionals for answers to your specific questions.