Today marks the beginning of the time of year where so many of our spending habits AND eating habits change dramatically. As a result, it can be scary to look in your bank account and on the scale! Just yesterday I went out of my way (25 minutes to be exact) to visit a local apple orchard. I walked out with not 1 but 3 bottles of syrup: Pumpkin Spice, Apple Butter, and Peach Cobbler! So what if I love my protein pancakes! Don’t judge me! This purchase made my day or hopefully my entire winter season if I plan it right! Yes, I did come out with some delicious apples too, but let’s be clear I came for that syrup!
Our finances are another part of our lives that change from October 31st to January 1st. Many people spend money on tons of candy to hand out to eager children disguised as their favorite character. Then we begin spending money on a Thanksgiving feast that we have anticipated for approximately 364 days. And less than 12 hours after that meal millions of shoppers begin their quest to find the perfect gift for everyone on their list and probably a few items for themselves. This time of year is simply expensive. And you could get caught unaware of all that is happening to your bank account if you don’t pay attention. Stay tuned to my next newsletter for an exciting opportunity to learn how to manage this season.
In addition to the fall spending fiasco, we are making benefit choices because it is open enrollment season. Companies across the nation are sharing health care and other benefit offerings available at work and you get to choose. For many, the cost of health care is astronomical. Sometimes the choice isn’t clear what you should do and why. Here are a few guidelines as you consider what options to elect for 2019.
Review your health care spending for the last 12 months. When you add up all your family had to pay out of pocket you can look at your choices with clarity. A healthy family of 4 who doesn’t go to the doctor very often or only for preventive maintenance may be able to handle a higher deductible. A single person with lots of medical expenses may want to look at a PPO with a higher premium because they know the out of pocket costs will be less on that plan. No matter what your situation is, having a clear total of your out of pocket spending is a great place to begin.
Understand if it makes sense to put funds for medical expenses in a flexible spending account or health savings account. These funds are pre-tax dollars only to be used for health care. But if you only spend $500/year do not put more than that in the account. Typically, the flexible spending account funds will go away on Dec. 31st. The health savings account will continue to grow if you don’t use it.
If you have day care costs it might we worth your while to put pre-tax funds away for those expenses. A family who spends $5,000 on child care could save $1,000 if their effective tax rate is 20%.
Calculate your need for life insurance. You may want to max out what is available at work because it might less expensive than buying term life insurance outside of work.
If you are planning to have a child in 2019 it might be good to review your disability and maternity coverage with your company plan. When I was pregnant I paid a higher premium for disability coverage, so I could have more take-home pay during maternity leave.
If you know you will have some expensive dental work to do next year consider the advantages of a plan that pays a higher percentage of the costs.
For self-employed persons or anyone who has a high out of pocket health care premium at work (over $200 per family member) you may want to consider other options. Medi-Share is a health care sharing community that could be a great alternative for many. Everyone pays an annual household portion, members submit their medical bills to Medi-Share for payment, and the bills get paid by the Medi-Share community. If you are a Christian looking for an alternative biblical solution to paying for health care you may want to check it out by clicking here.
This time of year doesn’t have to break the bank or stress you out. And it doesn’t have to be scary! Make a plan and stick to it. Slow down so you can make informed decisions. Give yourself the opportunity to enjoy this season and prepare for 2019.
If you want to discuss your options with me check out my calendar to find a time that works for you.