Happy Thanksgiving! I hope you’re enjoying your weekend. We spent the weekend visiting with extended family. My children also enjoyed a visit to Canada’s Wonderland with their dad, grandfather, and uncle. After almost tossing my cookies at the Carp Fair a few weeks ago, my ride days are sadly over!
As 2013 is drawing to a close in a few months, it’s a great time to start looking at year end issues – before the craziness of Christmas starts up. If you have time before turkey today, you may want to look at the details of your extended health benefits. I realize that this isn’t the most exciting thing to do, but it can save you a lot of money for a relatively minor investment of time.
Do you have any unspent funds left?
Many plans offer a maximum amount per calendar year for various types of health practitioners not covered by provincial health plans, like Naturopathic Doctors, Nutritionists or Dieticians, Psychologists, Chiropractors, Speech Therapists, etc. Do you plan to use any of these services in the near future? NOW is the time to book. If you wait until December, chances are they will be fully booked already. I made this mistake myself last year. In December, I decided that I had exhausted all my other options with back pain and it was time to see a chiropractor. By the time I made the call to set up an appointment, the one that I wanted to see was fully booked until Christmas Eve and was taking the week between Christmas and New Years off (the nerve!). I ended up going in for an assessment in January. I quickly used up my 2013 maximum and have paid the rest out of pocket. If I had just gotten my act together a month earlier, I probably could have saved myself $500. I would have used my 2012 and my 2013 amount without interrupting my treatment plan. Because of my own stubbornness, my 2012 amount fell off the table (or rather came out of my wallet). I would tell you to call today, but it’s a holiday. So, call tomorrow! Even if you don’t go in for the appointment for a few weeks, at least it’s booked.
Do your plan options still make sense?
Every employee benefits package is different in the particulars, but usually there are 3 major areas of possible coverage: Life insurance, disability insurance, and extended health (medical/dental). If you’re fortunate enough to have coverage in all 3 areas, be grateful. That is not the norm any more. Whatever your coverage situation, you want to make the most of what you have.
Many companies are now offering flex benefits where you have 3 options in each area mentioned above: standard coverage (middle of the road approach), enhanced coverage (usually requiring the employee to fund part of the cost out of his or her paycheque in exchange for better reimbursement rates), or basic coverage (where the employee gets money back to apply to other areas if they don’t need a particular option). When these plans are first introduced, employees will usually look through the details and decide what makes sense at that time. They may choose to cut back on extended health because they have coverage through a spousal plan and apply those funds to extra life insurance instead. Or they may choose the standard coverage for everything. It’s good practice to review those choices on an annual basis to make sure they still make sense.
First, check when you can change your coverage options. It may be annually, every two years, or at a life event (like a marriage, birth of a child, etc). If you’re able to change your coverage now if you want to, then it’s time to crunch the numbers. If you can’t, then there is no point in doing any more work. Put the next possible change date on your calendar and crunch the numbers then.
If a change is allowed at the beginning of the next calendar year, now is the time to crunch some numbers. Is your child going to need braces within the next few years? Check that dental coverage and see if going with the enhanced option makes sense. Finished with physio after that sports injury last year? Maybe you don’t need the enhanced coverage any more and can save yourself some money that way. Check the details of what you’re getting and how much it’s costing you. Maybe your choices still make sense, or maybe they don’t. Make the most of what you have!
You may notice that your employer is requiring you to fund the entire amount of your disability insurance. There are tax reasons that make this set-up the most beneficial for you. If you have paid for the policy yourself, the proceeds should be tax-free if you are ever required to collect. If the employer is paying for the policy, the proceeds will be taxable. A huge difference!