2019! A new year! A new you! At least that’s what I manage to convince myself of in January every year. I always seem to start off with that invincible feeling. I can do this! This year will be different! Whether it is 2 weeks later or 2 months later, the excitement and drive seem to fade away.
As we all know, January 1st also means the start of a new benefits year. Although, we generally associate resolutions with dieting and exercise, saving more money has ranked a close 3rd in resolutions for 2019 (Ballard, 2018).
The challenge is that open enrollment was 3 months ago. What do you do if you want to update something in your finances now? Do you have to wait until next open enrollment? One of the best kept secrets at the University of Michigan is that most of your benefits are NOT subject to open enrollment. Here are a few of those changes that you have the freedom to update as needed, whether or not that need lines up with a certain date on the calendar.
Ok, so this might be the obvious one. You are free to update how much you are saving, which plan you are saving it to, and even whether you are utilizing Fidelity or TIAA CREF throughout the year.
Adding or Increasing Life Insurance
I often find myself sitting across the table from a faculty or staff member that is under-insured. Although there are certain individuals that are best served by applying for an independent life insurance policy outside of work, many times it is appropriate to first obtain the maximum available life insurance through the University. Fortunately, the policy has been updated in recent years allowing faculty and staff to apply for or increase their Group Supplemental Life Insurance at any time. I specifically use the word ‘apply’ because you might be required to complete a health statement proving your insurability and, in some cases, complete a physical examination.
This isn’t limited to just you! Many families overlook obtaining an appropriate amount of life insurance on the non-working spouse in their household. This seems to be the case all too often for our physician clients. You can now also apply for this coverage through the University outside of open enrollment.
Dropping Life Insurance
We often explain to people that one of the primary purposes of obtaining life insurance to bridge the gap in time between when you have a lot of obligations and fewer resources, to a time when you have fewer obligations and a lot of resources. By nature, this often results in ending up with more insurance than necessary later in one’s career. The University now allows employees to lower their Group Supplemental Life Insurance or drop it all together at any time during the year.
While the need for life insurance is generally accepted, the need for disability insurance is often overlooked. However, according to the Social Security Administration a 20-year-old has more than a 1 in 4 chance of being disabled before reaching retirement age (Social Security, 2018). Fortunately for University faculty and staff, there is an Expanded Long-Term Disability plan available. The many, many moving parts of this plan will be detailed in a separate blog post in the future. The key point I want to emphasize today is simply that you can opt for the coverage at any time. No need to wait!
Completing an Estate Plan
Yes, if you are not currently in the Legal Plan you will have to wait until the next open enrollment rolls around to opt for this benefit. Fortunately, if you are enrolled in the Group Supplemental Life insurance coverage, you can have most of your estate plan completed without the Legal Plan. To find out more about what is available to you, the University utilizes Hyatt Legal Services and can be reached at (800) 821-6400.
While it may feel like it is an easy excuse to push off some of these important changes until next open enrollment, that’s not always what is best for our financial health and wellness. Make this year the year that you finally stick to your resolutions!
Ballard, J. (2018, December 13). Exercising more and eating healthier are this year's most popular New Year's resolutions. Retrieved December 14, 2018, from https://today.yougov.com/topics/lifestyle/articles-reports/2018/12/13/new-years-resolutions-2019-exercise-healthy-eating
Social Security. (2015, June 06). Retrieved December 14, 2018, from https://www.ssa.gov/disabilityfacts/facts.html