By Sheryl Smolkin
Read this article and comments at Moneyville.ca
Your employer provides brochures and online tools to help you understand the pension and benefit programs offered, but chances are you haven’t spent more than a few minutes looking at them recently.
Since April 4th is National Employee Benefits Day, it’s the perfect opportunity to become better acquainted with your benefits program.
Consider the questions below to find out if you really understand your employee benefits plan and if you are taking full advantage of available programs.
1. How much will your employer put into your pension plan or RRSP?
Employers frequently match employee contributions to defined contribution pension plans up to a maximum of 5 or 6 per cent. Unless you enrol in the pension plan and contribute enough to get the full employer match, you are turning down free money.
2. How are your retirement savings invested ?
If you do not select how contributions to the pension plan are to be invested, they will be deposited in the “default” fund. This is often a money market or short-term fund that will give you poor returns over an extended period. Take advantage of in-house investment information sessions and make investment choices that will maximize your savings.
3. How much group life insurance do you have?
Your employer may pay for group life insurance coverage equal to one or more times your salary. But is this enough to cover your family’s expenses if you die? Your benefit plan probably allows you to purchase additional group life insurance for you or your dependants at reasonable rates.
4. Do you send in medical/dental receipts for reimbursement?
Many medical plans still require that you pay for drugs, dental appointments etc. and then mail in the receipts for reimbursement. If you lose or misplace receipts the amounts you are forfeiting can add up.
5. Do you understand how you and your spouses benefits are coordinated?
Coordination of two benefit plans means that instead of getting a portion of your bills paid, you may be able to collect up to 100 per cent. The extra paperwork can be a nuisance, but it’s worth it.
6. How does your health care spending account work?
To comply with Canada Revenue Agency rules your HCSA will either allow you to use funds deposited in the account for up to two years; or, allow you to claim expenses for the year in which they are incurred and then for one more year.
7. What are the annual maximums in your benefit plans?
By being aware of annual maximums for dental work, physiotherapy, orthotics or glasses, you can often time your appointments or purchases to use up, but not exceed the maximums each year.
8. What’s available from your Employee Assistance Program?
Whether you are looking for child care, elder care or personal crisis counselling, your Employee Assistance Plan can save you time and money.
9. Does your company match charitable donations?
A contribution to your pet charity will be twice as valuable if your company matches employee charitable donations.
10. Does your employer pay tuition or offer scholarships for employees and/or their children?
Tuition for college and university programs can cost thousands of dollars. If you can, why not upgrade your skills on the company’s dime?
11. Does the company have an employee referral program?
Your company may pay a cash bonus if you refer a friend and the person is hired and stays for some period of time (i.e. three months).
12. Does your company offer gym or other fitness subsidies?
Remember that New Year’s resolution to lose weight and take better care of yourself? A fitness subsidy may motivate you to get moving.
13. What happens to unused vacation days?
Many companies do not permit unused vacation to be cashed out or carried over to the next year. Yet the 2010 Expedia Vacation Deprivation Survey reports that almost half (46 per cent) of employed Canadians don’t use up their allocated vacation time.
These are only a few of the things you need to know about your benefit plans. If you don’t know the answer to some or all of these questions, take the time to find out. After all, taking full advantage of available workplace programs means more money in your pocket.