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Dan Slagle  00:00

You think there are actually situations where households are sitting down together, like, you know, like, there are certain stats out there in the world that are like, 1% of the population does this in their lifetime. 5% what would you guess? Like, how many households are actually doing that?

Natalie Slagle  00:17

I envision this lovely couple sitting at their little breakfast nook table, and they have a candlelit and they're talking, and they're kind of caressing each other's hands and talking about Open Enrollment.

Dan Slagle  00:33

Wow, keep it PG.

Natalie Slagle  00:40

Welcome to Money dates, the podcast that makes money conversations with your partner feel a little less taboo. I'm Natalie Slagle, a certified financial planner, and I'm joined by my husband and business partner, Dan Slagle, also a Certified Financial Planner. Say Hi, Dan, hello. In each episode, we'll share honest stories and practical tips to help you and your partner feel more connected and confident on your financial journey. So grab your drink, get comfortable and join us for our money dates. Dan, how are you doing today?

Dan Slagle  01:12

Hey, I'm doing pretty well. I'm doing well. It's been a little bit since we you and I have actually recorded an episode together, so it's fun to be back in in the podcast room with you.

Natalie Slagle  01:24

Thank you. It is fun. I was kind of like nervous, even though now we've been doing this quite a few times. I was I felt the nerves come back. You felt a little rusty, Rusty. Yes, I also have a little bit of a sore throat, so y'all might be dealing with that, hearing that that's okay,

Dan Slagle  01:44

yeah, it's that time of year, right? Like midway through fall, baby is also has been like, having a runny nose, coughing. It's just that time of year.

Natalie Slagle  01:55

It's just that time of year. Yes, and speaking of that time of year, we have an episode that is very timely for this time of year, at least for most people. We have a few clients where this doesn't make sense right now, but for most of our clients who work for an employer, it is benefit season.

Dan Slagle  02:17

Yay. Yay. Open Enrollment. Benefits Open Enrollment. This is the time of year, typically in October, where you're getting the email from HR saying your open enrollment window is from this date to this date. Please make elections in your HR portal, and you get that 50 page PDF document, and you're like, I don't want to read this. So what do you typically do? You just opt in to what you chose last

Natalie Slagle  02:43

year, default. What's the default option? I'll do default

Dan Slagle  02:48

is default is always the easiest option. I will also say it is not the

Natalie Slagle  02:52

best option for you. Well, not always. Sometimes it is, sometimes, sometimes it is. Sometimes is what's difficult with benefit season when you're married is it tends to not overlap perfectly. So some of our clients, they're already starting to get their benefits packet, and they have to make an election now within the next couple of weeks, while their partner hasn't even gotten their benefits yet. And they're like, Well, how do we compare? And how many people are actually sitting down with their partner and looking at both of their open enrollment packets and saying, okay, whose plan should we do? And how do we map this out? If you are doing that, that's incredible. You get an A plus plus, not just an A, not an a plus, but an A plus plus, because that takes work and energy that we don't all have time for.

Dan Slagle  03:49

So you you think there are actually situations where households are sitting down together like, you know, like there are certain stats out there in the world that are like, 1% of the population does this in their lifetime, 5% what would you guess? Like? How many households are actually doing that?

Natalie Slagle  04:06

I envision this lovely couple sitting at not their dining table, but their little breakfast nook table, and they have a candle lit and they're talking, and they're kind of caressing each other's hands and talking about Open Enrollment.

Dan Slagle  04:25

Wow, keep it PG Okay. In this example, they have also printed out the 50 page document. They're like, highlighting things,

Natalie Slagle  04:32

yeah, because you can't have a computer, it's not as romantic. But like going through these pages and they're highlighting and then making maybe a little love note on the margin saying, I love you. I can't wait to be on the same medical plan together. This

Dan Slagle  04:46

needs to be a scene out of, like an A 24 movie, right? Like a 24 film, like they just need into a film,

Natalie Slagle  04:54

yeah, okay, let's be real. That's not happening. And so. What we do is we create that experience without the breakfast nook, without the caressing, without without the candle. We do create the analysis for our clients, and we and we help evaluate both open enrollment packets. And so we figured, hey, why don't we talk about this? Because if you're not a client, maybe this would still just kind of give you some pointers on what we do to kind of help clients through this kind of busy season and this kind of weird window of a season this fall with open enrollment. So Dan, how do you want to start

Dan Slagle  05:38

off? I think we should just go down in the order that we typically review the benefits package, like we always start with medical, dental and vision? Yeah, I think those would be the three areas to start with. And I think those are, like, the most number heavy portion of that conversation, or this conversation, right? So when it comes to medical benefits, and and looking at your benefits versus your partner's benefits, if there's kids in the equation, right? There's a lot of different ways you can select benefits for your household. One of you can take the entire family. Maybe one of you has lower premiums, if it's just an employee, and if the other partner has benefits where it makes sense, or from a cost perspective, for employee plus kids, then that's how you separate it out. There's just a lot of different ways you can navigate it. And one of the ways that we go about in coming up with a solution for clients is looking at it from a cost perspective. So comparing premium costs across the board, not only premiums, but we're going to be looking at things like your deductible, your out of pocket maximum. So when it comes to medical plans and how we compare costs, we're actually looking at it from a side by side comparison to say, what's the least amount that you would pay in a single year, like barring no medical needs whatsoever? From a minimum perspective, it's essentially your your premium, right? The premium per paycheck that you're paying in that piece. And I feel like a lot of people miss this, what we do is we actually add back, if you're contributing to a health savings account in HSA, we add back into the minimum calculation of your premium. We add back the HSA employer contribution, right?

Natalie Slagle  07:20

Because if you're not contributing to the HSA plan, then that's dollars you're leaving on the table, and that could very much be okay. Again, it's just all calculating what is the minimum amount you're going to pay in health coverage, which would be the premiums, like you talked about. And how do we factor in? Hey, over here you get an employer contribution, and over here you do not. So it's, it's quite the calculation. The other thing I want to point out here that, I mean, this gets tricky for us, but let's say Dan, you and I both work for separate employers, and the number of options we would have to select, especially if we have a dependent, is a lot, right? So I could have my Natalie plan, or my Natalie and daughter plan, or my family plan, and everyone's with me. So that's three options right there. Then Dan, you're going to have those same three options, and that's just for one plan, right? So maybe that's the high deductible plan, but Natalie, you should also evaluate what the lower deductible plan looks like, and that has three options. So this is why people just hit the default, because it can get cumbersome when you're actually evaluating, okay, whose family plan should we be on? Or should Natalie be just by herself and Dan have the kids? Like, wow, I'm exhausted talking about

Dan Slagle  08:50

it. So in your example, and let's use us as an example, like you said, we're with separate employers. So for example, if I had so, let's say I went on my employee only medical plan. Well, we need to also map out the cost of what does it cost from a premium standpoint for you and our daughter to be on a separate plan? So employee plus kids, right? Yeah. And then you need to combine the costs of the two, right? And you need to reference that across the other plan options that you have available for your family, right? Is what you're saying. So in that example, I'm an employee, only you and our daughter, employee plus kid, there's a total premium between us that we need to be aware of, and then we could compare that against. Well, what happens if I took the entire family on my medical plan, or if you took the entire family on your medical plan, or if you were on the employee only plan, and I was the employee plus kid option. So you're comparing like four different

Natalie Slagle  09:54

costs, right? Yeah, much. And, oh my gosh, and, and, and. Surcharges. Everyone needs to be aware that if you are offered health insurance and you decline it, and you go to your spouses, you could have a surcharge on the medical premium. And we have done this analysis many, many times over the years for our clients, and sometimes even paying the surcharge to be on your partner's health insurance. You know, you'll get the surcharge if you're offered it, but you decline it, and you go to your partners, sometimes the surcharge actually still makes sense to pay. It's wild. It's a wild world out there that's just medical, that's just medical, but that's how we do it, right? So we again, I want to make sure that this can be helpful for people who are having their breakfast nook date, caressing and you got to let that go. You got to let that go real fast. Oh, I'm just like, imagine this lovely couple doing that. Maybe we should do that. We could be that lovely couple. We need a breakfast nook anyways. We have no idea what our health costs are going to be in a year, something could happen. And you know, hopefully nothing unexpected happens. And so what we'd like to map out is what is the minimum we're going to pay, which is usually going to be that medical premium. And so calculate what your minimum payment is going to be across your entire family, so your premium and your spouse's and then what those look like that will help you evaluate how much your minimum payment will be. And on top of that, that's when you have to turn over and look at the out of pocket maximum let's say something catastrophic does happen. Then are you going to be prepared when you look at both of your out of pocket maximums? And let's just assume you select two different plans. Are you prepared for whatever that out of pocket maximum could be for your family. Now, the other thing I will add, which has been interesting for the clientele we serve, because some of our clients are still having babies, is sometimes we know a very expensive medical event is coming, such as having a baby. And so we're going into Benefits Election thinking we don't care about the minimum, because we know we're going to hit the minimum. What we care more about is the out of pocket maximum. And so knowing that I'm pregnant today and I'm not pregnant, I'm just I'm the example, but knowing that, you know, if I'm the client, I'm about to have a baby, my focus isn't on the minimum we're going to pay in health premiums now, it's about the out of pocket maximum. So my strategy has changed here. Man, sometimes I like take for granted all the all this planning we do around it. It's kind of fun.

Dan Slagle  12:38

It is, and especially when there's different life events, right? And depending on the plan, you choose whether it's the high deductible, the PPO, whatever it may be, there's additional things you need to consider with that plan, right? Are you ready to talk about something different besides medical plans?

Natalie Slagle  12:55

Sure, because we probably could have just had one whole episode on medical plans. So I'm ready to move on from something.

Dan Slagle  13:01

Yeah. Okay, so depending on what type of medical plan you opt into, then we need to be mindful of, are we going to be contributing, potentially to a health savings account, a flexible spending account, right between the two health savings account, you need a high deductible health care plan. That's a requirement, and then each of those accounts has annual contribution limits that you can contribute set by the IRS for that calendar year, right? So then you need to consider, well, how much should I be contributing to my HSA or my FSA throughout the course of the year, depending on who's carrying the medical plan, does one person contribute the entire amount for the family. You split it up between the two if you're on your different medical plans, what does that do from a cash flow perspective for your household? Because these are all things that are being deducted from your pay before it even hits your bank account, right? So the conversation, just as we keep talking that conversation of the ideal couple at their breakfast nook, caressing each other is like could become a little tense. Possibly,

Natalie Slagle  14:06

what could be tense about it, just all the selections and decisions you have to make?

Dan Slagle  14:13

Yeah, absolutely. And maybe you have a feeling one way or the other of how things should be done, and I have a feeling one way or the other how things should be done, and how do we come up with a good solution? Because we need to incorporate potential healthcare costs, like we're trying to, like, forecast into next year, and that's just realistically, unless you are along your pregnancy journey, like there's not much else that you can account for, to say, Hey, this is for sure going to

Natalie Slagle  14:41

happen. Yeah, yeah. I mean, some, some of our clients know of surgery is coming up, and maybe they're not immediate and things like that. The other aspect in this selection process is just sometimes the numbers don't matter. We've had clients where we. Present the numbers and say, Hey, you're you're going to save 1000s. And that the reason why we're spending so much time on this medical insurance selection is because this can be the difference of 1000s of dollars in a year for clients. And we have presented, hey, going on this plan, assuming what we know of your medical situation could save you X amount of dollars, 1000s of dollars. And we've had clients say, I hear you, I see it. I know you're probably right. But on that plan, I don't have access my doctor is not an in network. On the plan I'm currently on, my doctor's in network, and I like them so much, or I have history with them, and it is worth more than the dollars you've presented. And I'm grateful that I have those dollars I can make an informed decision. So it's that's what the beauty in what we do is like we just present the data, we just present the numbers. Here's and then clients can feel more empowered and more informed in their decision with all of this based on what we show them.

Dan Slagle  16:00

Yeah, the calculations into, you know, minimums paid, maximums paid, very similar with dental and vision as well. Yeah, right. There's not too much of a difference. And even from the premium perspective, I mean, medical plan is typically where we see that the largest amount of cost savings, potentially for for a household, would you agree with

Natalie Slagle  16:22

that? Yes, absolutely. The vision and dental, it's like, here, you can save 20 bucks a year by selecting this versus that. It's, you know, it's still, I think clients want to be smart with it, but it's not, it tends to not have nearly the amount of impact like the medical decision.

Dan Slagle  16:40

I have a fun question for you. When do you feel like is the appropriate time to add your newborn to your dental insurance?

Natalie Slagle  16:48

I'm sure I would have a different answer than the than the dentist. We took our child to her first dentist appointment, and we talked to the dentist about this, and they were like, well, here's what the out of pocket cost was going to be, and I think it was around $100 they didn't charge what they would charge an adult, and I'm glad they didn't, because they didn't really do anything,

Dan Slagle  17:16

you know? They just listened to her cry for like, 30 minutes while they tried

Natalie Slagle  17:19

to not cry for 30 minutes. No, she was, she was upset. She was

Dan Slagle  17:24

there was a stranger, yeah, trying to dig into her mouth with a mask on.

Natalie Slagle  17:29

Yeah, there could be people listening who haven't ever taken their infant to the dentist yet.

Dan Slagle  17:35

Okay, yeah, that's very Yeah. He was awesome.

Natalie Slagle  17:39

Yeah. He was like, clearly, he's, she's clearly upset. I'm not gonna, like, force my hand.

Dan Slagle  17:45

I don't mean I'm not trying to, like, paint a bad light on this dentist. Because I actually, I was like, How can I work with you going forward? He was so kind. Yeah, he's great. I brought that question up because we hear that a lot from our clients, when they're like, Oh, we're having a a new child, the new baby, into this world. Like, when do we add them to dental insurance?

Natalie Slagle  18:04

Yeah, I would say at least. Well, I'll just say what we did. We did not add our baby to our dental insurance in year one, and TBD on, if we're going to do it for year two, before moving away from the health insurance. Things a little bit you touched on this, Dan, there's the HSA versus the FSA. So an FSA will be available if you do not select the high deductible health care plan. So, and I shouldn't say it will be because your employer has to offer it, but typically, what we see is if you have a high deductible health care plan, you will have an HSA that goes along with it, typically, not always. If you don't select the high deductible health care plan, you'll have the FSA. Both can be used for medical expenses. Y'all can look up what you can and can't use it for one area that we see missed quite a bit for our clients is selecting the dependent care FSA and the limited purpose FSA, so you could have up to three different FSAs. And I'm realizing we're using abbreviations instead of actually saying it. So the flexible spending account, and you could have up to three different accounts, and most of our clients actually could use all three accounts. So part of our job is not only to evaluate what option to select, but also to bring to light, hey, you have all of these options. Let's make sure you're actually enrolled in it.

Dan Slagle  19:35

Yeah, for all you listeners, check out. I think it's just as simple as hsa.com Right? Like the to talk about the eligibility of certain purchases. The HSA is very beneficial. We may have talked about it. We may have not but just getting that pre tax contribution, your earnings grow tax free, and then withdrawals for qualified medical expenses, no tax triples.

Natalie Slagle  20:00

Tax savings, triple

Dan Slagle  20:02

triple tax savings. There's a few strategies with the HSA. We can talk about this in a later episode. But you know, some people, if cash flow allows for you to cover expenses from from cash flow, then there's a train of thought, just hold on to your receipts and reimburse yourself at a later date and allow that money to grow, because the best part of the HSA is the investment vehicle tied to it to allow it to grow. Now, with the flexible spending account, there's a certain dollar limit set by the IRS each year you have to spend it to use it or lose it. What movie is that from? Is that 40 year old virgin? I don't think that's

Natalie Slagle  20:39

use it or lose it. I feel like that. Saying has got to be around since the 1600s I don't know. Use it is from a movie. Yeah, I think so. Anyway, so Shakespeare wrote about it at one point. I don't know, interesting.

Dan Slagle  20:53

We can dive into that after this episode. Don't fact check me. So with the flexible spending account, there's typically an amount around $500 where you can roll it over into the following year, either it needs to be used in like, you know, the first, let's say two, three months, your employer is going to have guidelines around that. So that's important to note, the dependent, not the dependent care, the what account Am I trying to limited purpose? The limited purpose FSA, so, limited purpose? FSA, yeah, limited purpose. FSA, it is for a limited purpose. So typically, what do we see there medical?

Natalie Slagle  21:32

The Limited is, yes, is for dental and vision.

Dan Slagle  21:36

So dental and vision, so what we do for clients is we talk about the benefits of that account, and if there's a way to allow your HSA to grow while still put money into let's say you're going to have a root canal or something done. I don't even know what a root canal costs, but let's say you're going to have a root canal done in the following year. You could say, Hey, I'm going to fund my limited purpose FSA with three grand or whatever the maybe, you probably go up to the cap with a root canal just, I don't know, I'll have to ask my dad. Sorry, dad. But essentially, with that, that allows you to deplete the limited purpose FSA, because you need to deplete it by the end of the year, and then that allows money to still be in your HSA and let

Natalie Slagle  22:18

it grow. Yes, yes. Yes. So I always say, so, for instance, I have contacts, I have classes. So I always, I should say I would have always, because I don't have a limited purpose FSA, but what I would do is I would fund enough in that account to at least buy those two items, because I get those every year, and then obviously evaluating what other costs could be coming your way so that your HSA could grow. That's great advice. Now the dependent care FSA that is capped at $5,000 a year, which is so funny, because that is maybe to a little over two months of daycare costs for us, you know who have a someone in daycare younger than three years old. So the dependent care FSA is nice because it essentially you're just funneling money so that you could get the tax deduction, which for hiring clients. I'll take deduction of $5,000 of my income any day. You know, I'm going to turn around and spend it in two and a half months, because that's what daycare costs. But don't forget about that. Don't forget about the dependent care FSA. And I had this question come up with a client, but on like, what you can use that for daycare is pretty obvious. You can use the dependent care FSA for daycare, but the cost should be associated with having your child in some sort of care so that you can work. So, you know, we had a client ask about, like, after school activities, like, could they take reimbursement? No, that you you're not supposed to do it. It is mainly for true care, not not activities like hockey practice at four o'clock would not necessarily qualify. So just know what you can and can't use all of these funds for.

Dan Slagle  24:16

Yeah, what's next? What's next on this long list of things that we'll tackle,

Natalie Slagle  24:20

disability insurance, so that'll come up in your elections. You should have access to short term disability and long term disability. I feel like we typically see short term disability is just covered by most employers, right? So just yay, great. Make sure you enroll in that the long term disability is also typically provided by employers. If it's not we would recommend clients enroll in it the long term disability. And I believe the the insurance broker that talked to us said that one in four adults need disability coverage at some point in their life. So this is not an. Common to use these types of insurances. What I also see with our clients and what their employer offers is that you can actually, they call it a buy up on the long term disability, so you can actually increase your coverage, so maybe it covers 50% of your salary. You can buy up an additional 10 to 20% of coverage. And we, we tell clients, yeah, just go ahead and do that. Protect your future income, because it's, it's not typically that expensive to do. So

Dan Slagle  25:30

yeah, opt in. If you have those, those options available to you, then the next one, from an insurance standpoint, is life insurance. So a lot of employers may offer something similar to we'll cover, or you can enroll in a policy that's one times your base salary, seen up to three times your base salary. There are higher options available to you. Most employers also have a buy up or purchase an additional amounts of life insurance above and beyond those base requirements. But what we'll see at a certain threshold, and what I've seen recently, is like around, let's say, $500,000 if you go above that amount for insurance coverage through your employer, there's additional Evidence of Insurability in order to get a greater policy,

Natalie Slagle  26:16

which means underwriting and you have to have someone come to your house and do all these tests. Maybe it's a medical or medical written exam, but just like with regular life insurance, once you get to a certain level, you have to provide the insurance company information on whether or not they think they should insure you or at what rate they're going to give the life insurance

Dan Slagle  26:39

policy. I was just gonna say this policy stays with you as long as you're with your employer, right? So that's a huge call out that we have for our clients, is knowing, hey, if you were to ever leave your position or your company, let's say you're 35 now let's say you left when you're 45 and then you went to work at a startup that offered no life insurance. Well, guess what? We're gonna probably recommend that you get some sort of additional life insurance at 45 on the open market, and now you're 10 years older than when you had this insurance policy, right? So we need to think about, are there certain ways to like hedge our life insurance coverage to make sure if you ever were to leave your current company? Do you have substantial coverage for future income for your family. Should you pass away?

Natalie Slagle  27:24

Yes, having the almost diversifying your life insurance options between an outside policy and work and we love our Term Life policies. We don't need anything with bells and whistles and having the two for different purposes can be really nice. I think the last thing when it comes to open enrollment that we see are is legal insurance. We have clients that have access to legal insurance, which can be really nice, because it's a great way to start creating your estate plan and at a very affordable cost. We've also had clients elect legal insurance, just as like an additional insurance for their financial plans, because who knows when you need an attorney. And we've had clients use legal insurance and use an attorney for various reasons outside of creating an estate plan, such as real estate transaction, divorce, just, you know, you just never know why you need an attorney. And so this legal insurance, some folks just like to have it indefinitely, even if they've gotten their estate plan done.

Dan Slagle  28:33

Yeah, they might cost you 2020, ish dollars per paycheck or per month, potentially. So if you add that up, you know, $240 to get access to a network of vetted localized attorneys, not a bad option to just have in your back pocket, should something come up,

Natalie Slagle  28:51

right, right? And there's always, again, not always, but a lot of times we see this additional selection you can do with insurance. I'm going back to the insurance side, accident, incidental, and there's another one critical

Dan Slagle  29:07

Accidental Death and Dismemberment is what well, that is around Halloween. So we should talk about dismemberment as well. Why not?

Natalie Slagle  29:15

That's on the life insurance side. But there's the other insurance as well. That is, it's like additional insurance on top of your medical insurance. So like, one policy will pay out if you need to get a ride in the ambulance or something like that. They're really cheap. What I think it's nice is that if you don't have a lot of liquidity, you don't have a lot of savings, it's a good way to protect yourself of an unforeseen medical event. Our clients are doing very well financially, and so they tend to have, you know, a big savings account, big brokerage account. So it's like, if you want to transfer that risk, you can, it's very cheap policy, but you can also just self insure. Should one of these crazy things come up, you have the funds to provide for it. So, and I disclaimer, because we've, we've talked a lot. About what we recommend for our clients, there are always the one offs. We have a handful of clients that they have such a unique situation that we're like, I know we typically say to do this, but for you, we're going to say to go do this instead. And so our advice is general here, as you know that, and if you want specific advice, well you should give us a call. Me trying to be a sleazy sales woman, my

Dan Slagle  30:25

kid, that was super sleazy. That was good. No, I, but

Natalie Slagle  30:29

I, you know, I mean it genuinely like you should give someone a call. We would love to hear from you if you want more of an evaluation, because this is a really big piece of your financial plan. People are not giving it enough credit. And there's really big decisions to make when it comes to open enrollment.

Dan Slagle  30:45

Anything else did we miss? Anything on the list of items we go over? I mean, it was very like high level and but still detailed enough. I'm trying to think, you know, other, just one other call out, go through your employer benefits packet. Sometimes there's nice, you know, perks of being an employee. Sometimes it's like, IVF is available. Oh, a fertility treat. Yeah, absolutely, that's something that we see more and more. It's more and more common in benefits. And there's just also some additional perks that you may see, you know, sometimes your employer may contribute $500 extra into your HSA for being healthy or taking x amount of steps, right? Like, there's all these different like benefits that we see worked into the 50 page document. Don't be afraid to comb it over. That's going to be really important for, like Natalie just said, for you and your entire household,

Natalie Slagle  31:40

right? And some employers are really, really good about putting it front and center on what, what things they are offering, and some employers are not. So it's kind of you miss out on some of these benefits that they're providing. And, yeah, just making sure that you carve out time to really evaluate both your benefits and then your partner's benefits, and then what it means for your family is a really important aspect of of open enrollment season.

Dan Slagle  32:08

Awesome. Well, thanks, Natalie. I think you truly may have inspired a couple of listeners to go to their breakfast nook this weekend and caress, caress, their benefits booklets.

Natalie Slagle  32:20

Caress, absolutely Thanks, Dan. We'll see you next time. Bye.

Dan Slagle  32:28

Hey, if you've enjoyed this episode and are looking for personalized financial guidance, schedule a free complimentary consultation using the link in the description below, Natalie and Dan Slagle are the founding partners of Fyooz financial planning a registered investment advisor. The information provided in this podcast is for informational purposes only and should not be considered investment advice or a recommendation to buy or sell any securities. Investing involves risk, including the potential loss of principal. Advisory services are offered to clients or prospective clients, where Fyooz financial planning and its representatives are properly licensed or exempt from licensure. For more information, including our disclosures, please visit our website at WWW dot fyooz financial.com

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