Buried Treasure: Your Company’s HR Department
Yesterday while sorting laundry I dug into a pocket to find a SURPRISE $10 bill. How cool is that moment? I felt like I’d just won the lottery, even though the money was already mine. I’d just forgotten it existed.
I have a secret for you: if you’re gainfully employed with a medium/large company, you might be missing out on lots of those $10 bills. Forget the $10….let’s super-size that: You could be missing out on Benjamins, not Hamiltons.
Anyone reading NOT looking for free money?
The benefits you’re missing aren’t always monetary….at first. Just like you have to drink a fair amount of beer to create water, you might have to apply a little energy to claim your Benjamins. But with a little work, you too can turn workplace benefits toward your favor.
I was always amazed when I’d meet with a potential client and begin asking them what benefits they had through work. Outside of their 401k plan, some people were hard-pressed to find an answer. Some people had no idea what insurances were available, if they could invest in employee stock purchase plans, or discounts at local merchants.
You don’t want to be that person. It’s the holiday season. Let’s give ourselves a little present.
Five Workplace Benefits To Ask About Today
1) Workplace Education Programs
Does your company offer chances to learn more about how money works? These sessions are always free and often are provided by local experts. You might get a sales pitch at the conclusion of some of these sessions, but if you learn one or two points about your financial plan, why not jump on that opportunity?
“The mind is everything. What you think you become.” – Buddha
Give me a 401k plan from your company and I’ll giggle like a little girl looking for ways to make it work efficiently.
First, do you have a Roth 401k option, where money is deposited after tax and can later be removed tax free?
If you have crappy, limiting choices in your 401k, is there a self-directed option where you can invest in an expanded menu of options? Can you complete an in-service withdrawal to an IRA to manage funds? (Watch out before making this move…401k plans give you more flexibility to grab money before 59 1/2 than an IRA).
I’ve met many people who didn’t know that they could drastically alter their tax situation TODAY and IN RETIREMENT by investing differently. Don’t spend all day focusing on your investment options only to forget that you’ll also claim a huge return by having the right tax structure.
My old employer offered a deal with the local health club, a membership retail chain, and several online retailers. I also received a discount with an insurance company inside of our parent company. Have you checked to see if any of these are available for you? Don’t know how to find them? Your HR team will know.
Employee Stock Purchase Plans
The worst financial advice I could give you is to load up on company stock. However, here’s a strategy we’d often employ: because many of my clients could purchase stocks at a 10 – 15% discount, I’d recommend they purchase some shares with each pay check. Then, as soon as they were able, sell the shares and diversify this money. If the stock found a way to stay even, the investor was able to claim a free 10% – 15% return. If the stock slipped, it would have to drop by 10 – 15% before they saw a loss.
The biggest downside to this plan was liquidity. Until the sale date, this money was wrapped up and untouchable in most plans. Don’t save your last dollar into a place where you can’t retrieve it quickly! Create your emergency fund first, and then use HR tools like an employee stock purchase program.
Also, don’t load up on the stock because you’ve decided to “hang on just a little longer.” Stick the the plan and diversify the stock so that you don’t regret a huge downturn in the future.
Have you been procrastinating on having that will drawn up? Well, procrastinate no more….and get it done more cheaply if you have a legal plan available through work. While these plans can drain you if you continually sign up and don’t use them, try this strategy: sign up for your legal plan for one year and use that benefit to have a will drawn up, along with a durable power of attorney and patient advocate designation (or health care proxy, as it’s called in some states). At the end of the year, remove yourself from the program. You’ll pay much less for your estate documents by using this company resource.
Are there any benefits you use through work that are often overlooked by others? Let’s help each other out by sharing more in the comment section below. Thanks!