10 Tips for Navigating Open Enrollment

Beginning each fall, many employers kick off their open enrollment period. This is a time when employees have the opportunity to enroll in — or make changes to — their health insurance benefits. As the open enrollment season approaches, now is an excellent time to review your current health insurance coverage, determine what benefits or funds you have left to use before the close of the coverage year, and consider your insurance needs for the upcoming year.

Basic Information Required

If you are a new benefits enrollee or if you are making changes to your medical coverage, you will need some basic information for the family members you wish to cover. You will need to have Social Security numbers and birthdates of the family members you will be covering. Additionally, if any of your family members are covered by secondary health insurance plans, you will need to have those policy numbers and the name, birth date, and Social Security number of the policyholder.

Current Providers and Medications

To accurately compare your current coverage with the insurance plans you have to choose from during open enrollment, make a list of the names of your current healthcare providers. Include doctors, specialists and hospitals or healthcare systems for each family member to see if they are included in your employer’s benefit plan network. Also, gather a list of regularly-taken medications for each family member – the name and dosage – as well as the name and address of your preferred pharmacy. Knowing your co-pays and other out-of-pocket costs will be key to determining the correct plan for you and your family.

Summary of Benefits

Review the benefit plans’ summary of benefits and comparison tables if more than one option is available to you. Be sure to compare the procedures and medications that are covered, and not covered, by each plan. Also consider each plan’s level of coverage for preventive care, such as annual physicals, mammograms and well-child visits.

Cost Comparison

Estimate how much you can afford to spend on healthcare in a year and compare the premiums, deductibles and co-pays. Then, total what you spent in the previous year on doctor visits and medicine. Remember to list annual or seasonal doctor visits and treatments for chronic conditions like asthma, as well as behavioral health costs for therapy or counseling. If your records are inaccurate, use an online healthcare cost calculator to help you estimate your spending.

Also consider co-insurance costs (for health insurance plans that have separate prescription drug plans), and your annual spending using your medical savings account (MSA) or flexible spending account (FSA). To predict your MSA/FSA spending for the coming year, total your costs for over-the-counter medications, chiropractic care, vitamins/supplements, and alternative medicines and treatments. If your unused MSA/FSA funds don’t roll over, be sure to use them before your spending deadline.

Could you use some assistance making decisions about the costs of healthcare during open enrollment season and how it can impact your other financial needs? An excellent resource is an experienced accountant like those at Donohoo Accounting Services. Schedule a free consultation at 513-528-3982 or email us today.

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4 Common Money Concerns And How To Fix Them

The people who worry the most about money are … most people. Whether you have a lot, a little or you’re somewhere in between, concerns often linger about such money issues as having enough income for retirement, being able to cover emergency expenses, staying afloat following a job loss and making wise decisions about using the income and savings you have. To help ease your mind about your money concerns, the following tips will help you address some of your top financial stressors.

Make Wise Financial Decisions

If you’re lacking skills and experience in making good financial decisions, there is a fix for that. Online you will find a number of money management courses that can train you in how to budget, manage your money, control spending, invest and make wise financial decisions. As well, many local investment firms offer free courses in money management and investing, as do some banks and community organizations that are devoted to financial literacy.

Prepare for Loss of Employment

Fluctuations in business markets and in the economy overall can turn what once seemed like permanent employment into sudden job loss. When this happens, what can you do to stay afloat and sustain your lifestyle until you find a new job? Start by paying yourself first by saving 10 percent of your income – until you have six months’ worth of income saved. This is a standard rule for having money to live on in case of sudden job loss.

Set Aside Emergency Funds

The next important thing to plan for financially is the next emergency. An emergency expense may be suddenly needing a new car or replacing a major appliance that breaks down. Because these concerns make such a big impact on your budget, it’s important to have at least $2,000 saved at any given time to accommodate an emergency. Pay yourself first out of your current income or trim your spending as you would to save for any other important goal.

Save Enough for Retirement

Because some of your living expenses actually go down during retirement, you should plan on needing about 80 percent of your current income level to maintain your lifestyle. After considering all of your various retirement income sources such as Social Security, 401K, investments and pension, meet with a retirement planner or use an online tool to determine how much more income you’ll need. Then, make sure you’re taking advantage of retirement benefits offered by your employer (such as matching contributions), and save and invest small amounts on your own over time to meet your goal.

Additionally, if credit card debt is a major concern for you in managing your money, be sure to read our blog about the Top Five Things to Know about Credit Card Debt. As well, the professionals at Donohoo Accounting Service are here to help you manage your finances. We have been helping people like you to wisely manage their finances for more than 20 years. For a free consultation, call us today at 513-528-3982.

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Tips To Save For A Great Family Vacation

If you haven’t already begun saving for your spring or summer vacation this year, you have two choices: 1) Declare it’s too late to save and wait until next year, or 2) Make a plan and make it happen! To get started saving right away, follow these three tips that will move you closer to achieving your dream of taking a fun-filled spring or summer vacation.

Form a Budget

If you’ve already decided where you’d like to go on vacation, when you will go, and for how long, establishing a budget is easy. You can go about forming your budget in two ways: First, research via the internet to find the best flight fares, hotel packages, transportation, restaurants, and other expenses. Then plug those numbers into a vacation budget planning form that will help organize and calculate your expenses. Second, form a budget by outlining your vacation destination, travel dates and the estimated amount you’ll have to spend. Then, have a travel agent find you the best deals based on the vacation packages they have available.

Look for Ways to Save

We’re all familiar with the traditional ways of saving money, such as having a change jar or piggy bank or opening a savings account with a local bank. Those ideas still work and may be useful in helping you save for your vacation. But in today’s world, there are even better means of helping you reach your savings goal. First, among the modern savings tools, you can use to help you are the many smartphone apps that automatically transfer a set dollar amount – at pre-determined times – from your checking account into an account for your vacation. Apps such as Mint, Digit or Qapital may be useful. In addition to saving money from your paycheck each month, you can create sources of additional income by selling household items and collectibles online on sites such as eBay, Etsy or Amazon.

Make Your Goal Tangible

While your spring or summer vacation may only seem like a dream until you actually leave for the trip, there are things you can do to make it tangible and real now! Print off some color pictures of your vacation destination and hang them up where you’ll see them daily. Additionally, you may consider purchasing a few small items that you will need for your trip, such as suntan lotion, sandals or a bathing suit. Put these items out where you’ll see them regularly to remind you of why you’re saving. How will these ideas help you save? By having visible images and tangible items related to your vacation in plain view, you will stay focused and motivated to achieve your vacation savings goal.

The professional accountants at Donohoo Accounting Services have even more ways to help you save. Contact us today to schedule your free consultation or call 513-528-3982.

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Four Tips To Save For College

Depending on grades a great score on the ACT or SAT, your future college student could have a big scholarship in his or her future. If you – and your student – haven’t been saving for college, how can you save as much as possible before the first tuition bill arrives? Whether you have a short amount of time or a decade, these four tips will give you a start on how to save for college.

Start with a goal

A college savings goal consists not only of a dollar amount but also includes a date or deadline. The most common way to compute a college savings goal is to divide the total dollar amount needed by the number of years you have to save. Another popular goal-setting method is to multiply the student’s age by $2,000. This will give you roughly the amount you should have in savings to cover 50 percent of the student’s college expenses.

Use the 10 percent rule

Could you live on 90 percent of your household income for a period of time? Probably so. Most people could, simply by looking for ways to reduce their spending. While you budget to live on 90 percent of your take-home pay, the other 10 percent goes into an educational savings account (ESA), 529 college savings account or even an interest-bearing savings account (or some combination of these). Depending on your total household income, 10 percent a year could add up to quite a bit between now and the start of college.

Save income from part-time or summer jobs

Even better than the 10 percent rule is the 100 percent rule – but only make it apply to income earned from part-time or summer jobs that your student works. A student earning $8 an hour working year-round in a part-time job can earn up to $8,000 during a single year. That’s a sizeable contribution toward college expenses! Parents can double that amount by offering to match dollar-for-dollar the amount their student saves each year.

Sell unused and unwanted items

Collectibles, antiques and even used appliances have the potential to bring in a handsome sum when sold online or in yard sales. Put your family and relatives to work scouring their attics, basements, and garages for anything of value that can be sold to add to your college savings account. The more unused or unwanted items you can sell – even for small dollar amounts – will eventually add up to help meet college expenses.

Need help developing your college savings plan? Donohoo Accounting can get you started. Contact us today to schedule your free consultation or call 513-528-3982.

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