As a business, marketing, or HR leader, it’s essential to fully understand and optimize company benefits to ensure the well-being of employees and the overall success of the organization. Unfortunately, mistakes can be made when managing these benefits, resulting in lost opportunities or financial losses for both the company and employees. Here are a few common mistakes you could be making.
Leaving Money on the Table
One of the most common mistakes made with company benefits is failing to take advantage of matching contributions, effectively leaving money on the table. Many organizations offer matching contributions to retirement plans, such as 401(k)s, as part of their benefits package. Employees who don’t maximize these contributions miss out on valuable savings that can significantly impact their long-term financial well-being. To avoid this mistake, educate employees about the importance of contributing enough to their retirement plans to receive the full employer match. Encourage them to review their contribution levels regularly and make adjustments as needed to ensure they’re not missing out on any available matching funds.
Still Using an FSA
Another mistake is continuing to use a Flexible Spending Account (FSA) instead of a Health Savings Account (HSA) when an HSA is available. Both accounts offer tax-advantaged savings for healthcare expenses, but HSAs have several advantages over FSAs. Unlike FSAs, HSAs roll over every year, so you never lose the money. They can also be invested, offering the potential for long-term growth. In addition, HSAs are portable, meaning they stay with the employee even if they change jobs or retire. On the other hand, FSAs are subject to a “use it or lose it” rule, where any unused funds are forfeited at the end of the year. Given these differences, it’s essential to evaluate whether an HSA is a better fit for your organization and employees, and make the switch if appropriate.
Overlooking Peripheral Benefits
Peripheral benefits, such as wellness programs, employee assistance programs (EAPs), and professional development opportunities, are often overlooked, despite their potential to improve employee satisfaction and well-being. These benefits can address various aspects of employees’ lives, from physical and mental health to career growth, contributing to a more engaged and productive workforce. To avoid this mistake, take the time to review and assess the peripheral benefits your organization offers. Ensure they align with employees’ needs and interests, and communicate these offerings effectively. Encourage employees to take advantage of these benefits and provide regular reminders and updates to maintain awareness and engagement.
Effectively managing company benefits is crucial for the success and well-being of both your organization and employees. By addressing common mistakes, such as leaving money on the table, still using an FSA, and overlooking peripheral benefits, you can ensure your company’s benefits package is optimized and appreciated by employees, ultimately contributing to a thriving, engaged workforce.
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