Open Enrollment Checklist: Decisions That Shape Retirement

Every autumn, millions of Americans receive an email with a subject line something like: Action Required: Your Benefits Election Window Is Open. Most people click through, confirm last year's choices, and move on in under ten minutes.

That habit is understandable. Open enrollment feels like an HR administrative task, not a financial planning moment. But the decisions made inside that portal, from which health plan to select to whether disability coverage is adequate, connect directly to the retirement you are building. Some of those decisions have tax consequences that last for years. Others, like a stale beneficiary form, can quietly unravel an estate plan that took decades to build.

This checklist is designed to slow you down just enough to make each election count. Work through it section by section, and you will walk away from this year's window with benefits that are actually working toward your long-term financial life, not just covering next year's doctor visits.

The health plan decision is where most people start and stop their open enrollment thinking. The instinct is to compare premiums and pick the lowest monthly cost. But for pre-retirees, there is a second question worth asking before choosing: does this plan make me eligible for a Health Savings Account (HSA)?

An HSA is only available when you are enrolled in a qualifying High-Deductible Health Plan (HDHP). For 2024, the IRS defines an HDHP as a plan with a minimum deductible of $1,600 for individuals or $3,200 for families, and maximum out-of-pocket limits of $8,050 and $16,100 respectively (IRS Publication 969, 2024).

Why does this matter for retirement? An HSA carries what many tax specialists describe as a triple tax advantage: contributions go in pre-tax, growth is tax-free, and withdrawals for qualified medical expenses are tax-free. After age 65, you can also withdraw HSA funds for any reason and simply pay ordinary income tax, making it function similarly to a traditional IRA. For 2024, HSA contribution limits are $4,150 for self-only coverage and $8,300 for family coverage, with a $1,000 catch-up contribution available if you are 55 or older (IRS Rev. Proc. 2023-23).

The comparison to weigh is not just premium versus deductible. Consider what the employer contributes to an HSA, if anything, and whether the tax savings on contributions offset the higher deductible exposure. A lower-deductible plan is sometimes genuinely the better fit, particularly if you have significant predictable healthcare costs. The point is simply to make that choice deliberately, with retirement in mind, rather than defaulting without thinking it through.

One important note: once you enroll in Medicare, you can no longer contribute to an HSA. For those approaching 65, maximizing tax-advantaged accounts in the years before Medicare eligibility is a commonly discussed strategy worth exploring with a financial adviser.

Open enrollment season and 401(k) contribution elections often run on separate tracks, but many employers allow contribution rate changes at any time during the year. Even if yours does, open enrollment is a natural checkpoint to revisit the number.

For 2024, the IRS allows employees to contribute up to $23,000 to a 401(k), with a $7,500 catch-up contribution for those aged 50 and older, bringing the total to $30,500 (IRS Notice 2023-75). If you received a raise since your last review and your contribution is set as a flat dollar amount rather than a percentage of salary, the real-dollar value of that election may no longer reflect your intentions.

A few questions worth sitting with during this review period:

• Has your contribution rate kept pace with any salary increases this year?
• Are you capturing the full employer match? Missing even part of a match is effectively leaving compensation on the table. If this is a concern, it is worth reading about how front-loading contributions can sometimes affect employer match timing.
• If you are 50 or older, have you considered using the catch-up contribution allowance?
• Are you contributing to a traditional (pre-tax) 401(k), a Roth 401(k) option, or a mix of both? The tax treatment of each differs significantly depending on your current and expected future tax rate.

If your employer offers both traditional and Roth options inside the 401(k), open enrollment is a reasonable time to reconsider that split. The considerations involved are specific to each person's tax situation, so a qualified financial adviser can help clarify which approach aligns with your broader retirement picture.

These two benefit categories are among the most underexamined during open enrollment, and also among the most consequential. Think of them as protection for the retirement savings you have already accumulated, not just income replacement for today.

Life insurance: Many employers offer a base amount of group term life insurance at no cost, often one or two times your annual salary. Supplemental life coverage is typically available for purchase during open enrollment, and this is often one of the few times you can increase coverage without providing medical underwriting. If your dependents, outstanding debts, or estate plan have changed since you last reviewed this, it is worth recalculating whether your current coverage is adequate. Keep in mind that employer-provided group term life insurance above $50,000 generates imputed income under IRS rules, which is taxable (IRS Publication 15-B).

Long-term disability (LTD) insurance: This coverage protects your ability to earn income and, by extension, your ability to keep contributing to retirement accounts. Many group LTD policies replace 60% of pre-disability income, but the definition of disability, elimination period, and benefit duration vary widely. Review whether your current coverage would realistically bridge the gap if you were unable to work for an extended period, particularly in the years when your retirement savings contributions are at their highest.

Neither of these is a one-size decision. Coverage needs tend to shift as children become independent, mortgages are paid down, and retirement assets grow. Annual enrollment is a practical moment to reassess.

This is the step that requires the least financial expertise and is skipped most often, sometimes with serious consequences.

Beneficiary designations on retirement accounts and life insurance policies are legally binding documents. They override your will. If your 401(k) still lists a former spouse, a parent who has passed away, or an adult child who was a minor when you filled out the form, that designation controls who receives the assets regardless of what your will says. For a deeper look at why this matters, this guide on beneficiary designations and estate planning covers the stakes involved.

During open enrollment, log into your benefits portal and check the beneficiary section of every account your employer administers. This typically includes:

• Your 401(k) or other employer retirement plan
• Group life insurance
• Supplemental life insurance
• Any pension or profit-sharing plan

Consider designating both primary and contingent (backup) beneficiaries, and confirm that the names and relationships are current. If your family situation has changed through marriage, divorce, the birth of a child, or a death in the family, this is the moment to reflect those changes. It takes less than five minutes and is genuinely one of the higher-impact actions available during enrollment season.

Not every employer offers these, but if yours does, the open enrollment window may coincide with an election period for nonqualified deferred compensation (NQDC) plans or decisions tied to equity compensation like Employee Stock Purchase Plans (ESPPs).

Nonqualified deferred compensation plans allow eligible employees, often executives or highly compensated individuals, to defer salary or bonuses into a future tax year. The rules governing these plans are strict under IRS Section 409A. Elections must generally be made before the start of the year in which compensation is earned, and the timing and form of future distributions must be specified at the time of election. These decisions are difficult or impossible to change later, and mistakes carry steep tax penalties. The trade-offs involved are worth exploring carefully before electing to defer. For more context on what those trade-offs look like, this overview of deferred compensation decisions covers the key risks and considerations.

If your employer offers an ESPP, the enrollment window determines whether you participate in the next purchase period. These plans can offer a meaningful discount on company stock, but they also introduce concentration risk and specific tax treatment that varies by plan type. General information about how these plans work is available through the SEC's investor education resources at investor.gov.

Both of these areas carry enough complexity that consulting a qualified financial adviser or tax professional before making elections is widely recommended.