Don't Just Pick the Cheapest Health Plan

Your employer probably offers two or three health plan options. The temptation is to pick the one with the lowest premium, but that can cost you more in the long run.

Here's the real comparison: total annual cost = premiums + expected out-of-pocket expenses. A plan with a $200/month premium and a $3,000 deductible might cost you more than a $350/month plan with a $500 deductible — if you use healthcare regularly.

PPO vs HMO vs HDHP:

Key question: Do you have a doctor, specialist, or prescription you need to keep? Check whether they're in-network before you choose. Switching providers because of insurance is one of the most common and frustrating surprises.

HSA vs FSA: Which Tax-Advantaged Account to Use

If your employer offers both, here's the simple decision tree:

Choose an HSA if you're enrolled in a High Deductible Health Plan (HDHP) and you're generally healthy. In 2026, you can contribute up to $4,400 (individual) or $8,750 (family). The money is yours forever — it rolls over, grows tax-free, and follows you if you leave the job. Many financial advisors consider HSAs one of the best retirement savings tools available because of the triple tax advantage: tax-deductible contributions, tax-free growth, and tax-free withdrawals for medical expenses.

Choose an FSA if you're not on an HDHP or if you have predictable annual medical costs. FSAs let you set aside up to $3,300 in 2026 pre-tax, but here's the catch: most FSA plans are use-it-or-lose-it. Any money left at year-end is forfeited (some plans offer a small grace period or $640 rollover, but don't count on it). Only put in what you're confident you'll spend.

Pro tip: If your employer contributes to your HSA, factor that into your health plan decision. A $1,000 employer HSA contribution effectively reduces the cost of the HDHP by $1,000 — which often makes it cheaper than the PPO option, even before your own tax savings.

Group Life Insurance: Take the Free Coverage, Question the Rest

Most employers offer a basic group life insurance benefit at no cost — typically 1x or 2x your annual salary. Always enroll in the free coverage. There's no reason not to.

Where it gets tricky is supplemental group life insurance — the option to buy additional coverage through your employer, often up to 5x salary. This seems convenient, but there are important limitations:

For most people in their 30s, the better move is to take the free group coverage and buy a separate individual term life policy. An individual policy is portable, locks in your rate for 20–30 years, and lets you choose exactly how much coverage you need. A healthy 30-year-old can get a 20-year, $500,000 term policy for $20–$35/month.

Supplemental Coverage: What's Worth It

Your benefits enrollment might include a dozen supplemental options. Here's which ones are typically worth considering:

Long-term disability (LTD) — If your employer offers it at a subsidized rate, strongly consider it. Individual LTD policies are expensive. One caveat: employer-paid LTD benefits are taxable when you receive them. If you pay the premiums yourself (even through payroll), the benefits are tax-free. Ask HR whether you can pay the premium with after-tax dollars.

Short-term disability (STD) — Useful if you don't have 3–6 months of expenses saved. If you have a solid emergency fund, this is less critical.

Dental and vision — Usually cheap ($10–$30/month) and worth it if you'll use them. Dental in particular tends to pay for itself with just two cleanings a year.

Critical illness / accident / hospital indemnity — These "gap" policies pay a lump sum if specific events happen. They can be useful if you're on an HDHP and worried about a big medical bill, but they're not essential for most people. Don't let a slick benefits presentation scare you into overbuying.

Your First 90 Days: An Insurance Checklist

Action items for your first 90 days:
  1. Enroll in health insurance within your eligibility window (usually 30 days from start date)
  2. Take the free group life insurance — always
  3. Open and fund an HSA if you chose an HDHP
  4. Check whether your current doctors are in-network
  5. Update your beneficiaries on all employer benefits
  6. Evaluate whether you need individual term life beyond the group coverage
  7. Consider long-term disability if offered at a reasonable rate
  8. Review your old employer's coverage end date — don't leave a gap
Next step: Take our Coverage Gap Quiz to find out what you might be missing, or use the Insurance Checkup Checklist to review everything at once.
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