Why Most Employees Miss Their Full Benefits | Dan Pascone with Kathy Mychajluk | Episode #27

Posted on August 3, 2025 by Dan Pascone

Answer Box: TL;DR

Most employees quietly give up thousands of dollars a year in missed benefits. In this episode, Dan Pascone and benefits expert Kathy Mychajluk walk through how to quickly audit your medical, dental, disability and retirement options so you stop defaulting into the cheapest plan and start using your benefits like part of your compensation package. Think of your benefits as an “invisible paycheck” — when you understand them, you may free up cash flow, reduce surprise medical bills, and redirect more money into long-term, tax-advantaged wealth. For high-earning professionals, small changes like smarter plan selection and automatic 401(k) increases can compound into meaningful retirement flexibility.

Key Takeaways

Your benefits are part of your total compensation. Most people skim the 20–30 page enrollment guide, default to whatever’s pre-checked, and leave real money on the table in the form of missed coverage, underused FSAs/HSAs, and unclaimed employer retirement match. The result: higher out-of-pocket costs and lower long-term savings.
Use a simple two-step process at enrollment. First, look backward: what did you actually spend on health care, dental, and prescriptions in the last 12 months? Second, choose plans and contribution levels based on that real-world usage instead of guesswork or habit. That alone can dramatically cut surprise bills and wasted premiums.
Pretax benefits and retirement plans are a built-in tax strategy. Health, dental, vision and FSA contributions are usually pretax, instantly lowering taxable income, and HSAs may offer triple tax advantages when used with a qualifying high-deductible plan (pretax contributions, tax-free growth, and tax-free qualified withdrawals). :contentReference[oaicite:0]{index=0} Combined with 401(k) and Roth 401(k) options, your employer plan can be a powerful, low-friction way to build wealth.
Small increases compound. Kathy’s favorite rule: every time you get a raise, automatically direct part of it into your 401(k) or 457 plan so it “never hits your lifestyle.” Even 1–2% increases per year can significantly move your retirement trajectory without feeling like a pay cut today.
Planning beats pay level. From the HR seat, Kathy has watched modest earners retire comfortably because they saved consistently and understood their benefits, while some very high earners struggled or even faced bankruptcy. Income helps, but planning — and saying “no” to certain lifestyle upgrades — is what ultimately drives flexibility.

Key Moments

00:28 – Why most employees miss their full benefits. Dan introduces the episode and frames benefits as a critical, often-overlooked part of financial planning for high-level professionals.
01:37 – Kathy’s 25+ years in benefits. Kathy shares her background in pensions, executive benefits, and health plans across healthcare, IT, finance, and now the State of Connecticut.
03:38 – The new-hire benefits “panic window.” How people ignore their benefits packet until the last reminder email and then default into suboptimal choices.
06:43 – A two-step framework for picking plans. Step 1: look at what you actually used and spent last year. Step 2: choose medical/dental options based on that real utilization, not guesswork.
09:05 – FSAs, pretax premiums, and invisible savings. Why pretax medical, dental, vision and flexible spending account contributions effectively increase your take-home value by lowering taxable income. :contentReference[oaicite:1]{index=1}
10:23 – HSAs and the fear of high deductibles. Kathy explains why older employees often resist HSA-compatible high-deductible plans, and how younger employees tend to embrace them.
12:07 – What HR sees: who actually retires well. Real stories of modest earners retiring early thanks to planning, versus high earners struggling because they never learned to keep what they made.
14:35 – The raise rule for 401(k)s. Kathy’s simple habit: every time you get a raise, direct a slice of it into your 401(k) so your lifestyle stays flat but your future income grows.
18:27 – Roth vs. traditional 401(k) for high earners. Why combining pretax and Roth contributions inside employer plans can create valuable tax flexibility later, and how Roth 401(k) options don’t have the income limits of Roth IRAs. :contentReference[oaicite:2]{index=2}
23:04 – Writing “The VIP Job Search.” Kathy describes why she wrote a book to help people navigate job loss, benefits, and the modern hiring process.

Episode Summary

This episode tackles a quiet leak in most professionals’ finances: underused and misunderstood employer benefits. Host Dan Pascone sits down with veteran benefits and operations advisor Kathy Mychajluk to unpack why even sophisticated executives often default into the wrong medical plans, skip FSAs or HSAs, and underfund their retirement plans — all because the 30-page benefits guide feels overwhelming.

Kathy walks through a simple two-step method for open enrollment. First, review the past 12 months: how many doctor visits, prescriptions, dental procedures, and surprise bills did your household actually have? Second, choose among your employer’s options based on that real utilization — not on habit, fear, or what a co-worker chose. She explains how pretax premiums, FSAs, and HSA-eligible plans can meaningfully reduce taxable income and turn routine expenses into a mini tax strategy. :contentReference[oaicite:3]{index=3}

From her HR vantage point, Kathy has seen modest earners retire comfortably because they started small and stayed consistent, while some highly paid leaders struggled due to lifestyle creep and lack of planning. She reinforces the power of automatic 401(k) increases with each raise and highlights why Roth 401(k) options can be especially valuable for high earners seeking tax diversification in retirement. :contentReference[oaicite:4]{index=4} Throughout, Kathy frames benefits as an “invisible paycheck” — money you’re already being offered, but only receive if you understand and actively use what your employer provides.

Full Transcript

(00:02) Dan Pascone: Brought to you by Tailored Wealth, helping business leaders live their version of a rich life.

Dan: Welcome to another edition of the Making Sense of Your Money podcast, where we cut through the financial noise and help business leaders to make smart, confident money decisions. Welcome to episode number 27 of the Making Sense of Your Money podcast.

Dan: I am your host Dan Pascow and I’m the founder and CEO of Tailored Wealth. And each episode features a trusted voice in the financial world, someone who works directly with high-level professionals to simplify the complex and turn strategy into action. And today I’m excited to introduce a special guest. We’ve got with us Kathy Mahalik who is a benefits and operations advisor for the state of Connecticut.

Dan: And Kathy has a long history and great expertise in the retirement and overall company benefits field. So I’m excited to chat with Kathy. We haven’t had anyone on with this specific specialty. So Kathy, pumped to have you. Thanks for joining us today.

Kathy Mychajluk: Great, Dan. I’m so happy to be here and I really want to thank you for inviting me as a guest on your podcast today.

Dan: Yeah, we’re going to have some fun and I know we’ve got a lot to cover. Our audience definitely has a lot that they’d like to hear from you. So, let’s jump right in. Kathy, why don’t you start by just giving us like a quick high-level, like 90 second overview of what it is that you do within your

Kathy: Yes. Well, my background in HR benefits includes 25 years of corporate experience in industries such as healthcare, IT, and finance and most recently in the government. And I started my career actually in pensions then graduated to executive level benefits and then I ended up with medical, dental, everything soup to nuts as far as employee benefits are concerned.

Dan: Wow. I mean that’s uh there’s a lot to get into there and obviously you touch a lot of the areas that are important to our clients and a lot of times we’re helping them to kind of navigate. So tell us a little bit about what you do today. Like tell us a little bit about how you advise people today and then maybe what’s been different being in the public sector versus your long-standing history in the private sector.

Kathy: Well, there are actually a lot more similarities than there are differences which I was amazed. I’ve been in the public sector for 4 years and spent 25 years in the private sector. So it was an adjustment. However, benefits are benefits. No matter what industry you’re in, employees are always anxious about, you know, when they get their, for instance, as a new hire, when they get their benefits package.

Kathy: Most people are overwhelmed. And what they do is they normally have a month before they enroll in their benefits as a new hire. And they do what everyone else does, which I also am guilty of, which is they put the benefits material aside, and they say, “Oh, I’ll take a look at that later.” And then what happens is you get an email, your first email reminder from HR, your second and the third tells you you have three days, okay?

Kathy: Otherwise it defaults to a very, you know, basic medical, no dental, no vision, and then you miss the enrollment for the 401(k) possibly. So what I would advise people to do, we’ll start with if you’re a new hire, just glance at the material at the beginning. And I know it’s very overwhelming.

Kathy: I got into plan contract negotiation with vendors and with benefit consultants and there’s all those SPD summary plan descriptions that are out there and people look at that and they’re like, you know, I’m not a lawyer. However, the information in your benefits enrollment guide, I advise people to review it.

Kathy: Just look at it, think about it, put it aside, let it absorb, and ask yourself some questions such as, well, how many medical plans do they offer? How many dental plans? Is there a vision? Is there short-term, long-term disability, life insurance? It’s a lot. It’s a lot when you’re a new hire.

Kathy: However, I found what kept me interested in the benefits world, which is still what I do today. I today for the state of Connecticut, I work with employers. So I’m giving guidance to other HR members or, you know, I don’t know all these people but I provide guidance as to what they need to do for certain benefits, time frames, required documents for their insurance plans and, you know, I find that what’s similar is actually the confusion or say people get overwhelmed with just the thought of the word benefits.

Kathy: People get scared. It’s like it’s so complicated I don’t want to deal with it. So whether it’s the employer side or the employees, you know, it’s like I felt in my career sandwiched because it was the executives that were coming with questions and then you have people who are, you know, maybe without a college degree or without some education and English may not be their first language and they’re coming to you with different needs and wants.

Kathy: I don’t know why I’m losing my voice today. Maybe I didn’t have enough coffee.

Dan: Yeah.

Kathy: But anyway, it’s a whole—people have always asked me why do you enjoy benefits so much? I said because one day is never like the other. It’s so different.

Dan: So let’s dive into this a little bit more. Whether you’re advising the HR professionals at private organizations or advising employees directly. We work with a number of clients that have gone through job change or are facing job change.

Dan: And I always say that during or immediately after you take on a new role is one of the most influential times to be doing custom financial planning. So we engage with a lot of new customers around that time.

Dan: So my question for you is what are like the biggest decisions that a new hire typically has to make? Let’s say they’re joining a larger organization that’s got a fairly well-built-out benefits package like the ones that you worked for in the past. What are those key decisions that you would advise that they tackle first? Because there is a lot to it.

Kathy: Yes. Well, what I’ve done is I’ve broken it down into two easy steps.

Kathy: So, when you get that employment benefits guide, and it’s 30 pages long, and you’re like, what are they talking about? Number one, I always advise people whether you’re single, you have a family, no matter how many members you have in your household, look at the last year or the current year and what did you use for your benefits.

Kathy: For example, did you go to the doctor a lot? Did you pay a lot of out of pocket for co-pays? Did you go to a non-participating provider? Is your regular doctor that you’ve had for 10 years no longer with the insurance carrier? And you could find some of that out just by calling the doctor’s office to say, “Do you take this coverage? Are you still in the plan? Are there any changes you anticipate?” So, the first step is looking at your history. Okay, what did I spend this year?

Kathy: You know, I needed extensive dental work. And maybe if you work for a larger employer, sometimes you’re lucky enough to have two or three medical choices, two dental choices. So, you have an option. You pay a little more and you get better coverage. So, those decisions are important during the hiring, you know, as a new hire.

Kathy: And basically look at what you spent out of pocket and then make your—the second step is make your future decisions based on your usage, you know, what you’ve utilized this year.

Dan: That makes a lot of sense. And other than just putting it off, which I agree with you, many folks do. What are the biggest mistakes that you see new hires making when it comes to their overall benefits packages?

Kathy: Well, I would say not taking advantage. Every employer offers different benefits, right? You’re never—I always used to hear people say, “Well, when I worked for ABC Company, I had blah blah blah.” You know, they listed, they went down the list. And we were always open to benefit improvements, but it also cost and that’s part, you know, we would usually start the planning in May for an October open enrollment.

Kathy: So I would say people don’t take the time, which equals if you don’t know what benefits you have, you fail to plan. And planning, I see benefit planning as an extension of financial planning. And I’ll tell you why. If you don’t understand your benefits, you’re going to be paying out of pocket. If you go to the wrong hospital or wrong doctor, you’re going to get a huge bill because they may not participate in the network.

Kathy: I’ve seen people get bills for 40 and $50,000 from hospitals because they went to a non-participating hospital. So, know your plan, know your doctors, look and see who’s there, who’s participating. And if you just have one medical selection and one dental, there’s also the flexible spending account where you can put pre-tax dollars aside for items not covered by your insurance.

Kathy: Now, a big benefit of employee benefits is it’s pre-tax. Medical, dental, vision, FSA. When you start getting into life insurance and short-term disability, those benefits are not pre-tax. So, that’s a savings to people already. And how I look at it is the money. If you really plan your basic benefits package well, you are now going to have extra money to put into your 401(k) plan.

Dan: Well said. I want to come back to that because I do want to shift gears and talk a little bit about the retirement benefits and your experience there. But let’s talk for a second about—you mentioned flexible savings accounts. Let’s talk about health savings accounts, right? That’s a question that we get asked oftentimes.

Dan: Typically they’re aligned with a high deductible plan, but I always say they’ve got this sort of triple tax advantage because the money goes in tax-free, it grows tax free and then you can take the money out tax free if it’s for medical expenses. So, what’s been your experience with health savings accounts? And have you had to work with clients to figure out like does it make sense to maybe take on that higher deductible plan to get the tax benefits of the health savings account, whether it be now or potentially in the future?

Kathy: That’s a very good question, Dan. I got that question a lot, especially from the person who’s been working for quite some time. So if they have 10, 15, 20 years or more with the company, they come in and I provide all the options to them. And I have to say it’s almost like we’re creatures of habit.

Kathy: And it’s changing a mindset which is very difficult if you’re used to having benefits a certain way your entire career. It’s difficult for people to wrap their head around that HSA change. It’s really a mindset change and it comes down to fear.

Kathy: And I see this all the time with benefits, with retirement, whether it’s pension, 401(k), social security, whatever questions. People don’t want to take a risk. It makes sense on paper, but they’re very hesitant. The people who have enrolled in that were a little younger and they love it. They’re very happy with that HSA plan. So, I would say it’s almost half and half, kind of mixed.

Kathy: But if you have someone who’s set in their ways and like, “This is what I’ve always done and this is what I’m going to stick with.” You know, benefits are very personal and I myself as an HR professional learned a lot from individuals, especially employees, about financial wealth just through their questions and through my work.

Dan: Let’s dig into that a little bit further. What kind of typical questions did you get and tell me how that maybe helped you to grow your expertise in overall financial wellness?

Kathy: Well, I—you know when you work in HR, you see a lot of things.

Kathy: And you see the good and the bad. People come in, you know, if they are having financial difficulty or if they’re retiring early because they planned really well. You see very deeply into people’s lives. And one thing that I got a lot of satisfaction, career satisfaction, out of HR is that I could make a difference in people’s lives by providing them with the information they need to then make a better decision for their lives.

Kathy: So, one of the biggest lessons I learned early on in my career when I started in pensions was I would be meeting people who make less than say $80,000 a year, 60,000 and they would be retiring early and I would, you know, I wouldn’t ask, but people always told me their story. So, it’s a little more formalized today where you don’t have as much time to spend with people. But I will never forget this gentleman came to me and said, “I have a rental property. My house, I bought a condo in Florida. It’s paid for when I’m retiring.”

Kathy: And he wasn’t even 60 yet. I think he was maybe 55. So I’m looking at him going, “Geez,” you know, because I was calculating the pension. So I look at your salary for the last five years and we go over the retiree medical and I’m thinking, how did he do it? He had a family, you know. And then I would have people making $800,000 and more a year coming into my office almost crying because they’re filing bankruptcy.

Kathy: So, you know, one of the key things I learned in my life, it’s—I know you need to make a certain amount of money to survive. However, it’s not only about how much you make, it’s about how much you keep. And people don’t realize the importance of small beginnings.

Kathy: I meet a lot of younger people who say, “Oh, you know, I have a car payment. I have rent. I can’t afford to put money in my 401(k).” Okay. Well, some plans may have a 1% requirement. Put in 1%. Some employers I worked for, you could put in as little as $10 a paycheck. I don’t know if that exists anymore, but it may if it’s a smaller company. It depends.

Kathy: And I always say to people, I say it to my siblings, you know, my youngest brother, why would he listen to his older sister? And he started a new job and I said, “Did you enroll in the 401(k)?” “Oh, I don’t have the money yet.”

Kathy: And I’m thinking, “Do I have to put on my HR hat again?” So, you know, don’t discount small beginnings because over time, you know, one thing I’ve done—someone gave me this advice many years ago, which was extremely helpful. Every time you get a raise, put that money in your 401(k) as if you don’t even have it yet.

Kathy: And I know people are like, “Wow, things are expensive.” I understand. But if you get a 2 or 3 or 4% raise, put half in your 401(k). It’s pre-tax. You’re saving for your future and then spend the rest or do whatever, you know, you want to get another car or whatever, go on vacation. But you have to have a plan. And if you don’t have a plan, I don’t know if it was Henry Ford or who said this, if you don’t have a plan, you plan to fail.

Dan: Yep. Yep. 100%. Yeah. You hit a couple things there that are important. I mean, it’s funny. We were chatting with a brand new client about this actually yesterday, but the idea that you just earn a lot of money doesn’t preclude you to being financially well, right?

Dan: Doesn’t preclude you to being on a good financial path because I’ve seen very very high earners who are very off the mark with respect to what their long-term goals are. And you mentioned you enjoy being able to impact and improve people’s lives. That that’s why we do what we do. It’s what gets me out of bed in the morning. That’s why I started this business. So that’s pretty cool to hear.

Dan: All right. So you started to chat a little bit about 401(k)s. Let’s talk a little bit about retirement programs. What do you see are the biggest challenges? What are the questions that you’re typically getting asked when it comes to retirement plans? And what are maybe some of the things that you see that the common employee sometimes misses with respect to their opportunities to save for the future through their employer?

Kathy: Yes, I see it across the spectrum of all ages, whether it’s a younger person in their 20s, and people close to 70s struggling because they’re, you know, they still need to work or they want to work for, you know, whatever reason.

Kathy: I would say it’s—and this might sound a little strange—but saying no to yourself sometimes. I mean, like I know this person who said to me, and I know she makes a decent salary, “Well, I can’t afford, can’t afford to do 401(k).” “Oh, my common charges went up, my mortgage went up or whatever.”

Kathy: But then she went out and bought a brand new car because her car was breaking down. And I’m like, okay, you know, a compromise would have been maybe a used car or could you have fixed that car? And you know, I know, like look, I would love a new car. My car is a few years old, but I am making the decision personally.

Kathy: My extra—my car payments are literally going into my 457 account.

Dan: Good for you.

Kathy: And there’s a lot of pressure from, you know, living in Fairfield County, there’s a lot of pressure to keep up, to have the newest car everybody’s got. You know, if your car is one year old, they’re like, “Oh my goodness, that’s old.”

Kathy: It’s like, well, you really have to look at your life. And it’s very hard because there’s a lot of peer pressure no matter what age. No matter what age. And I would tell people make an effort day one. Put some money in your 401(k). People I know sometimes struggle with maxing out the maximum amount you’re allowed by the IRS.

Kathy: The catch-up contributions, you know people struggle with that. But if you inch your way—what is the saying? That eventually the, it wasn’t the tortoise and the hare, but eventually the snail reaches the finish line.

Dan: They do. They do.

Kathy: So, you know, do you really need that car with the fancy—because people don’t—the same person who’s not putting any money in their 401(k) didn’t realize the insurance and taxes would go up along with that new car.

Kathy: So, now you’re paying $1,200 a month and you’re working remotely. Like what sense does that make?

Kathy: So I mean I don’t want to judge because everyone, you know, you’re responsible for your own finances and your own life, but we have to make certain sacrifices today short-term to meet our long-term goals.

Dan: I love it. Well said. We certainly do need to do that. All right. One last point and then we’re going to shift gears for a second.

Dan: So one of the things that we chat to a lot of our clients, along with people in our community through our content, is this concept of tax diversification. And you know one of the things that I often see missed that not enough even high-earning high-ranking executives don’t take advantage of is the Roth option within 401(k) plans. Right? And a lot of folks think you you’d be surprised, Kathy, at how often I say, “Do you have any money in a Roth? Are you contributing to a Roth?” And they say, “Well, I make too much money to contribute to a Roth.”

Dan: And the answer is you make too much money to contribute to a Roth IRA, but you don’t make too much money to contribute to a Roth 401(k) or an after-tax option within your 401(k). So, what experience do you have in that lane? And have you seen how Roth contributions and that component within a retirement plan can be really impactful on someone’s future?

Kathy: Yes. I have noticed a trend probably the last say six to seven years where more people are paying attention to the Roth IRA.

Kathy: And our entire careers were always told pre-tax, pre-tax. That’s why it’s so important to be aware and evaluate at least once a year. At least once a year. What am I doing with my—where’s my 401(k) stand? Could I be putting money somewhere else? It’s been a slow process.

Kathy: As much education as companies or vendors or consultants put out there, I don’t know if it’s people just think it’s too complicated or they don’t have the time for it. I wish people, for their benefit, I wish people would just pay more attention. It hits people when they’re ready to retire, say five, ten years away, and they realize I have a million dollars in my 401(k).

Kathy: “Oh, I’m all set when I retire.” Then they realize their entire career they put pre-tax benefit in and now you have to pay taxes on it. I have had people say to me, “There’s the required minimum distribution, Dan.”

Dan: Right?

Kathy: And there are people working and they have said to me, “I don’t want that money. You sent me the paperwork.”

Kathy: I said, “Well, it’s not the company. It’s the government. It’s a federal law. I have to do this.”

Kathy: They go, “I don’t want the money.” Because they didn’t want to pay taxes on it. So, I said, “Well, here’s what’s going to happen. Either if you don’t complete the paperwork and get it back to me, the government will make that decision for you and then give you the distribution.”

Kathy: So, I know some of it doesn’t make sense, but it is what it is. But people don’t realize till maybe 55-ish, you know, they start looking at the tax implications if they look at it then.

Dan: Yeah, Kathy hit on a couple of key points here that I want to outline for the audience. So, when it comes to the Roth versus traditional, and I usually say it’s not an either-or, it should be an “and” conversation, right? So, doing both—they both have unique benefits.

Dan: But to your point, we far too often, sounds like you do as well, see folks that have only contributed to the traditional 401(k). And then what happens is when they get to retirement, all of their distributions are taxable. And all of their distributions need to be calculated in what you smartly outlined as the required minimum distribution.

Dan: Whereas the Roth is money that still grows tax deferred. You pay taxes on the money before you contribute, but it grows tax deferred and you get to take the money out tax-free and doesn’t get calculated toward that required minimum distribution. So that’s money that you can get at whenever you choose to.

Dan: The government doesn’t really have any control over that. And the old adage was, well, I’m going to have be in a higher tax bracket during my working years. I’m going to be in a lower tax bracket in retirement. But the reality of it is is that may not necessarily be the case, right? Because as you have this big retirement 401(k) that income is taxable.

Dan: I’ll also add to the fact that it’s very likely—I mean, we just got gifted with a new tax code—but it’s very likely the tax rates are going to be higher in the future, right? We don’t know exactly. It’s going to change from administration to administration, but it’s very likely the tax rates are going to be higher in the future.

Dan: And then the last thing that I always say is regardless of what your feelings are on tax rates in the future and regardless of what you feel your tax rate is, by having the Roth along with the traditional, it gives you flexibility because you have the ability to tap into one bucket or the other or a combination of the two in various years to optimize your tax situation year-by-year in retirement, which for me, the biggest way that I see wealth given away to the IRS is not planning your taxes into retirement.

Dan: So, that’s something that we’re oftentimes talking about, the concept of tax diversification. I’ve written a lot of content and talked about that a lot in our in our videos and the like. So, I appreciate you bringing that topic to light. All right, good stuff, Kathy. So, we’re going to shift gears a little bit and now we’re going to get to know you a little bit more.

Dan: You are now officially entering into the lightning round, which is always a fun portion of the podcast. We never tell our guests I should say about this section. So all I want you to do is give me the first thought that comes to your mind. Could be a one-word answer, could be a long drawn out thought. Whatever makes sense for that question.

Kathy: All right. I’ll try to be nice to you, Dan.

Dan: You ready to go?

Kathy: Yes.

Dan: All right. We’ll start with an easy one. Coffee or tea?

Kathy: Coffee.

Dan: And you already mentioned coffee, so I think that was a layup. One meal for the rest of your life. What is it?

Kathy: Goodness. One meal. Pizza.

Dan: Pizza. Okay. I like it. I like it. You live in Connecticut. Do you have a favorite Connecticut pizza place?

Kathy: Peppies in New Haven.

Dan: Pepe’s in New Haven. Can’t go wrong with that. That’s a pretty well-known one. All right.

Dan: What is one tool or technology? Could be hardware, could be software other than your phone or your computer that you can’t live without?

Kathy: My journal.

Dan: Your journal. Okay. Very cool. Very cool. Good for you. Good for you. You’ve given us a couple of quotes already, but do you have a favorite quote or phrase about money or success?

Kathy: Probably had one this morning and now it’s—I probably need more coffee.

Kathy: I would say start small, save something. Save something. Plan, because planning works whether it’s benefits planning—benefits planning leads to financial planning—then it’s all part of meeting your goals in life. And I think it’s the one that I mentioned earlier about if you don’t plan.

Kathy: If you don’t make a plan, then you’re planning to fail. And I’ve seen it in my own life. I’ve experienced it. That’s why I love that particular saying. And just one thing I’d like to add just to let the audience know, Dan, about being a benefits professional and as part of the financial planning—when you save all the money in your benefits and you’re pumping up your 401(k) and you’re going into Roth and really making some serious changes to your retirement savings and planning for your future.

Kathy: I consider benefits what I call the invisible paycheck. People don’t pay attention to it. They ignore it. They just look for their check. Okay, here’s what I made this week. Here’s what I’m going to spend. Or here, you know, I got these bills to pay and here you go. And why I mentioned a journal is so important. I plan, I budget. I plan my goals for the day.

Kathy: In my job, at the end of the day, I write down what I need to accomplish the next day.

Dan: Good for you.

Kathy: It’s a small step. Not necessarily a quote, but I would say have a plan. That’s my message. Have a plan. Call Dan. How’s that?

Dan: Oh, I see what you did there. I might have to pay you for the rights to that slogan.

Dan: I like it. I like it. Well said. Do you have a favorite book on business, finance, success?

Kathy: I like Dave Ramsey.

Dan: Okay.

Kathy: Because he’s very practical.

Kathy: And I think people are afraid—a lot of times people are afraid to come to HR to ask questions. They’re embarrassed because they think, “I should know this by now.”

Kathy: I should know this.

Kathy: So I tell people don’t be afraid to ask. Just go and ask. Get the help you deserve.

Kathy: Big lesson I learned in HR which helped me in my life. If you don’t ask, you don’t know.

Dan: There you go. Well said. Well said. All right, Kathy. What’s one bucket list item that you’ve already checked off that you’ve already—

Kathy: Let’s see. Already accomplished. I wrote a book.

Dan: Oh, wow. Tell us about that.

Kathy: Well, also as a byproduct of my HR benefits career, I had lost a number of jobs due to acquisitions, companies moving out of state, companies merging. And you know, it was pretty challenging as an HR professional to find yourself on the other side of the desk. And so when I started—I was gainfully employed again—I kept saying, I’m going to write a book.

Kathy: I’m going to write a book because people just don’t know some of the basics, the HR tricks, so to speak, behind the scenes of what you need to do to prepare and to get a job. It’s a lot more difficult today. So, I found a publisher last year. I had searched for a while. The book was published in February of this year and it’s called The VIP Job Search.

Dan: Okay. Very cool.

Kathy: And you know, I’ve been doing some talks and people have been buying the book. So, I’m very pleased about that. But it incorporates HR tips and a lot of behind the scenes. You know, people ask questions like, “Why is no one calling me or why is this happening?” And again, if you lose your job, you have to stay on top of your finances. That’s another—we could do that in another segment, Dan.

Dan: I like it. Maybe we’ll bring you back for another one. I like it. Very good. Good stuff. All right. One last one for you, Kathy. If you could give one piece of advice to your younger self, what would it be?

Kathy: Save more money.

Dan: Save more money. Okay. Well, you’ve been on theme today. I like that.

Dan: Very cool. Very cool. All right. And then lastly, you mentioned your book. If our listeners want to get your book, reach out to you, what’s the best way to either connect with you or get your book?

Kathy: My book is on Amazon.com, Barnes & Noble, and also Books a Million. And sorry about that. And I’m on LinkedIn. So if anyone has any questions, I’m still connected to an HR networking group and I talk to people and help them in whatever way I can. So LinkedIn would be the best way.

Dan: Very cool. Very cool. Kathy, thanks so much for joining us. Great discussion, great insights. Thanks for your time today.

Kathy: Thank you, Dan, for having me. We’ll talk soon.

Dan: Very good. All right, that’s it for the episode. As always, you can find all of our content through our content hub at makingsenseofyoumoney.com. Thanks for joining us today.

Resources & Citations

IRS Publication 969 – Health Savings Accounts and Other Tax-Favored Health Plans. Official IRS guidance on HSAs, FSAs and other tax-advantaged health arrangements, including contribution limits and tax treatment. :contentReference[oaicite:5]{index=5}
Health Savings Accounts: triple tax advantages. Overview of how HSA contributions can be pretax (or tax-deductible), grow tax-deferred, and be withdrawn tax-free for qualified medical expenses. :contentReference[oaicite:6]{index=6}
U.S. Department of Labor – Employee Benefits Security Administration (EBSA). Federal resource for understanding employer-sponsored health and retirement plans, including publications such as “Top 10 Ways to Make Your Health Benefits Work for You.” :contentReference[oaicite:7]{index=7}
U.S. Department of Labor – What You Should Know About Your Retirement Plan. Plain-language guide on 401(k)-style plans, fees, disclosures and participant rights. :contentReference[oaicite:8]{index=8}
IRS Publication 560 – Retirement Plans for Small Business. Useful for understanding contribution limits, pretax vs. Roth options, and catch-up contributions in 401(k)-type plans. :contentReference[oaicite:9]{index=9}
Survey data on paycheck-to-paycheck households. Recent surveys continue to show that roughly three-quarters of American workers would struggle if their paycheck were delayed, highlighting the importance of benefits-based planning and emergency savings. :contentReference[oaicite:10]{index=10}

FAQs

How do I quickly review my benefits when I start a new job?

Start by looking backward: pull the last 12 months of doctor visits, prescriptions, dental work and surprise bills for you and your family. Then open your new employer’s enrollment guide and compare that real usage to each medical and dental option’s premiums, deductibles and networks. Focus first on keeping your current doctors in-network and on avoiding under-insuring against your typical costs. If you feel stuck, your HR/benefits team and your financial advisor can help you translate the booklet into concrete choices that fit your situation.

What’s the difference between an FSA and an HSA, and which might fit me as a high earner?

A health FSA is an employer-sponsored account where you contribute pretax dollars and typically must use most of the balance each year (with only limited carryover), but it doesn’t require a high-deductible health plan. An HSA requires enrollment in an HSA-eligible high-deductible plan and offers three potential tax benefits: pretax contributions, tax-free growth, and tax-free withdrawals for qualified medical expenses, with no “use it or lose it” rule and full portability if you change jobs. :contentReference[oaicite:11]{index=11} High-earning professionals who can handle the higher deductible and who invest the HSA balance for the long term may get substantial tax-efficient growth, but those with heavy ongoing medical needs may prefer richer up-front coverage instead.

How much should I contribute to my 401(k) or 457 plan if I feel stretched?

A practical starting point is to at least contribute enough to capture your full employer match if one is offered, because that match is effectively a guaranteed return. From there, consider the “raise rule”: every time you receive a salary increase, direct part of it to your plan so your lifestyle doesn’t inflate and your savings rate slowly rises. Over time, even 1–2% incremental increases can have a meaningful impact, especially when combined with thoughtful investment choices. Exact contribution levels should be tailored to your cash flow, debt and goals, ideally as part of a broader financial plan.

Should I use pretax or Roth 401(k) contributions as a high earner?

Pretax contributions reduce your taxable income today and create tax-deferred growth, but all withdrawals will be taxed in retirement. Roth 401(k) contributions don’t give you a current deduction, yet qualified withdrawals are tax-free and Roth 401(k)s in employer plans are not subject to the income limits that affect Roth IRAs. :contentReference[oaicite:12]{index=12} Many executives choose a mix of both to build “tax diversification,” giving future flexibility to manage tax brackets and required minimum distributions. The right blend depends on your current and expected future tax rates, equity comp, and other assets.

How can I avoid nasty surprise medical bills when I have good insurance?

Most surprise bills come from using out-of-network providers or misunderstanding how deductibles and coinsurance work. Before scheduling procedures, confirm with both your insurer and the provider’s office that the doctor, facility and any ancillary providers (like anesthesiology) are in-network for your specific plan. The U.S. Department of Labor and EBSA offer consumer-friendly guides on using your health benefits and understanding protections such as the No Surprises Act. :contentReference[oaicite:13]{index=13} Keeping an emergency fund and using FSAs/HSAs where appropriate may also soften the impact of unexpected costs.

What’s one simple benefits habit that can meaningfully improve my long-term wealth?

Once a year, usually at open enrollment, block time to do a “benefits audit”: confirm your coverage still matches your family’s health needs, verify contributions to FSAs/HSAs and retirement plans, and increase your savings rate if cash flow allows. Think of this as a non-negotiable calendar event, like a board meeting for your household. Paired with small, automatic increases to your 401(k) or 457 savings and thoughtful use of tax-advantaged accounts, this habit can turn your benefits from a confusing packet into a core driver of your long-term net worth.

Disclaimer

This episode and page are for educational and informational purposes only and do not constitute financial, tax, legal, or HR advice. Always review your specific benefit documents and consult your own tax advisor, financial planner, or HR/benefits team before making decisions about insurance coverage, retirement contributions, or other benefits.

Next Steps

If you’re a high-earning professional or executive, your benefits are one of the easiest places to recover lost dollars and redirect them toward your version of a rich life. Take 30–60 minutes this week to review your current medical, dental, disability and retirement elections using Kathy’s two-step process, then update contributions and coverage where needed.

When you’re ready to integrate your benefits into a full wealth plan, explore more episodes and resources at Making Sense of Your Money, or learn how Tailored Wealth partners with equity-rich professionals and leaders at yourtailoredwealth.com.