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PPO or High Deductible Healthcare Plan: Which is Better?


Santa In October?

October 17, 2021

PPO or High Deductible Healthcare Plan: Which is Better?

Companies typically offer a period of open enrollment in the fall, which gives employees the opportunity to review healthcare offerings and evaluate their plan selections. As Private CFOs® to our clients, we help families through this process each year. One important decision might be choosing between a high deductible plan, which could include access to a Health Savings Account (HSA), and a PPO (Preferred Provider Organization) plan.

A few important considerations when analyzing your options:

Cost/Ability to Incur a Larger Deductible
High deductible plans can be much cheaper per month, but you will have to come out of pocket for a larger amount to reach your deductible
Access to a Health Savings Account (HSA)
A savings account funded with pre-tax dollars (lowering your taxable income), which allows you to save and invest for future healthcare needs. These funds do not expire and do not need to be used each year, so your balance can grow/compound substantially over time. Also, many companies offer a contribution to your HSA for choosing a high deductible plan - free money!
  • In 2022, a family can put away up to $7,300 and an individual can put away up to $3,650
  • For those 55 and older you can save an additional $1,000

Upcoming Medical Needs
If you don't have a proper emergency reserve of cash and have large upcoming expenses (elective surgery or having a baby), a PPO might be a better option as your out-of-pocket expenses could be more limited in the short term

Healthcare costs continue to rise and make up a large part of expenses in retirement. In fact, Fidelity's most recent study states that for a 65-year-old couple that number could be as much as $300,000 (net of taxes) over your retirement years. Making the right plan selections each year can have a meaningful impact on both your immediate and long-term financial health!

If you would like to receive more information on making smart money moves for your future, be sure to contact us today!


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About the author

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Brandon Hayes

Managing Director, Private CFO®

In 2011 Brandon opted to forego a long-term career in corporate America to join oXYGen Financial because he was impressed by the vision of creating a premier independent financial services firm, which strives to provide unbiased advice to the X & Y Generations.

A native of Westlake, Ohio, Brandon currently lives in Atlanta with his wife Aly, daughter Maryn, son Turner, and their black lab Pepper. He's the youngest of three children and played soccer through college at Elon University. He's an avid runner and enjoys cheering for Cleveland sports teams despite some pretty rough years.

CERTIFIED FINANCIAL PLANNER™ and MBA from Georgia State University in Entrepreneurship. Brandon holds his Series 7 (General Securities Representative), 63, Series 65 (Investment Advisors Law) and Georgia Life, Health and Variable Insurance licenses.

The opinions expressed in this commentary are those of the author and may not necessarily reflect those held by Kestra Investment Services, LLC or Kestra Advisory Services, LLC. This is for general information only and is not intended to provide specific investment advice or recommendations for any individual. It is suggested that you consult your financial professional, attorney, or tax advisor with regard to your individual situation.

Background and qualification information is available at FINRA's BrokerCheck website.

Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design) and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.

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