Lesson 4 · 8 min read

Benefits Enrollment Done Right

Open enrollment is the one afternoon a year when a few clicks are worth thousands of dollars, and most residents spend it choosing the default because the packet is unreadable. Here is how to read it.

Lesson 4 of 8

Watch

Read it once. Five to ten minutes.

The retirement plan and the match

Your program almost certainly offers a 403(b) or 401(k), and some offer an employer match after a waiting period. Contribute at least enough to capture the full match; it is the only place in your finances where the employer adds to your deposit on the day you make it, subject to the plan’s vesting schedule. The 2026 employee limit is $24,500, more than a resident will use, and the plan usually offers both traditional and Roth options. Which one belongs in training is lesson five.

Inside the plan, choose the lowest-cost broad index funds available and ignore the rest. Hospital plans often bury two or three excellent options among expensive ones.

Health plan and the HSA

If your program offers a high-deductible health plan with a health savings account, and you are healthy, the HSA is the most tax-favored account in the code: contributions are deductible, growth is untaxed, and withdrawals for qualified medical expenses are tax-free at any age. The 2026 limits are $4,400 for individual coverage and $8,750 for family coverage. Physicians with a chronic condition, a pregnancy planned, or a family that uses care heavily may do better on a traditional plan; compare the total cost, not the premium alone.

If you can afford to, pay current medical costs out of pocket and let the HSA compound. Keep the receipts; qualified expenses can be reimbursed years later.

Group disability and life, read once

You met these in lesson one. At enrollment, take the group LTD, elect any option to pay the premium yourself with after-tax dollars if the plan allows it (the benefit then arrives tax-free), and take the basic group life. Buy supplemental group life only as a bridge; it rarely follows you and is not a substitute for an individual term policy if someone depends on you.

The 457(b), when you see one

Academic programs sometimes offer a 457(b) alongside the 403(b). It has its own $24,500 limit, and it comes in two versions that behave almost oppositely: governmental plans are held in trust for you and can roll to an IRA; non-governmental plans remain the employer’s asset and pay out on a schedule at separation. Residents rarely benefit from either, because Roth contributions are better at a resident’s tax rate. Note which kind your institution has. It matters at attending income.

Do

Check them off as you go. Your progress saves in this browser.

Find your plan’s match formula and vesting schedule, and set your contribution to capture the full match.
Replace the default target-date or annuity option with the lowest-cost broad index funds in the lineup, if better options exist.
Compare the high-deductible plan plus HSA against the traditional plan on total expected cost, and if you choose the HSA, set the contribution.
Elect the after-tax premium option on group disability if your plan offers it.
Write down whether your 457(b), if any, is governmental or non-governmental.

Teach

You know it when you can explain it.

Walk a co-resident through the enrollment packet in five minutes: match first, fund choices second, HSA versus traditional plan third, and the one disability election that changes how the benefit is taxed.

Check yourself

Why is the employer match the first dollar to fund?

Because it is an immediate return on the contributed dollars, before any market return, subject only to vesting. Nothing else in the plan compares.

What makes the HSA unusual among tax-advantaged accounts?

It is the only account with a deduction going in, no tax on growth, and no tax on qualified withdrawals at any age. It works best when current medical costs are paid out of pocket and receipts are kept.

What is the one enrollment election that changes how a group disability benefit is taxed?

Paying the premium yourself with after-tax dollars, where the plan allows it. An employer-paid benefit is taxable income at claim; a benefit you paid for is tax-free.

Educational content, current as of September 2026. Not individualized investment, tax, insurance, or legal advice; consult a qualified professional about your own situation. Tax figures reflect published 2026 federal parameters. Student loan program terms are set by the U.S. Department of Education; confirm your own plan at StudentAid.gov.