PBM Best Practices Series: What to expect from your PBM account team
Pharmacy benefit managers play a key role in helping plan sponsors manage prescription drug spend, and good account management can make all the difference
A debate has emerged over the past several years, thanks in no small part to the national discussion about the growing student loan crisis. Should you contribute to your employer’s retirement plan or work to pay down your debt obligations? This has been, and still is, a very personal decision.
Your employer’s retirement plan will likely offer tax-deferred savings over the long term that would yield a variable rate of return based on the investment choices offered within the plan. The benefit of this approach has historically been to save up for retirement over time. Terminology like “dollar-cost averaging” and “compound interest” are used to explain that the longer your contributions are invested in the market, the more earnings potential they could capture over the long term.
Conversely, personal debt, whether that is comprised of student loans with low interest rates, or high-interest credit cards and loans, presents a restriction on discretionary budgets. Many people set goals to pay down personal debt before beginning their retirement saving. Some feel the simple joy of being “debt-free.”
Over the past several years, some developments have emerged that have had a direct impact on this decision, which has made it difficult for individuals to continue to maintain or increase their contributions for retirement.
Despite the challenges facing individuals when it comes to a decision to contribute to retirement savings or pay down personal debt, oftentimes a combination strategy might be the best approach. Why not do both? Here are four suggestions to allow for both:
It may take time, patience, and perseverance, but even in the current landscape employees can contribute to their retirement and pay down their personal debt.