5 Workplace Benefits to Max Out BEFORE You Retire

Lightly edited for readability.

Same job, completely different outcome

Two colleagues at the same company, same salary, same employer match, same benefits package. One of them retires at 63 with a plan that's fully funded and a health care strategy that carries them through Medicare. The other one retires at 63 and immediately has to scramble, because the coverage that felt permanent just ended on a Tuesday afternoon. And the account they thought they were maxing out? They weren't even close.

Same job, same employer, completely different outcome. The difference was one conversation they had, or didn't have, during open enrollment. There are five workplace benefits that become dramatically more valuable in the final 3 to 7 years before you retire. And the last one on this list is the one most people blow past because they figure they're almost out the door anyway. That's exactly backwards, and I'll show you why. First, we need to go through the four that set it up.

I'm Brandon Sussman, a CFP professional and the owner of Traction Wealth Management, where I work with San Diego residents in their 50s and 60s who are serious about getting retirement right before the window closes.

1. 401(k) catch-up contributions

Number one is the one people have heard about, but almost nobody actually runs the numbers on. If you're 50 or older, the IRS lets you contribute more to your 401(k) than the standard limit, and in 2026 those limits just got more interesting.

The standard 401(k) contribution limit in 2026 is $24,500. If you're between 50 and 59, or 64 and older, you get a catch-up of $8,000 on top of that, so your total is $32,500. But if you're between 60 and 63, and this is the piece most people haven't heard yet, you get an even larger catch-up under SECURE 2.0. That enhanced catch-up for ages 60 through 63 is $11,250, which brings your total to $35,750 for the year.

Let's say you're 61 and you plan to retire at 65. That's four years of contributing at $35,750 instead of the standard $24,500. The difference is $11,250 per year, or $45,000 of additional pre-tax money over four years. At an assumed 6% growth rate, that extra $45,000 in contributions could grow to around $52,000 by the time you retire. That's not a rounding error.

One new wrinkle for 2026: if your wages from your employer were above $150,000 in the prior year, the IRS now requires that your catch-up contributions go in as Roth, meaning after-tax. This is new, and not every plan has caught up to it administratively yet, so check with your HR or plan administrator to confirm how your catch-up is being classified.

The San Diego factor here is that California taxes ordinary income at up to 13.3%, so getting money into the pre-tax bucket during these final high-earning years is a real lever. If you've been contributing the same amount to your 401(k) for the last five years without revisiting whether you're at the max, you might be leaving tens of thousands of dollars of tax advantage space on the table.

2. The HSA window

Number two is the one that surprises people the most, and I talk about it constantly with folks here in San Diego because the math is so clear. The health savings account, or HSA, is the only triple tax advantage account the IRS allows. You put money in pre-tax, it grows tax-free, and you pull it out tax-free when you use it for qualified medical expenses. No other account does all three of those things.

But your ability to contribute to an HSA ends the month you enroll in Medicare, and Medicare generally begins at 65. So if you're 60 right now and enrolled in a high-deductible health plan through your employer, which is what you need to be eligible, you've got roughly five years of contribution runway left. After that, the door closes permanently. Your existing balance stays, but you can never add to it again.

What does five years look like? Let's say you're 60 with family coverage and you and your spouse are both over 55. In 2026, the family HSA limit is $8,750, and each of you can add a $1,000 catch-up contribution to your own individual HSA. Between both of you, you could be putting $10,750 in the HSA accounts this year. Do that every year from 60 to 64, five years, and you've put $53,750 into an account that's never been taxed and never will be, assuming you spend it on medical expenses. At a conservative assumed 5% growth rate, that grows to roughly $62,000 by the time you hit Medicare at 65. Start at 57 instead of 60 and run it for eight years, and those same contributions build to roughly $104,000. The earlier you maximize this, the more runway you get.

In retirement, the HSA covers Medicare Part B premiums, Part D, supplemental premiums, dental, vision, and out-of-pocket costs. Health care is one of the biggest retirement expenses for San Diego residents, where the cost of living is already running about 30% higher than the national average. A six-figure tax-free bucket dedicated to health care costs is one of the most efficient things you can build in the final working years.

3. Group life and disability insurance

Number three is the one with the ticking clock nobody tells you about. Most employers provide life insurance as part of the benefits package, usually one to two times your salary, sometimes more if you've elected supplemental coverage on top of that. Most people treat it like furniture. It's just there. But here's what's actually going to happen on your last day of work: that coverage ends. The group policy doesn't travel with you into retirement.

Some plans offer a conversion option, meaning you can convert your group coverage to personal coverage and have an individual policy without being medically underwritten. But converted policies are almost always significantly more expensive than group rates, which are subsidized by the size of the group.

So the question to ask before you retire is: what's my gap? If you have a spouse who depends on your income, a mortgage, or any financial obligations that don't disappear when your paycheck does, you need to know what coverage you need and whether you should be shopping for replacement coverage now, while you're still healthy enough to qualify at a reasonable rate.

The same logic applies to employer-paid long-term disability insurance. If you're 62 and planning to retire at 64, a disability event in that window can force a retirement you weren't ready for, on a timeline you didn't plan for. So before your last open enrollment, pull out your benefits summary and look at what you're actually covered for. Your HR department should be able to tell you exactly what happens to each benefit on your retirement date.

If you want more content like this, built specifically for San Diego residents in their 50s and 60s, subscribing is the easiest way to see the next video.

4. Non-qualified deferred compensation

Number four is one most people in this audience have access to and have never used, or they set it up years ago and have never revisited. Non-qualified deferred compensation, sometimes called NQDC, lets higher-earning employees defer income beyond the standard 401(k) limit. If you're earning $250,000 and you've already maxed your 401(k) for the year, a deferred compensation plan is one of the few places you can stash additional income and defer the tax on it.

But the rules are rigid. They're governed by Section 409A of the tax code. The election to defer income for next year has to be made before the end of this year. If you want to defer any of your 2027 salary, that election has to be placed by December 31st of this year. You cannot go back and defer retroactively.

And the distribution timing, when and how you receive the money back, also has to be set up in advance. A later election to postpone a distribution generally has to be made at least 12 months before the original payment date. It can't take effect for at least 12 months, and it must push the payment out by at least five years. Last-minute planning does not work here. Get it wrong and the IRS can disqualify the deferral and hit you with a 20% additional tax on top of ordinary income tax, plus interest.

The San Diego angle, for high earners dealing with California's top income tax rate: deferring income into post-retirement years, when taxable income may be lower, can mean real savings on both the federal and state side, but only if the distribution is timed right. If your employer offers a deferred compensation plan and you've never modeled the distribution timing against your expected retirement income, that conversation needs to happen before your last open enrollment.

5. Your final open enrollment

Number five is the one I flagged at the start, and it's the real reason I made this video. Most people treat open enrollment like a checkbox. You log in, you make sure nothing went haywire, you click confirm. But your final open enrollment before you retire is not a checkbox. It is a planning event, and it is the last one you get. Here's what's actually on the table during that window.

Your 401(k) deferral rate. If you're 62 and your open enrollment runs in November, that's your last chance to move your deferral up to the maximum before the calendar year closes. Some employer matching formulas reset each January, which means leaving before you've hit the threshold leaves real money behind. Let's model it out. You earn $180,000, and your employer matches 100% of contributions up to 6% of salary. That's $10,800 in matching contributions annually. You've been contributing at 5% all year, capturing $9,000 of the match. Bump up your deferral for the last two months of the year and you capture the remaining $1,800 you would have otherwise left behind. Run that same under-contributing pattern across three pre-retirement years and that's $5,400 of employer money that was available and you simply never claimed it. That's not a market return story. That's a form story.

The health plan election. If you're retiring before 65, you need to know what health coverage looks like between your last day and Medicare. If your employer offers retiree health benefits, the final active open enrollment may be your last chance to lock into that arrangement. If they don't, this is when you need to start modeling what a marketplace plan is going to cost and how it coordinates with any HSA contributions you've been building.

The FSA versus HSA question. If you're transitioning from a traditional health plan with a flexible spending account, or FSA, to a high-deductible health plan with an HSA for the final working years, that switch happens at open enrollment. The FSA is use-it-or-lose-it, which means a poorly timed switch can forfeit money you already contributed. Knowing your FSA's rollover rules and coordinating the timing is exactly the kind of thing people get wrong because they didn't look closely enough.

Supplemental life and disability elections. If your employer's plan allows you to increase supplemental coverage during open enrollment, sometimes without medical underwriting, this is a very narrow window. If you've been meaning to increase coverage and never got around to it, this is the time.

The reason this is the flagged item, the one I spent the most time on, is that it's not really about any single benefit. Open enrollment is the one moment each year where every lever is accessible at once. The people who skip the final few because they figure they're almost done tend to be the ones who call us six months into retirement wanting to know why their income plan is off, or why a benefit expired when they walked out the door that they had no idea was ending. Treat the final open enrollment like the financial planning meeting it actually is.

The bottom line

So those are the five workplace benefits worth auditing before you retire. Max out your 401(k) catch-up contributions while the enhanced limits are available. Lock in as many HSA contributions as you can before Medicare enrollment closes that window. Understand what group life and disability coverage actually disappears on your last day. Get any deferred compensation elections in place before year-end deadlines. And finally, treat open enrollment like the planning event it is, because it's the last one you get.

If you want to sit down and run through what this looks like for your specific situation, your benefits package, your retirement deadline, your San Diego income picture, I'd love to help with that. You can schedule a free retirement consultation at sandiegoretirement.com/connect. No obligation, just a conversation to see where the opportunities are before the window closes.