Why You Should Treat Your HSA Like an IRA

March 27, 2025

Would you raid your Roth IRA or 401(k) to pay for car repair bills? I suppose if you have no other choice, you might. But ordinarily, we want to use our tax-advantaged retirement accounts only as a last resort because we want that money to grow tax-free or tax-deferred for as long as possible. The HSA is the only account that allows us to make pre-tax contributions and withdraw them tax-free. Why then are we so willing to tap into our HSAs for medical expenses? Continue reading “Why You Should Treat Your HSA Like an IRA”

The Deadline to Reduce Your Tax Bill is Approaching

March 24, 2014

Time is running out to stay off of Uncle Sam’s naughty list and complete those income tax returns prior to the April 15th deadline. (Even if you choose to file an extension until October 15, 2014 taxes are still due by April 15 to avoid paying interest and penalties.) Beyond making sure you aren’t missing out on any itemized deductions or tax credits, there are still some moves you can make to reduce your tax bill or increase your refund. Last minute contributions to deductible IRAs and HSAs are two effective strategies to lower your 2013 tax bill (or increase your refund). Continue reading “The Deadline to Reduce Your Tax Bill is Approaching”

Why I Max Out My Health Savings Account (And You Should Too)

February 19, 2014
Updated June 14, 2017

When I worked as a 401(k) enroller, my regional sales manager (who happened to be my step-dad) used to demonstrate the tax advantages of the 401(k) by ripping a dollar bill into two pieces to show the effect of taxes on income. He would then go on to say that trying to save for retirement with after-tax money was the equivalent of saving only a portion of every dollar we earned and by putting that money in the 401(k), we got the benefit of the whole dollar instead.

Not only did this grab my attention—unless they are a magician you rarely expect someone to voluntarily rip dollar bills in half—but it drove home the idea that tax-deferred saving was better than saving after taxes.  There was only one problem: that money would eventually get ripped, figuratively speaking, when it was withdrawn in retirement. Continue reading “Why I Max Out My Health Savings Account (And You Should Too)”

The Cost of Raising My Colt

April 30, 2013

As a little girl, I dreamed of owning my own horse. My favorite book was Misty of Chincoteague and I even subscribed to Horse of Course magazine. I would beg my parents to get me a colt or pony but since they knew the ongoing expense, I would never get my wish.  According to petplace.com, it can cost about $10,000 a year to keep a horse, including boarding, vet bills, feed, etc.  The average lifespan of a horse is around 25 years so you can do the math and see that it would be VERY expensive. Continue reading “The Cost of Raising My Colt”

The Intersection of Health and Wealth Planning

August 21, 2012

An interesting topic I heard repeatedly at this month’s ISCEBS Symposium in San Francisco had to do with the concern of future health care costs becoming a critical variable in the retirement income equation.  Several of the major plan providers held sessions that focused on the next generation of retirement planning tools that will be needed to recognize and personalize health-related issues.  By now, most of us have heard the estimate of close to a quarter million dollars that a 65 year old married couple may face in out-of-pocket health costs throughout the rest of their lives.  But since that’s an average, some will need much more. Some will need much less.   This will depend on the health and medical needs of the retired couple, so that is why Putnam Investments has recently introduced a new retirement calculator that incorporates 7 data points from a health risk assessment into the income needs formula to estimate future projected healthcare expenses.  Continue reading “The Intersection of Health and Wealth Planning”