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Old 12-01-2013, 01:33 PM   #41
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When do you contribute to your HSA?:
I have it set up so a monthly auto transfer is made between my checking and HSA account. Just set it up once and don't have to worry about it other than changing the amount if the contribution limit increases.
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Old 12-01-2013, 03:23 PM   #42
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We usually contribute to our HSA either at the end of the calendar year or by 4/15 of the next year, whenever we can come up with the money.


Regarding the question of the $9000 in subsidies, this is the amount we qualified for on HealthCare.gov to subsidize our health insurance premium. The reason we qualify for the subsidies is that we can get our adjusted income below the cut off for subsidies by deducting our HSA contribution. The Affordable Care Act rules allow a deduction for HSA contributions in determining adjusted gross income.

After the subsidy, our insurance premium for our HSA policy will be $163 each per month, we had been paying around $500 each for basically the same health insurance policy.
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Old 12-01-2013, 05:08 PM   #43
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When do you contribute to your HSA?:
  • Monthly - for each month that I am eligible.
  • In December for the current year.
  • In April (or when I file my taxes) for the prior year.
  • In January for the full (current) year as I am confident my insurance situation won't change.

Just curious.

I don't expect our insurance to change during the year, but just to be safe we may contribute monthly which would give us the advantage of averaging in assuming some of it is directed to long-term investments. There may be account minimums we have to meet that would delay this approach.

OR we could wait until Dec (or the next April) for a year we know we are eligible for the entire year and contribute the full annual amount then. This is simpler.

I don't think I'm comfortable contributing in Jan for the current year because who knows what could happen during the year?
I contribute the allowable amount in early January so I can get the cash invested asap. I guess if you are not sure whether your situation will change during the year, it makes sense to go monthly or end of year. I use HSA Bank and move the funds to a linked TD Ameritrade account as soon as possible.
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Old 12-02-2013, 09:59 PM   #44
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Thanks for the answers!
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Old 05-07-2014, 09:14 PM   #45
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Should have done this a month ago!!!! but am going to set up an account with HSA Administrators tomorrow as I have some "eligible expenses" coming up next week.

Not that I intend to pay for them from the HSA this year, but I want the flexibility in the future to pay for any expenses incurred from now on.
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How our HSAs saved us over $10,000
Old 05-09-2014, 09:59 AM   #46
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How our HSAs saved us over $10,000

This is our first year with an HDHP with an HSA. I opened the HSA account in early January and I'm sending money to it in chunks. So far I've contributed $4000 toward our allowed $7550 (family plan over age 50).

I picked HSA Administrators and it's all in VTSAX (Vanguard Total Stock Market). I had some fun researching other available funds and may spread it around.

We've had about $800 in expenses and just cash flowed those instead of using the HSA. So far I'm finding the HDHP with a very low premium is working well for us.
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Old 05-09-2014, 10:19 AM   #47
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I finally convinced myself a couple months ago that my HSA money isn't medical money, but part of my investments, so I used half of it to buy Chevron stock. Well it immediately jumped 10% in a little over a month, so I sold it because I told myself you just captured 10 years worth of interest in 1 month. Ok... Now what am I going to do? I am going to have to buy some mutual funds so I don't do this buying and selling impulse thing.


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Old 05-09-2014, 11:45 AM   #48
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I had to think a while of how to count the HSA money, since putting money into an account isn't an "expense" even though it's being pulled out of short-term funds. I finally realized that the HSA accounts also count as short-term funds, since the money is available, whenever we need it, to pay any medical bills incurred in the future. So they are really just part of our extra "padded" pile of short-term monies.

Haven't put money away in "savings" in so long I forgot how to count it! LOL!
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Old 05-09-2014, 01:04 PM   #49
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I view contributions to our HSA the same as contributions to a Roth IRA while I was working - just a transfer of funds from taxable accounts to a tax-free account.
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Old 05-09-2014, 01:34 PM   #50
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I view contributions to our HSA the same as contributions to a Roth IRA while I was working - just a transfer of funds from taxable accounts to a tax-free account.

I read a post from Bogleheads that really rang true with me concerning HSA's. He said did you get one for your health, or did you get it for the tax deduction. If you got it as a tax deduction then treat it like it is part of your portfolio. I just need to keep having no medical expenses to make this process a no brainer.


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Old 05-09-2014, 02:26 PM   #51
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I view contributions to our HSA the same as contributions to a Roth IRA while I was working - just a transfer of funds from taxable accounts to a tax-free account.
Yea, but the HSA contributions are pre-tax dollars.
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Old 05-09-2014, 02:39 PM   #52
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Yea, but the HSA contributions are pre-tax dollars.
Yes when you are working for contributions from pay are pre-tax dollars and in a backwards way when you are retired in that you get a deduction from AGI for them.
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Old 05-09-2014, 04:15 PM   #53
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Great thread ... got me thinking differently. My original plan was to run medical expenses through the HSA, but not use it as an investment account. But that is wrong headed thinking! Maxing the HSA is a given. The question is how to take the most advantage of it. Say I took 7550 and put it in an HSA and took another 7550 and put it in another bank account. Now I have the choice of spending on medical from either. Do I want to keep a big balance in the regular account, and pay taxes on the interest? Or do I want to keep a big balance in the HSA account and not pay taxes on the interest? The latter, of course. As long as you non medical expenses can be managed without the assistance of the HSA funds, those funds should be spared from spending.
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Old 05-09-2014, 04:53 PM   #54
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Great thread ... got me thinking differently. My original plan was to run medical expenses through the HSA, but not use it as an investment account. But that is wrong headed thinking! Maxing the HSA is a given. The question is how to take the most advantage of it. Say I took 7550 and put it in an HSA and took another 7550 and put it in another bank account. Now I have the choice of spending on medical from either. Do I want to keep a big balance in the regular account, and pay taxes on the interest? Or do I want to keep a big balance in the HSA account and not pay taxes on the interest? The latter, of course. As long as you non medical expenses can be managed without the assistance of the HSA funds, those funds should be spared from spending.

Just keep those receipts when paying out of pocket to get to the money tax free whenever needed. Already in 4 years I have probably $1000 in medical receipts from dental cleanings and a few doctor physicals. I just hope the ink doesn't fade on them, because I am not planning on taking the money out for hopefully 20 years.


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Old 05-13-2014, 07:41 AM   #55
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...because I am not planning on taking the money out for hopefully 20 years.
The first benefit comes when the money goes in. And of course you get that whether you spend it on HC right away or not. But to get the second benefit you need to wait until you have a bunch of tax free income in the account. But like you say, you keep the receipts and you control the timing.

The bad news for me is that it complicates the 'where to spend from' decision. I have tIRA,401k, Roth, variable annuity, after tax, and now HSA. And they all have slightly different tax consequences when the funds are pulled out. Since my after tax fraction is small, I don't have anywhere near 20 years before I need to decide where to dip in. At least it's not 2014!
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Old 05-13-2014, 11:22 AM   #56
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The first benefit comes when the money goes in. And of course you get that whether you spend it on HC right away or not. But to get the second benefit you need to wait until you have a bunch of tax free income in the account. But like you say, you keep the receipts and you control the timing.

The bad news for me is that it complicates the 'where to spend from' decision. I have tIRA,401k, Roth, variable annuity, after tax, and now HSA. And they all have slightly different tax consequences when the funds are pulled out. Since my after tax fraction is small, I don't have anywhere near 20 years before I need to decide where to dip in. At least it's not 2014!

Remember you can also withdraw tax free the HSA funds to pay Medicare premiums for the rest of your life. Now, you have an added reason to live a long life in retirement....efficient tax withdrawal mechanism of HSA funds. .... My taxes in retirement are basic and fixed at the top end of 25% bracket, so anything I can delay or not have to withdraw, I am not.


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HSA Plans
Old 05-13-2014, 01:46 PM   #57
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HSA Plans

Could someone please tell me... when on an HSA plan do you pay the full retail cost of each of your meds as if you had no insurance at all? If so, it seems there would be a breakeven point where it would be better to forego the HSA for a high deductible silver plan that would have e.g a $25 charge for generic perscriptions. Has anyone seen this type of analysis published or perhaps in another ACA thread here?
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Old 05-13-2014, 02:07 PM   #58
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Could someone please tell me... when on an HSA plan do you pay the full retail cost of each of your meds as if you had no insurance at all? If so, it seems there would be a breakeven point where it would be better to forego the HSA for a high deductible silver plan that would have e.g a $25 charge for generic perscriptions. Has anyone seen this type of analysis published or perhaps in another ACA thread here?
With our HDHP/HSA insurance everything still gets submitted to insurance just like any other insurance. Until we reach the deductible they pass along the bill to us to pay. It's a negotiated price.

The drug portion of the insurance seems very similar to what we had when I worked for megacorp. I'm not all that familiar with the drug plan since I don't take any prescription drugs, but my DW takes one daily pill and she gets it in generic form from a mail-order vendor and it costs the same as we paid before. (I know her monthly order is only currently $11.27 for a one month supply)

Of course this plan isn't available to anyone any more, so you should really check specific plans for specific details.
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Old 05-13-2014, 02:14 PM   #59
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With our HDHP/HSA insurance everything still gets submitted to insurance just like any other insurance. Until we reach the deductible they pass along the bill to us to pay. It's a negotiated price.
Our experience as well. Prescriptions must filled in network and are negotiated rates.
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Old 05-13-2014, 02:41 PM   #60
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Now what am I going to do? I am going to have to buy some mutual funds so I don't do this buying and selling impulse thing.
I think you should start day trading in your HSA and write a book about it. ;-)

Seriously- I also got into the mindset that it's an investment account, even though I had 2 dental implants put in this year and the money would have come in handy. Since I retired mid-year (last day was last Friday but paid through 7/1), our out-of-pocket medical/dental expenses are actually going to exceed the IRS threshold for deductibility, which helps. (DH is 75 so the lower 7.5% applies.)
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