HSA?

[Fireup2020]

I am reading a lot about folks having HSA's.

As a state employee, we have the option to put money into one of these. My question is: Who really needs this (ok, advice requested if you think I might need this). When I retire from the state, I will maintain my next to free health ins (BC/BS) - and am eligible for health care through the VA (prefer the VA actually!) due to my disability ratings. Also, at age 60, will be entitled to military retiree health care too (but with its own red tape issues and costs) Your 2 cents worth is welcome.

Also, please review my earlier post about my FireCalc issues and savings questions. Thanks!

 

[REWahoo]

JeninNJ,

Have you considered that you can use HSA savings as an additional way to put aside tax deferred money towards retirement? It can function like a traditional IRA even if you don't use the money for medical expenses.

 

[2B]

JeninNJ,

Have you considered that you can use HSA savings as an additional way to put aside tax deferred money towards retirement? It can function like a traditional IRA even if you don't use the money for medical expenses.

This is the principal reason I have one. You can use it to pay current medical expenses like a FSA that won't expire but I use mine as a way to tax defer more money. When I no longer have earned income, I'm sure I'll still have medical expenses to spend it on.

 

[Fireup2020]

Will I be able to pull the money out at a later date if not used for medical expenses?

 

[REWahoo]

Will I be able to pull the money out at a later date if not used for medical expenses?

Yes, but you will have to pay taxes on the money if is not used for medical or other qualified expenses.

Here is a good overview of HSA's that can provide you with an understanding on how the program works: http://www.hsaadministrators.com/forms/hsa-basics.pdf

 

[jdw_fire]

As a state employee, we have the option to put money into one of these. My question is: Who really needs this (ok, advice requested if you think I might need this). When I retire from the state, I will maintain my next to free health ins (BC/BS) - and am eligible for health care through the VA (prefer the VA actually!) due to my disability ratings. Also, at age 60, will be entitled to military retiree health care too (but with its own red tape issues and costs) Your 2 cents worth is welcome.

Actually, given all your insurance I don't think you qualify. To qualify, the ONLY medical insurance you can have is a high deductable insurance policy. You can't be on Medicare or someone else's non high deductable policy.

 

[Ibid]

Here is a good overview of HSA's that can provide you with an understanding on how the program works: http://www.hsaadministrators.com/forms/hsa-basics.pdf

That's a good general overview, but it's a bit out of date due to changes recently made to the HSAs.

 

[eridanus]

"Additional tax. There is an additional 10% tax on the part
of your distributions not used for qualified medical expenses.

[...]

Exceptions. There is no additional tax on distributions
made after the date you are disabled, reach age 65, or die."

http://www.irs.gov/pub/irs-pdf/p969.pdf

 

[REWahoo]

That's a good general overview, but it's a bit out of date due to changes recently made to the HSAs.

True. I was unable to locate a good summary of HSA ins and outs updated to include the latest changes. JeninNJ apparently could benefit from an overview, so I linked this which does cover the basics. If you have something better you can link, fire away....