Navigating confusing Health Saving Plan

[sgfgrover15]

I am hoping someone can point me in the right direction since I seem to have myself confused.

When we retire in November, 2014 we have full health insurance coverage for life through our state employer at our current rate. What I am looking for is a "hopefully" tax free medical savings account that we can roll our deferred compensation into for things like dental, vision, larger co-pays, health insurance premiums, unexpected medical issues, etc

We are planning with a financial adviser soon but I did want to be aware of my options before we go so that we can be as informed as possible. We will be 45 and 47 when we retire.

Any links or specific type plans for me to research would be appreciated. Everything I seem to be finding is for folks still working and done through the employer or for retired folks over 65.

If this is an often asked question I apologize, I have tried to find previous posts referring to this specifically.

Lynne

 

[pb4uski]

I'm not aware of anything where someone can roll deferred comp into tax-free. You wouldn't want to do that anyway since you would have a huge tax bill.

Usually you roll from tax-deferred (like your deferred comp plan) into tax-deferred (like a taxable IRA).

Then later, you can roll money from the taxable IRA to a Roth IRA (and pay the tax). The Roth is then tax free.

While you can contribute to a health savings account (aka HSA) even if you are retired, in order to di so your health insurance plan needs to be "HSA-eligible" and I suspect your employer plan may not be HSA-eligible. Something you could check into though.

 

[sgfgrover15]

Thank you for the reply. So I guess I wasn't as confused as I thought. I was coming up with the same type of answer you provided. Our insurance plan is not hsa eligible so I was looking for an alternative.

I guess we will just continue to do our own health savings plan for future needs.