Thank you! Very educational to my wife and I, good information to know, it brings up a question we have for you, we will have to it into words, and see if you can answer it or steer us in right direction. 👍
Hi Howard, as you mentioned having to much $$ is a good problem. I'm in a similar situation where I am using my HSA to fund my Medicare premiums, copays, deductibles, etc. for now I'm not focusing on the amount as I've build my budget to be funded for medical expenses solely from my HSA. I will revisit it when I turn 80 to see if I want to bight the bullet and just liquidate some of it deal with the taxes. Its really just a mindset problem. I suggest you just focus on the "why" you started your HSA at the beginning and if it more then meets your current and future needs, then grab the extra cash now even with the tax consequence and find a new mission for those $$. Could be a more investments, a nice vacation, a new softball glove, etc. Its just gravy at this point.
@@RetirementTalk43 So, hypothetically, if you had $10k of HSA remaining with no eligible medical expenses ever to use them for you would forfeit the funds entirely? That's like throwing $$ out the window.
I did the hsa once at work. On my plan, the amount you had saved would be forfeited at the end of the year until there were omly a few weeks left. So I went shopping for ibuprofen, vitamins, bandaids etc, to get some use out of it. That was the only year I participated. I retired with a pension a few hundred less than when I worked because my medical 8nsurace was through my former employer. I will start collecting social security at 70. I invested in another deferred compensation plan through my former employer, and a traditional Ira on my own. I also saved cash from my net for home repairs and to cover me until social security. I was saving about 10,000 a year. It turns out I am still saving close to that amount from my pension. But I have a long list of home repairs to do. I have learned to live so inexpensively, well you know.
Interesting and informative video. I don’t usually see much information about HSAs on the internet. My coworker commented to me once about all the money he was blessed to have in his HSA but my wife has always had health issues and kept mine drained. I pray that you and your wife continue to be blessed with good health and never need to use that money. Chances are likely that if we live long enough, we will need nursing home care eventually and that will empty your HSA in less than a year. If you were a Christian, you could have a goal of using your abundance of wealth to further God’s kingdom on earth. A lot of non Christian people also believe in giving out of their abundance to help people less fortunate than themselves. I knew someone who had health issues later in life that prevented him from doing anything physical. He told me that he was thankful that he had saved his money so that he still was able to contribute something toward the causes that he believed in. We all need a sense of purpose in our life or we risk losing the will to live. Please don’t respond to this comment, but I appreciate you letting me express my personal opinion. Thank you
I am in a similar situation. However, I don’t have LTC insurance, so I consider my HSA my LTC insurance. There’s also a concern about very expensive drugs I may need in the future that aren’t covered by my part D plan. I also don’t have dental insurance or vision care insurance. When I get cataract surgery someday I can splurge on the fancy lenses. Your HSA can also be used for IRMAA. And worst case, treat it like an IRA with no RMD requirement. You’ll pay taxes, but no penalty if you’re 65+.
I admittedly am not fully up to speed on Medicare plans but couldn’t you just make a minor adjustment to part of your plan to potentially use some of the HSA? For example, change your gap plan to something with a deductible while giving you a lower monthly price? Next, if you do decide to just draw cash out doesn’t it then work just like an IRA where it’s just taxable income? In that case there really was never a downside to having it because you got your company match and you always had the possibility of using it for medical without paying any taxes. I never had an HSA either. With my particular health insurance/tax situation and no employer match or plan, it never made sense to me to start one.
Failure: Yeah, switching to the high deductible Medigap plan would solve the HSA "problem" but, as I stated in the video, I am saving a lot of money with the no-deductible plan.
Jiust: No, it was actually a plan to keep the HSA in place as long as possible and let the investments grow tax free and use after tax savings to pay health care costs.
I believe at 65 or 67 you can start using it like a regular IRA paying income tax on withdrawls. At least that gives you a way of using it up, if that's your concern.
@@RetirementTalk43: If you or your spouse can't use the money, it'll be taxable income to your heirs. Uncle Sam will still get to take his bite, I keep a nice Google Spreadsheet with links to bills I have paid that will allow me take future non-taxable cash out. I know you mentioned that you also did this but don't have all of your receipts.
My HSA is about $55K currently (age 61) with most of it in the s&p500 index fund at Fidelity. I'm in a high deductible plan (pre-medicare retiree) from my former employer, I'm thinking for the next ~ 4 yrs. it's about the time of year I think about an IRA withdrawal to "tax out" the money and then in January add it to the HSA...LOL, it's stupid to me that you can't just slide it from IRA to HSA (You can do that ONCE in life, not every year). I haven't used much healthcare $$$ in my life so far, and I was wondering myself how useful it is once on Medicare...But you can use it for all kinds of stuff, for example, I happen to like Oakley glasses...Yes they are $$$, and I run around in basically t-shirts and cargo shorts so maybe it doesn't match, they are something I like to splurge on...But also dental work, the plans we typically get don't pay all that much...I remember my mom a couple of years before she passed had some $15K in work done, that I covered at the time...And you can use it for a lot of OTC stuff too...Worst case it's treated like a traditional IRA if you use it for anything other than medical related...I was planning on contributing the next 3 yrs at least (it's kind of weird the year you turn 65 so I'm thinking just avoid that and avoid the worry...
@@RetirementTalk43 You can use the funds from your HSA to pay healthcare costs, including your Medicare premiums. Qualified medical expenses include: Medicare Part B premiums Medicare Part C premiums Medicare Part D premiums deductibles for all parts of Medicare copayments and coinsurance costs for all parts of Medicare dental expenses vision expenses insulin and diabetes supplies over-the-counter medication
YES you can save too much money......true story, when I paid off my home, I had all this extra money. I setup my autotransfer to my brokerage accounts.........I overdrew my checking account twice because I was investing too much money....🤣.
Howard, yes it is a hard situation to be in. However, the money isn't gone since once you hit 65 you can take it out of the plan and use it for anything although the withdrawal is then taxable. An HSA is not a problem that I have because I never had bad enough health insurance to qualify for an HSA. The more general problem is that a retiree continues to add to savings after retirement and gets to the point where the savings simply can't be spent without radical (undesirable) changes to lifestyle. That is an issue particularly when a retiree has no children or anyone/thing they want to leave money to. It happens more often than you might think partly because it can be hard to transition from saving to spending. I know I have not been able to make the transition which has caused my retirement savings to blow up. That said, I live a very comfortable life and do whatever I want. I have cut back though and now only have one yacht, but that simply made the problem worse.
Todd: An HSA is not the result of bad health insurance. You just need to be in a high deductible plan in order to contribute. I will never pay taxes on that money.
@@RetirementTalk43 I consider a plan with a high deductible bad insurance. In my case I always had zero copays, zero coinsurance and zero deductible. So what will you do if you can't spend it on healthcare and you outlive your wife? I guess you will let your heirs pay the tax due. If the money outlives you and your wife, the government will get the tax money. Personally, I would do what I could to minimize the taxes due on the money via tax planning. It is not a problem I have so I have not looked into the details of taxation for heirs.
@@todddunn945 When I was working and choosing health insurance plans, I would calculate what I would spend under each plan, in a worst case scenario. In that calculation, I included tax savings from the HSA plan. It was always the case, that I ended up spending less under the high deductible plan. Now I know that won't always be the case, depending on several factors, including how much of the premiums are covered by your employer. Between me and my wife, I'll figure out a way to utilize all those HSA funds.
I had an HSA, but I used mine up. First on my wife because she was in poor health and then on me for an MRI procedure two years ago. I think I might have a $1 in there now.
@@RetirementTalk43 I'll probably have that much in HSA when I retire in a few years - I think it will all get used in Medicare premiums and other medical expenses before the end - so not too worried.
Yikes, my Texas Plan N is $122/mo. I don't have an HSA but thought I read after 65 it loosens on reasons for getting money out, as in not medical only. It's probably something you've researched already. Also, isn't there a way to convert the funds somewhere else? I wish I recalled who discussed that angle. Regardless, too much is way better than not enough. You won't lie in bed thinking about how am I going to afford . . . whatever. A much better problem. 😀
I can't get an HSA, I have one of those Cadillac plans at work, which is great now. I have zero premiums, nothing is deducted from my paycheck for my company plan, makes it hard to retire 😂😂😂.
Why are you worrying about it? So the money is there if and when you need it. And if it is still there when you die, who cares? You can always cash it in and pay the taxes. Forgetaboutit?@@RetirementTalk43
Two things come to mind: 1) After age 65, HSA funds can be used for non-medical expenses - you just pay income tax similar to other retirement savings; 2) They say that 20-30% of lifetime medical costs happen in the last year of our lives. So save 30% for that last year ;-)
My wife started an HSA account at her job a few years back. It’s not working for us. She doesn’t make enough or have enough years left combined with her pre existing health problems constantly draining the account. I think we are going to opt out this year.
@@52CA The point of an HSA, if you can, is to not spend any of it until you are well into retirement. Use after tax savings to pay health care bills until then.
@ Well I’m retired with zero income and she makes 1500.00/month take home. Plus our 2 kids are on her insurance still. That will change soon. We do have substantial savings but not taking from it if at all possible.
Thank you! Very educational to my wife and I, good information to know, it brings up a question we have for you, we will have to it into words, and see if you can answer it or steer us in right direction. 👍
Okay.
@@RetirementTalk43 We googled our questions and it answered it. LOL Many thanks for the videos. LOVE the doggies. Happy Thanksgiving!!
Start using it ASAP !
Start using what?
Absolutely love this content. Anything left will go to my kids'
Thanks Ralph.
As I recall, using HSA funds for non-medical expenses is simply taxable income once you reach age 65 - view it as an IRA with no RMDs.
NEVER!!!!!
Hi Howard, as you mentioned having to much $$ is a good problem. I'm in a similar situation where I am using my HSA to fund my Medicare premiums, copays, deductibles, etc. for now I'm not focusing on the amount as I've build my budget to be funded for medical expenses solely from my HSA. I will revisit it when I turn 80 to see if I want to bight the bullet and just liquidate some of it deal with the taxes. Its really just a mindset problem. I suggest you just focus on the "why" you started your HSA at the beginning and if it more then meets your current and future needs, then grab the extra cash now even with the tax consequence and find a new mission for those $$. Could be a more investments, a nice vacation, a new softball glove, etc. Its just gravy at this point.
michael: I will never pay taxes on those HSA funds. Never, never, never!!!
@@RetirementTalk43 So, hypothetically, if you had $10k of HSA remaining with no eligible medical expenses ever to use them for you would forfeit the funds entirely? That's like throwing $$ out the window.
@@michaelsd284 No, you can still withdraw them but they would be taxable.
You should check what is eligible. Living in Iowa we have Radon gas Radon remediation is reimbursable. Who knew?
chris: Yes, shockingly, if you can show medical cause, Radon remediation IS covered.
My financial advisor SS Timmy
told me to give him all my money and he would double it overnight
The only thing he doubled were 8 Jack and Cokes😂
I’d rather have the stupid problem of having too much in retirement than the alternative any day. 😂
Yep.
I did the hsa once at work. On my plan, the amount you had saved would be forfeited at the end of the year until there were omly a few weeks left. So I went shopping for ibuprofen, vitamins, bandaids etc, to get some use out of it. That was the only year I participated.
I retired with a pension a few hundred less than when I worked because my medical 8nsurace was through my former employer. I will start collecting social security at 70. I invested in another deferred compensation plan through my former employer, and a traditional Ira on my own. I also saved cash from my net for home repairs and to cover me until social security. I was saving about 10,000 a year.
It turns out I am still saving close to that amount from my pension. But I have a long list of home repairs to do. I have learned to live so inexpensively, well you know.
leisure: That was an FSA plan, not an HSA. HSA is not a "use it or lose it" plan.
Interesting and informative video. I don’t usually see much information about HSAs on the internet. My coworker commented to me once about all the money he was blessed to have in his HSA but my wife has always had health issues and kept mine drained. I pray that you and your wife continue to be blessed with good health and never need to use that money. Chances are likely that if we live long enough, we will need nursing home care eventually and that will empty your HSA in less than a year. If you were a Christian, you could have a goal of using your abundance of wealth to further God’s kingdom on earth. A lot of non Christian people also believe in giving out of their abundance to help people less fortunate than themselves. I knew someone who had health issues later in life that prevented him from doing anything physical. He told me that he was thankful that he had saved his money so that he still was able to contribute something toward the causes that he believed in. We all need a sense of purpose in our life or we risk losing the will to live. Please don’t respond to this comment, but I appreciate you letting me express my personal opinion. Thank you
Here is a thought. Can you use the HSA for vet bills?
No. Unless you are married to your pet at the time of making contributions to your HSA.
I am in a similar situation. However, I don’t have LTC insurance, so I consider my HSA my LTC insurance. There’s also a concern about very expensive drugs I may need in the future that aren’t covered by my part D plan. I also don’t have dental insurance or vision care insurance. When I get cataract surgery someday I can splurge on the fancy lenses. Your HSA can also be used for IRMAA. And worst case, treat it like an IRA with no RMD requirement. You’ll pay taxes, but no penalty if you’re 65+.
ran: I'll die before I pay any taxes on the money :).
Use what you can and you can always use it for Long-term Care or LTC Insurance premiums.
jeff: I hate to have to hope for LTC just to spend that money but, yeah, that would certainly solve the problem.
I admittedly am not fully up to speed on Medicare plans but couldn’t you just make a minor adjustment to part of your plan to potentially use some of the HSA? For example, change your gap plan to something with a deductible while giving you a lower monthly price?
Next, if you do decide to just draw cash out doesn’t it then work just like an IRA where it’s just taxable income? In that case there really was never a downside to having it because you got your company match and you always had the possibility of using it for medical without paying any taxes.
I never had an HSA either. With my particular health insurance/tax situation and no employer match or plan, it never made sense to me to start one.
Failure: Yeah, switching to the high deductible Medigap plan would solve the HSA "problem" but, as I stated in the video, I am saving a lot of money with the no-deductible plan.
Can you use it for dental and vision costs?
chris: Yes. There is hope!!
What I think is stupid is that the government won’t let you pay your Medigap premiums with your HSA.
Great video . Do u live in Florida? What supplement do u carry a plan N ?
Louis: Yes, Florida. I have a plan G.
If you don't spend it then that means you have been healthy... So really that's a win!!! And it's there if you or your wife ever needs it.
Jiust: No, it was actually a plan to keep the HSA in place as long as possible and let the investments grow tax free and use after tax savings to pay health care costs.
I believe at 65 or 67 you can start using it like a regular IRA paying income tax on withdrawls. At least that gives you a way of using it up, if that's your concern.
FJ: I'll go kicking and screaming before I ever pay taxes on that HSA money!!!
@@RetirementTalk43: If you or your spouse can't use the money, it'll be taxable income to your heirs. Uncle Sam will still get to take his bite,
I keep a nice Google Spreadsheet with links to bills I have paid that will allow me take future non-taxable cash out. I know you mentioned that you also did this but don't have all of your receipts.
My HSA is about $55K currently (age 61) with most of it in the s&p500 index fund at Fidelity. I'm in a high deductible plan (pre-medicare retiree) from my former employer, I'm thinking for the next ~ 4 yrs. it's about the time of year I think about an IRA withdrawal to "tax out" the money and then in January add it to the HSA...LOL, it's stupid to me that you can't just slide it from IRA to HSA (You can do that ONCE in life, not every year). I haven't used much healthcare $$$ in my life so far, and I was wondering myself how useful it is once on Medicare...But you can use it for all kinds of stuff, for example, I happen to like Oakley glasses...Yes they are $$$, and I run around in basically t-shirts and cargo shorts so maybe it doesn't match, they are something I like to splurge on...But also dental work, the plans we typically get don't pay all that much...I remember my mom a couple of years before she passed had some $15K in work done, that I covered at the time...And you can use it for a lot of OTC stuff too...Worst case it's treated like a traditional IRA if you use it for anything other than medical related...I was planning on contributing the next 3 yrs at least (it's kind of weird the year you turn 65 so I'm thinking just avoid that and avoid the worry...
ph: As I said, it is a good problem to have and I'll figure it out.
@@RetirementTalk43 You can use the funds from your HSA to pay healthcare costs, including your Medicare premiums.
Qualified medical expenses include:
Medicare Part B premiums
Medicare Part C premiums
Medicare Part D premiums
deductibles for all parts of Medicare
copayments and coinsurance costs for all parts of Medicare
dental expenses
vision expenses
insulin and diabetes supplies
over-the-counter medication
YES you can save too much money......true story, when I paid off my home, I had all this extra money. I setup my autotransfer to my brokerage accounts.........I overdrew my checking account twice because I was investing too much money....🤣.
yikes!
Howard, yes it is a hard situation to be in. However, the money isn't gone since once you hit 65 you can take it out of the plan and use it for anything although the withdrawal is then taxable. An HSA is not a problem that I have because I never had bad enough health insurance to qualify for an HSA.
The more general problem is that a retiree continues to add to savings after retirement and gets to the point where the savings simply can't be spent without radical (undesirable) changes to lifestyle. That is an issue particularly when a retiree has no children or anyone/thing they want to leave money to. It happens more often than you might think partly because it can be hard to transition from saving to spending. I know I have not been able to make the transition which has caused my retirement savings to blow up. That said, I live a very comfortable life and do whatever I want. I have cut back though and now only have one yacht, but that simply made the problem worse.
Todd: An HSA is not the result of bad health insurance. You just need to be in a high deductible plan in order to contribute. I will never pay taxes on that money.
@@RetirementTalk43 I consider a plan with a high deductible bad insurance. In my case I always had zero copays, zero coinsurance and zero deductible. So what will you do if you can't spend it on healthcare and you outlive your wife? I guess you will let your heirs pay the tax due. If the money outlives you and your wife, the government will get the tax money. Personally, I would do what I could to minimize the taxes due on the money via tax planning. It is not a problem I have so I have not looked into the details of taxation for heirs.
@@todddunn945 When I was working and choosing health insurance plans, I would calculate what I would spend under each plan, in a worst case scenario. In that calculation, I included tax savings from the HSA plan. It was always the case, that I ended up spending less under the high deductible plan. Now I know that won't always be the case, depending on several factors, including how much of the premiums are covered by your employer.
Between me and my wife, I'll figure out a way to utilize all those HSA funds.
How about donating it to a good cause after the age of 65.
tom: There are still plenty of years for my wife and I to try and utilize all that money.
I had an HSA, but I used mine up. First on my wife because she was in poor health and then on me for an MRI procedure two years ago. I think I might have a $1 in there now.
Bill: Leave it there to let it grow.
You can use the money like an IRA after age 65 you just have to pay taxes on the money you take out, but the dog was entertaining for sure.
Dan: Neither I nor my dogs will ever pay taxes on that money!!! Never, never, never.
@@RetirementTalk43 I'll probably have that much in HSA when I retire in a few years - I think it will all get used in Medicare premiums and other medical expenses before the end - so not too worried.
Yikes, my Texas Plan N is $122/mo. I don't have an HSA but thought I read after 65 it loosens on reasons for getting money out, as in not medical only. It's probably something you've researched already. Also, isn't there a way to convert the funds somewhere else? I wish I recalled who discussed that angle. Regardless, too much is way better than not enough. You won't lie in bed thinking about how am I going to afford . . . whatever. A much better problem. 😀
edward: Yes, it is not a BAD problem.
Should a single male Start a HSA even though I’m retired @ 62?
john: You can only start an HSA if you are in a qualified high deductible health plan.
@ Medicare 😉👍
I can't get an HSA, I have one of those Cadillac plans at work, which is great now. I have zero premiums, nothing is deducted from my paycheck for my company plan, makes it hard to retire 😂😂😂.
Switch back to your high deductible plan
And use your HSA to cover your medical expenses
It is something I will have to think about.
@
Nursing home expenses, long term health care?
@@sharonoleary9935 That would do it but, I'm not really hoping for that.
Yeah nobody does
Forgetaboutit!!! 😊
Huh?
@@RetirementTalk43East Coast expression. Did they not show you "The Sopranos" in Chicago?
@@pensacola321 I know the expression. I just wasn't sure to what you were referring.
Why are you worrying about it? So the money is there if and when you need it. And if it is still there when you die, who cares? You can always cash it in and pay the taxes. Forgetaboutit?@@RetirementTalk43
Two things come to mind: 1) After age 65, HSA funds can be used for non-medical expenses - you just pay income tax similar to other retirement savings; 2) They say that 20-30% of lifetime medical costs happen in the last year of our lives. So save 30% for that last year ;-)
comment: Well, I refuse to pay taxes so I will just have to live long enough to have enough in part B premiums.
@@RetirementTalk43 You _are_ a lucky man! Me, I have an expensive hobby that involves flying.
I used my HSA to buy a couple nice rifles several years ago, I’m not so sure the government has a good handle on it
Sure.
Don't shoot yourself in the foot there, Cletus.
First world problems LOL
Yep.
You definitely can save too much. By doing so, you waste years that could be spent in retirement.
kate: Yep, that's the trade off.
Buy a cheaper supplement, and use the HSA to pay the out of pocket... Voila!
pensacola: But I really came out ahead with the high premium, zero deductible plan.
82K today, is not that much money
falcon: In the context of my health care expenses and time remaining, it certainly is.
My wife started an HSA account at her job a few years back. It’s not working for us. She doesn’t make enough or have enough years left combined with her pre existing health problems constantly draining the account. I think we are going to opt out this year.
@@52CA The point of an HSA, if you can, is to not spend any of it until you are well into retirement. Use after tax savings to pay health care bills until then.
@ Well I’m retired with zero income and she makes 1500.00/month take home. Plus our 2 kids are on her insurance still. That will change soon.
We do have substantial savings but not taking from it if at all possible.
Please Get to Laughlin now.
The topp ssat 62 expert in the world has arrived.
Yawn!