September 5, 2013
WE ALL KNOW WHERE WE'RE HEADED:
A Rx for retirement: HSAs (Stephanie AuWerter, 9/04/13, Money)
How would you like a triple-tax-free way to save for certain retirement expenses?No, this isn't the latest Nigerian email scam. Rather, it's the very real advantage of a Health Savings Account (HSA), an investment vehicle available to those with qualifying high-deductible health insurance plans.The pretax money you put in is meant to be used for that year's unreimbursed health costs, but unspent funds can be rolled forward to grow tax-deferred and withdrawn tax-free at any later date to pay for health care.After 65, you can also tap the account for nonmedical expenses without penalty; those withdrawals will be taxed as income just like a traditional IRA.Considering that a 65-year-old couple leaving the workforce today can expect to spend $220,000 on health care, as Fidelity reports, it's no wonder HSAs are gaining traction as a retirement savings tool. "They're the best deal in town," says Scottsdale, Ariz., financial planner Dana Anspach, author of Control Your Retirement Destiny.
Posted by Orrin Judd at September 5, 2013 4:57 PM