Maxed out your 401(k) plan? Here’s another way to save

Advisors


Thomas M. Barwick | Getty Images

Retiring baby boomers will more than double Medicare and Medicaid costs by 2020, according to industry data.

Retirement savers who have contributed the maximum to their 401(k) plans don’t have to look far for the next big growth opportunity for nest eggs: It’s right in their health-care plans.

Say hello to the health savings account, which works in tandem with high-deductible health insurance.

HSAs offer a triple-tax benefit: Assets in them grow free of taxes. Savers can contribute to them on a pretax or tax-deductible basis. Finally, account holders can tap the assets free of taxes, provided the money goes toward qualified medical expenses.

More from Investor Toolkit:
When a robo-advisor is, and isn’t, the right choice
Everything you need to know about target-date funds
Defer compensation now to build retirement wealth

Used wisely, HSAs are a new tool in retirement planning — and financial advisors can help with that.

“If you’re expected to spend $275,000 on health care in retirement, where can you get the most bang for your buck?” said Tom Vipond, sales consultant for TD Ameritrade Self Directed Plan Services.

Here’s where you can find the best opportunities for health savings accounts.



Source link

Products You May Like

Articles You May Like

More 3D printers, SpaceX leaders
Freeport-McMoRan could rally another 15 percent before hitting a wall
Don’t underestimate the impact of a trade deal
Three experts weigh in on Walmart as the company soars on earnings
Amazon changes reporting on physical stores

Leave a Reply

Your email address will not be published. Required fields are marked *