Understanding the Benefits of Health Savings Accounts (HSAs)

Have you considered the role your HSA can play in your overall financial strategy? If you have a high deductible medical plan, there are some great advantages to starting a Health Savings Account.

For starters, contributions are not subject to federal income tax; the funds and interest earned are tax-free if used for qualified medical expenses. Also, the funds have no expiration date, meaning they remain in the account until needed. HSAs can also cover medical expenses for your spouse and dependents, even if your medical plan does not cover them. This type of account is also portable, meaning you can take it with you if you change employers or retire.

Individuals aged 55 or older can make an additional "catch-up" contribution. Withdrawals from an HSA for qualified medical expenses are tax-free, but any non-medical withdrawals before age 65 incur federal income tax and a penalty. After age 65, the IRS waives the penalty, but federal income tax still applies.1

HSA money is put away tax-free, accumulates tax-free, and is spent tax-free; this triple tax benefit is so unique that it stands out from other retirement investments. It’s worth looking into how an HSA can play into your long-term financial goals (just remember that once you begin taking Medicare, you can no longer contribute)1

Travel Tip

Travel Tip

Before international trips, take a wallet inventory

Storing important info can save a ton of time if your wallet gets lost while traveling. Jot down the numbers to call in case of lost or stolen cards, and make a xerox copy of all your ID info and cards, including the photo page of your passport, to tuck into your suitcase.

Thinking About Downsizing? Here’s What to Consider

As you approach retirement, fresh possibilities are on the horizon. Maybe the kids have moved out, that last day of work is coming up, and you’re looking at ways to simplify your life at home. If that sounds familiar, here are three downsizing details to think about.

1. Moving might be a bad idea. According to Hire Helper, 23 percent of retirees moved somewhere in 2024. For some, moving from a house into a condominium or 55+ community across town is the perfect next step. Others may be uprooting their lives entirely to live somewhere new, which is much more involved. If you decide to relocate after retirement, make sure to have a strategy for building a social support system in your new city or town.2,3
2. Start downsizing earlier than you think. Sorting and downsizing your possessions might be a big task, especially if you’ve accumulated a lot of possessions over the years. But putting it off only makes it harder. Start as soon as you can, and do a little at a time. Label any sentimental items you want to keep or pass on to others, and sell or donate anything you no longer need. Digitizing your essential documents can also save space. Starting early with downsizing can help make this task feel much more manageable and create some welcome breathing room, both in your home and your schedule.
3. Talk to the pros. Hiring professional help with your downsizing project could make a world of difference. Professional organizers are objective, won’t be phased or overwhelmed by the task, and can make a big dent in the job pretty quickly. Also, local charities are often happy to pick up items like old clothes, furniture in good condition, or even an extra car you no longer need.

Did You Know?

Did You Know?

Each coast could have had a Boston, but for a coin flip

In 1845, a new town emerged at the western end of the Oregon Trail. Two New Englanders flipped a coin; the winner would name the village after his hometown. A man from Portland, Maine, won out over a man from Boston, and Portland, Oregon, was born.4

On the Bright Side

On the Bright Side

Neighbors come together to create “Christmas in June” for a child.

Neighbors in Bethesda, Maryland, came together last June to create a happy holiday for a 9-year-old girl battling cancer. When Kasey Zachmann’s parents learned of the severity of her illness, they decided to turn June 28 (her diagnosis day) into a Christmas celebration. Kasey, a Christmas enthusiast, was delighted as members of her community decorated their homes with holiday lights despite the summer heat. Dressed in a Nutcracker-themed pink dress, Kasey enjoyed gifts and festivities and toured many decorated homes. Two dozen firetrucks, including Santa Claus riding an antique fire engine, also visited Kasey’s home that day. The Zachmanns even received virtual support in the form of holiday photos and videos made by well-wishers from around the world.5

Brain Teaser

Dan held a dinner party. For every two guests, he served a plate of chicken. For every three guests, he served a plate of rice. For every four guests, he served a dish of sauce. Given that he served a total of 65 dishes, how many guests did he have?