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It probably doesn't make a huge difference how you do it. My min-max approach is to maximize contributions into the HSA and not withdraw anything from it (leaving it to grow tax free as investments). I just pay all my expenses with a rewards credit card. Tracking unreimbursed expenses opens up the possibility to withdraw those funds if necessary later tax free. Going all or nothing like this actually makes it quite a bit easier to track expenses. My healthcare insurance website handily tracks my yearly out of pocket amounts spent for prescriptions and healthcare, and since I haven't reimbursed any of those expenses I can just take that whole report as a "receipt" for the year.
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Jan 26, 2023 19:17
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If you scan the receipts as you get them and drop them in a google drive it's probably safe for 20 years.
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Jan 26, 2023 19:45
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hobbez posted:“wow! No more medical bills and I have ALL THIS MONEYYYY” I will maintain perfect health until my 72nd birthday, at which time I will cash out all my accounts, put the money in a duffel, and walk into the ocean
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Jan 26, 2023 20:22
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Don’t base your plans on this, but I personally know of at least 5 people where Medicare Part B + FEHB BC/BS Basic = zero out of pocket costs for anything.
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Jan 26, 2023 21:41
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Yeah if I do 20 years I get some amount of pension and my employer's health insurance for life so between that and Medicare I hope I'm in that boat as well when the time comes
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Jan 26, 2023 23:03
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Does anyone have experience with a Limited Purpose FSA? Seems like it'd be pretty ideal to have in conjunction with a HSA.
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Jan 30, 2023 08:24
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literally this big posted:Does anyone have experience with a Limited Purpose FSA? Seems like it'd be pretty ideal to have in conjunction with a HSA. I do. Make absolutely sure you will spend that money, otherwise you will lose it. My wife was planning to get a dental procedure done and then we got pregnant so she had to postpone it. We had to scramble to find ways to spend the money, in the end using it on expensive prescription sunglasses just so we wouldn’t lose it. Also, they are incentivized to deny your receipts, so it can be a back and forth with the medical provider to get them to provide more detailed receipts until it’s finally approved. What works best is to submit your insurance’s EOB’s as a receipt. We got dependent care FSA to pay for daycare last year and in the end we didn’t use $90 of it so that’s going down the drain. Yes the tax savings still make it a win, but it’s frustrating to watch your money burn. FSA rules are dumb and hostile. Why can’t they just reimburse you that money as taxable income if you didn’t use it? This country will come up with the most stupid bureaucratic games rather than fix healthcare. https://money.com/fsa-contributions-workers-forfeit-money/ In the end it’s the employer who keeps your money if you don’t use it. What a nice grift. Animal fucked around with this message at 13:51 on Jan 30, 2023 |
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Jan 30, 2023 13:44
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Epitope posted:I will maintain perfect health until my 72nd birthday, at which time I will cash out all my accounts, put the money in a duffel, and walk into the ocean
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Jan 30, 2023 14:27
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Animal posted:I do. Make absolutely sure you will spend that money, otherwise you will lose it. My wife was planning to get a dental procedure done and then we got pregnant so she had to postpone it. We had to scramble to find ways to spend the money, in the end using it on expensive prescription sunglasses just so we wouldn’t lose it. Also, they are incentivized to deny your receipts, so it can be a back and forth with the medical provider to get them to provide more detailed receipts until it’s finally approved. What works best is to submit your insurance’s EOB’s as a receipt. It looks like up to $550 can get rolled over at the end of each year, at least in some plans. That's a decent amount to have for dental bills each year.
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Jan 30, 2023 16:38
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literally this big posted:It looks like up to $550 can get rolled over at the end of each year, at least in some plans. That's a decent amount to have for dental bills each year. That's up to your employer to offer, and most don't.
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Jan 30, 2023 16:41
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literally this big posted:It looks like up to $550 can get rolled over at the end of each year, at least in some plans. That's a decent amount to have for dental bills each year. If you change plans next year it can also disappear.
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Jan 30, 2023 16:44
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literally this big posted:Does anyone have experience with a Limited Purpose FSA? Seems like it'd be pretty ideal to have in conjunction with a HSA. We're using one this year. The kids and I are on a standard PPO style plan (technically a PCA plan), and my wife has separate health insurance under a HSA plan. My oldest is going to get braces this year, so I loaded up my FSA to the max and had her put in about 1200 into a limited purpose FSA under her name. All the kids dental and vision expenses, plus my wife's dental and vision expenses will use her LPFSA funds first, then I'll use my FSA funds for the rest. I also have an HRA I can dip into as well. It's possible my oldest doesn't get braces this year, in that case my employer allows rolling over 570... and we'll have to blow some money on fancy prescription sunglasses or something, but that's a risk I took. I generally hit my 1500 deductible each year, so I don't think we'll lose any funds in a worst case scenario. My employer offers a Health Reimbursement Account they fund with a bunch of money as well that rolls over indefinitely and hopefully I don't have to touch that money this year. So we have 4 buckets of healthcare money Wife LPFSA - $1200 All dental and vision expenses come out of this bucket first. Can rollover 570 if necessary Wife HSA - wife's medical expenses My FSA $2850 - Kids and my health expenses. Can rollover 570 if necessary My PCA/HRA account - company funded - additional healthcare funds for myself and the kids if necessary. The LPFSA works out if you know you're going to have a fair amount of vision and dental expenses. We're only using it this year because of braces, we generally haven't bothered before. The orthodontist gives a discount for paying in full up front and the tax savings made it something I couldn't pass up this year. I generally don't load my FSA either and use the HRA funds the company provides us. The HRA funds never expire, but if I change plans or leave the company they disappear.
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Jan 30, 2023 18:07
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skipdogg posted:We're using one this year. I wonder how this post reads to someone from Sweden
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Jan 30, 2023 18:20
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I maxed my FSA last year since my wife's therapist raised her prices and would easily use it all. She stopped going a month later. Still have about half of it remaining that needs to be used in two months or it's gone.
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Jan 30, 2023 18:57
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Animal posted:I wonder how this post reads to someone from Sweden hosed up
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Jan 30, 2023 19:03
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I didn't think it was possible for one spouse to have an HSA and another a general FSA
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Jan 30, 2023 20:36
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Subvisual Haze posted:I didn't think it was possible for one spouse to have an HSA and another a general FSA Well I might be hosed then. I ran it through our benefit department (we both work at the same company) and the dude on the phone said it was cool.
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Jan 30, 2023 21:05
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529's just got cool. Starting next year, you can roll up to $35,000 from your kids 529 into their Roth IRA. 529's used to suck because you kinda screwed yourself if you over-contributed to it, but now it's an option to drat near fund your kids entire retirement on the cheap through one. https://www.forbes.com/sites/chrisc...ss-millionaire/
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Jan 30, 2023 21:20
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skipdogg posted:Well I might be hosed then. I ran it through our benefit department (we both work at the same company) and the dude on the phone said it was cool. https://blog.bernieportal.com/can-i-contribute-to-hsa-if-spouse-has-fsa quote:If your spouse is currently enrolled in a general-purpose FSA plan, then you are not considered eligible for an HSA alongside it. The reasoning behind this is that both the FSA and the HSA will reimburse expenses prior to the deductible being met. Expenses would be covered under both plans, and as such disqualify one another. This is true even if the employee does not qualify as a dependent on their spouse's plan.
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Jan 30, 2023 22:01
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acidx posted:529's just got cool. Starting next year, you can roll up to $35,000 from your kids 529 into their Roth IRA. 529's used to suck because you kinda screwed yourself if you over-contributed to it, but now it's an option to drat near fund your kids entire retirement on the cheap through one. Whoa -- there must be some kind of catch? Big boon on a 529 vs. a UTMA AFAIK (was reading up on these over the holidays -- don't have kids yet but noodling on other places to park cash...)
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Jan 30, 2023 22:08
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acidx posted:529's just got cool. Starting next year, you can roll up to $35,000 from your kids 529 into their Roth IRA. 529's used to suck because you kinda screwed yourself if you over-contributed to it, but now it's an option to drat near fund your kids entire retirement on the cheap through one. My wife and I are pumped for this because we've been trying to figure out what's an appropriate amount to sock away our four-year-old's higher education which we're sure will be blindingly expensive, assuming she actually goes for higher education, but also not wanting to tie up a bunch of money that can never be used. It's a relief to know that worst case we can just pre-fund bab's retirement (tho lol who are we kidding there won't be retirement by the time she's of that age because there will likely not be a functioning society but hey what are you going to do?)
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Jan 30, 2023 22:13
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acidx posted:529's just got cool. Starting next year, you can roll up to $35,000 from your kids 529 into their Roth IRA. 529's used to suck because you kinda screwed yourself if you over-contributed to it, but now it's an option to drat near fund your kids entire retirement on the cheap through one. Some people are talking about opening 529s for themselves as well, and rolling that money into a Roth in 15 years. There’s apparently no income limit for the rollover to Roth, so for those above the Roth income limit it means avoiding the Pro Rata rule for the backdoor Roth IRA approach. The rollover amounts are capped at and contribute towards normal IRA contribution limits, so no double dipping on amounts, and it would take a few years to roll all 35k over.
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Jan 30, 2023 22:52
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Is it possible to roll over $35k each from the 529 to me, my wife, and my kid's Roth?
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Jan 30, 2023 23:03
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Ruggan posted:Some people are talking about opening 529s for themselves as well, and rolling that money into a Roth in 15 years. Ridiculous all the hoops people will jump through to save on taxes. They really need to just get rid of all employer plans, increase the max on personal IRAs to $50k/year or something, and just let employers contribute to directly to them. Do any sane countries do it this way?
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Jan 30, 2023 23:08
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How do you get an IRA for your kid in the first place if they don't have a job? My 18 month old doesn't have a lot of earned income at the moment?
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Jan 30, 2023 23:18
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drk posted:Ridiculous all the hoops people will jump through to save on taxes. They really need to just get rid of all employer plans, increase the max on personal IRAs to $50k/year or something, and just let employers contribute to directly to them. No, we need to restructure the economy. People who can't afford to put away 50k a year in their IRA also deserve to retire someday. No. It's kind of clever though, 90% of the tax code already is ways for people with wealth (i.e. who earn most of their income passively) to avoid paying taxes. Now there's increasingly ways for the people between 99%-90% of the income/wealth to avoid taxes.
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Jan 30, 2023 23:19
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Mons Hubris posted:How do you get an IRA for your kid in the first place if they don't have a job? My 18 month old doesn't have a lot of earned income at the moment? Hire your kid as a model and use their picture on the cover of a book you write, etc.
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Jan 30, 2023 23:30
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Residency Evil posted:Is it possible to roll over $35k each from the 529 to me, my wife, and my kid's Roth? That’s what it sounds like. Need separate accounts because they need to have existed without beneficiary changes for 15 years, and the money must have been in the account for 5 years (which means some recently earned interest will not be retrievable). But yes, I think you could sock away some cash and roll it into your own IRA in 15 years. I’m not a financial advisor though. Also most states let you deduct contributions from income for the purpose of state taxes. So you can benefit from that as well. I think my state allows a deduction of 3500ish per beneficiary? drk posted:Ridiculous all the hoops people will jump through to save on taxes. They really need to just get rid of all employer plans, increase the max on personal IRAs to $50k/year or something, and just let employers contribute to directly to them. Probably not. Mons Hubris posted:How do you get an IRA for your kid in the first place if they don't have a job? My 18 month old doesn't have a lot of earned income at the moment? You don’t, but when the requirements are met you can roll the 529 into an IRA. That means some of the tax advantaged growth can start now rather than needing to wait until they have their first job. You can save now with no need for child income and later convert that money over.
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Jan 30, 2023 23:38
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Mons Hubris posted:How do you get an IRA for your kid in the first place if they don't have a job? My 18 month old doesn't have a lot of earned income at the moment?
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Jan 30, 2023 23:54
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I'll bet that rollover amount limits are still tied to income as well. Like how the IRA contribution limit is $6500 but if you only make $3,000 that year than you can only contribute $3,000. If the kid isn't making income you probably can't do the rollover yet.
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Jan 31, 2023 00:02
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I'm pretty sure an IRA requires earned income and interest doesn't count. It seems like regulations are still to come, but based on what I'm seeing the 529 rollover doesn't seem a particularly useful as a "loophole". It's sounds great if you accidentally have 529 money left over and now have a place to put it, but locking away $10k for 15 years until it grows to $35k, and risk having to pay taxes and penalty on whatever excess, and having it take the place of a backdoor Roth, etc. seems like a lot of hassle for a limited benefit.
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Jan 31, 2023 00:28
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acidx posted:I'll bet that rollover amount limits are still tied to income as well. Like how the IRA contribution limit is $6500 but if you only make $3,000 that year than you can only contribute $3,000. If the kid isn't making income you probably can't do the rollover yet. I think they are, yes. But it’s a way to fund their IRA and allow them to use that money in some other way once they have earned income. Also it lets you start getting the tax benefit on growth now, as opposed to needing to wait. Same with creating an account for yourself - you can stuff extra money in there today if you have the financial means to do so, allowing it to grow tax-free for the next 15 years. When it is old enough, move it over and use the money you would have used to fund your IRA for something else. And once you’ve capped the 35k out, if there is leftover money, change the beneficiary to your kids or grandkids and spend the leftover on education (or start the clock to repeat this strat for the grandkids’ IRA). Plus, layer on the state tax breaks of contributing to your state’s 529. That’s worth something now. The biggest risk of all of this IMO is that there’s no guarantee that our batshit tax law in this batshit country won’t change regarding this strategy over the next 15 years.
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Jan 31, 2023 00:34
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Retirement planning relying on the continued existence of a bunch of weird loopholes is amazing.
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Jan 31, 2023 03:22
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Coming up with some hand-wavy modeling job or something you can pay your child for through a shell company seems easier than dealing with waiting 15 years to do a roll-over.
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Jan 31, 2023 06:19
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Ruggan posted:Some people are talking about opening 529s for themselves as well, and rolling that money into a Roth in 15 years. This seems like a bad idea, premised on the notion that 529s will not change in the next 15 years to make this impossible.
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Jan 31, 2023 06:23
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i might be getting a significant amount of cash over the next few years, depending on life goes. Somewhere between 1-2 mil in the near term, and possibly some more at some unknown point in the future. (parents are in a bitter divorce battle and slowly liquidating assets/company that they share ownership in, mom has late stage cancer. I'm handling mom's money and she intends to slowly transfer over her share with the intention of having me inherit all when she passes) I'm, 31, single and have no children. I quit my job and left the US to take care of family affairs, but I do have a green card and intend to return to get citizenship in the future. I don't think I will go back into a 9 to 5 grind again if I can avoid it. This doesn't mean I won't work at all but I want to take more risks and try different things while I'm still not too old to do so. I had pretty much no life in my 20s  and recent family ordeals taught me that I was playing it a bit too safe.That means I might need to live off my stash for a while, and I'm looking for options on how to go about doing this. While working in a high cost city like Seattle I was able to live an okay life at around 3.5k, with around 2k going to rent, so that's about my overall monthly spending goal. Anything more than that would be a luxury and I would probably just chuck it back in if I don't spend it. I probably won't be living in such a high cost area so my needs might be a bit lower than that ofc. What can I do? I guess I can just throw everything into VTI and sell/withdraw a certain amount each month. Or try a dividend fund and live off of the dividends which sounds a bit safer since the main capital isn't getting smaller in time. Or maybe a mix of both? I was even thinking about putting it all on JEPI since even when markets were surging in the first half of 2021 it yielded 6% which would cover my needs, and it still captures some of the market growth? Maybe TBills since they are pretty much risk free? A bit of all? I've no idea honestly.
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Jan 31, 2023 13:12
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ROJO posted:Coming up with some hand-wavy modeling job or something you can pay your child for through a shell company seems easier than dealing with waiting 15 years to do a roll-over. Yeah these are just middle class optimizing strategies. People with real money are setting up LLCs consisting of themselves in Puerto Rico or whatever.
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Jan 31, 2023 15:08
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The 529 into Roth rollover is just to help people with older kids now that didn't use all the savings, as well as slightly changing the calculus regarding whether to use a 529 at all. I would not advise using this as an investment strategy - the timeline is way too long and the payoff is really small. There's way better methods of savings for your children's retirement.
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Jan 31, 2023 16:20
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Basically just means that overshooting on your kid's 529 isn't that big of a deal now, right?
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Jan 31, 2023 16:26
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Yeah seems like it. If you have the space to min-max this from a retirement perspective for your children you already have the resources to do it better.
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Jan 31, 2023 17:04
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