A Health Savings Account Can Help You Plan for Retirement
For Mark Roberts’ Use: What kind of deductible does your health insurance carry? What would you do if you suffered a severe illness or expensive accident? If you’re like nearly 90 percent of middle-income Americans, you could be forced to sacrifice some of your retirement savings to pay high medical bills. Before making this drastic mistake, you should consider the long term consequences and opt for a better plan of action.
When you borrow from your retirement savings, you don’t just lose that money from the account. You also lose the interest that would have compounded over time, making it nearly impossible (for the majority of people) to ever replace those funds. You would no doubt feel the burden of this decision once you retire.
Rather than finding yourself forced into a tragic decision, it’s better to plan ahead for high medical bills. If you’re eligible to contribute to a Health Savings Account (HSA), you can contribute pre-tax dollars to a fund to pay for future medical bills. If you don’t use all of the cash in the account during one year, it accumulates until you need it. And when you do take a distribution from the account, you won’t have to pay income taxes on the money.
An HSA can protect your retirement in two ways. First, it could prevent you from needing to borrow from your retirement account in the event of high medical bills. But it can also be used to save more money for your retirement. If you don’t use the funds during your working years, the money can also be used to pay Medicare premiums or other qualified medical expenses in retirement. The account could even be accessed to pay for long-term nursing care, and remember that the distributions are not taxed when used for medical expenses.
For more information on budgeting solutions, or to ask any other questions about planning for retirement, give us a call. We’d be happy to help with any of your financial concerns.
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In addition to managing clients’ money and giving investment and diversification advice, Mark offers something that “the other guys” don’t - a unique approach to Retirement Tax Strategies and distribution. Time and time again, Mark meets with new clients who tell him they have a great relationship with their financial advisor but have never been offered information on this kind of approach to securing their financial futures. Mark has taken this feedback to heart and works tirelessly to ensure that his strategies focus on taxes and distribution.
Mark started selling insurance for a major insurance company right out of high school to help put himself through college. After graduating with a degree in finance, he dove into estate planning on the financial side to set himself apart from other financial advisors. However, as changes were made to estate tax laws over time, Mark shifted his focus to income tax strategies.
Mark’s philosophy is “the blue prints are more important than the wall paper or carpet.” The wall paper and carpet represent products like investments and insurance policies, whereas the blue prints represent the strategies. Once strategies that truly fit the client’s needs are put in place, our focus can shift to providing you with the right products. According to Mark, “It doesn’t matter what carpet we use if the walls are not in the right place.”
Our approach to money management is designed to generate the largest alpha (quality) with the lowest standard deviation and beta (risk). By doing this, we help provide clients with the highest return on the lowest risk. Generating income for our retirees is also very important. Because withdrawing money from your portfolio hurts the account rather than helping it, our goal is to design income strategies to harm the portfolio the least making the money last longer.