Planning AheadDear Planning,It’s true! A health savings account is a fantastic financial tool that can help you build up a tax-free stash of money for medical expenses now and after you retire – but there’s a catch. To get one, you must have a high-deductible health insurance policy.How They WorkHealth savings accounts (or HSAs) have become increasingly popular over the past few years as health care costs continue to skyrocket, and because more and more Americans have gotten high-deductible health plans.The benefit of a HSA is the triple tax advantage that it offers: Your HSA contributions can be deducted pretax from your paycheck, lowering your taxable income; the money in the account grows tax-free; and if you use the money for eligible medical expenses, withdrawals are tax-free.And if you change jobs, the HSA moves with you.To qualify, you must have a health insurance policy with a deductible of at least $1,350 for an individual or $2,700 for a family.This year (2018), you can contribute up to $3,450 if you have single health insurance coverage, or up to $6,900 for family coverage. Next year (2019) you can contribute slightly more – up to $3,500 for single coverage or up to $7,000 for family coverage. And people age 55 and older can put away an extra $1,000 each year. But you cannot make contributions after you sign up for Medicare.The money can be used for out-of-pocket medical expenses, including deductibles, co-payments, Medicare premiums, prescription drugs, vision and dental care and other expenses (see IRS.gov/pub/irs-pdf/p502.pdf, page 5, for a complete list) either now or when you retire for yourself and your spouse as well as your tax dependents.And unlike a flexible spending account, an HSA doesn’t require you to use the money by the end of the year. Rather, HSA funds roll over year to year and continue to grow tax-free in your HSA account for later use. In fact, you’ll get a bigger tax benefit if you use other cash for current medical expenses and keep the HSA money growing for the long term. Be sure to hold on to your receipts for medical expenses after you open your HSA, even if you pay those bills with cash, so you can claim the expenses later. There’s no time limit for withdrawing the money tax-free for eligible medical expenses you incurred anytime after you opened the account.But be aware that if you do use your HSA funds for non-medical expenses, you’ll be required to pay taxes on the withdrawal, plus a 20 percent penalty. The penalty, however, is waived for those 65 and older, but you’ll still pay ordinary income tax on withdraws not used for eligible expenses.How to Open a HSAYou should first check with your employer to see if they offer a HSA, and if they will contribute to it. If not, you can open an HSA through many banks, brokerage firms and other financial institutions, as long as you have a qualified high-deductible health insurance policy.If you plan to keep the money growing for the future, look for an HSA administrator that offers a portfolio of mutual funds for long-term investing and has low fees. HealthEquity, OptumBank, The HSA Authority and Bank of America are the top ranked HSA providers for long-term investing according to the investment research firm Morningstar. To search for providers, visit HSAsearch.com.After setting up your HSA plan, adding money is pretty straightforward. Most plans let you do online transfers from your bank, send checks directly, or set up a payroll deduction if offered by your employer. And to access your HSA funds many plans provide a debit card, some offer a checkbook and most allow for reimbursement.Send your senior questions to: Savvy Senior, P.O. Box 5443, Norman, OK 73070, or visit SavvySenior.org. Jim Miller is a contributor to the NBC Today show and author of “The Savvy Senior” book. Dear Savvy Senior,What can you tell me about health savings accounts? I’ve been reading that they are a great investment that can help with growing health care costs when I retire.
Sign up for our COVID-19 newsletter to stay up-to-date on the latest coronavirus news throughout New York America is about to go through an important once-in-a-decade process: the U.S. Census. Counting everyone in America is a lot of work, but so much is at stake — especially for Nassau County. Billions in funding is decided by the Census. Ten years ago, we were undercounted and as a result, Long Island didn’t get our fair share of funding for a decade. Nearly one in four Nassau residents didn’t fill out the 2010 Census when it was first sent to them, according to estimates. Nassau is ranked the fifth most difficult-to-count county in New York State.We already send more money to Washington, D.C. than we get back, so we cannot afford another undercount. That’s why I brought together more than 30 nonprofit, labor, faith, and community leaders to form a Complete Count Committee with a single goal: ensuring every person in Nassau is counted in next year’s Census.We are engaging our immigrant and hard-to-count communities early to educate residents about why it’s important to be counted, and to reassure them that it’s totally safe.The federal government distributes $53 billion to New York State based on Census data. That’s money for roads, bridges, public schools, law enforcement, housing programs — the list goes on. So when you fill out a Census form, what you’re doing is making sure your community gets the services it needs. Census data are used to determine political representation on the federal and local levels, including each state’s electoral votes. And businesses look at Census data when they decide where to set up shop or relocate. Real dollars and important decisions are based on that data.Being counted should be easier than ever for many residents next year. By April 1, 2020, every home will receive an invitation to participate in the Census. Once the invitation arrives, you can respond for your home online, by phone, or by mail.Don’t throw away that envelope from the U.S. Census Bureau. Ninety-five percent of households get their Census “invitation” in the mail.Tell your friends, family, and neighbors to make sure they know they should be counted. And if you have children, being counted in the Census is one of the best things you can do to secure a better future for your child and community. So let’s make sure Nassau counts.Laura Curran is the Nassau County Executive