FSA Or HSA: Which Is Right For You?

+ A GUIDE TO HSAS AND FSAS YOU CAN BUY GLASSES WITH THAT? A personalized, tax-advantaged HSA or FSA can make healthcare easier and stretch your dollars to their full potential HSA + HEALTH SAVINGS ACCOUNT HELP people pay for HEALTHCARE Provide TRIPLE TAX-ADVANTAGES, meaning reduce taxable income with Tax-free withdrawal Tax-free contributions Tax-free earned interest for qualified expenses WHO QUALIFIES FOR AN HSA? Cannot be eligible for Medicare or Medicaid and cannot be claimed as a dependent Must have an HDHP What is an HDHP? High deductible health plan of Plan with a HIGHER HDHPS AND HSAS let you pay for medical expenses WITHOUT GETTING TAXED DEDUCTIBLE but lower monthly premiums How many people use HSAS? 20.2 Million people enrolled in HSAS/HDHPS in 2016 O0000 21% 11% 30% 35% 3% Age 0-17 Age 18-24 Age 25-44 Age 45-64 Age 65+ Workers in HSA-qualified HDHPS 15% 19% 2015 2016 How do 2018 Guidelines HSAS work? MINIMUM OUT OF POCKET CONTRIBUTION DEDUCTIBLE MAXIMUM LIMITS Choose HOW MUCH you want to contribute annually Receive DEBIT CARD or checks connected to HSA Individual Individual Individual funds $1,350 $6,650 $3,450 Use on MEDICAL EXPENSES, T deductibles, copays, and coinsurance Family Family Family Insurance premiums cannot be paid for with an HSA $2,700 $13,300 $6,900 HSAS HAVE A LOT TO OFFER-from investment opportunities to vision care-BUT THERE ARE OTHER OPTIONS out there if you don't qualify Individual in the family: $7,350 Adults over 55 can contribute up to $1,000 more + FSA + FLEXIBLE SPENDING ACCOUNT These benefits of the FSA make it the right option for some No eligibility requirements, including no HDHP Lower deductible helps individuals and families with regular medical needs Contribution limit: Contribution amounts can $2,650 only change at open enrollment or with job status or family status change Drawbacks Use-it-or-lose-it rule: Leftover funds do not roll over to next year TWO EXCEPTIONS TO THE GRACE PERIOD USE-IT-OR-LOSE-IT RULE CARRYOVER Employees given extra 2.5 months for new expenses using the previous year's funds Employees can roll over up to $500 of unused funds into the next year After that, all unused money forfeited Any money over $500 forfeited Not portable with a job change Can't invest Employer-owned but employee funded Contributions tax-free but funds doesn't build interest or withdraw tax-free Types of FSAS FULL PURPOSE FSA LIMITED PURPOSE FSA Cannot enroll in both HSA and Can be used concurrently with an HSA FSA Only used for vision and dental care Used for coverage of medical, dental, prescription, and vision care FSAS and HSAS are great, but everyone has different needs-YOU NEED TO KNOW THE UPSIDES AND DOWNSIDES OF BOTH BEFORE ENROLLING + HSA BENEFITS, + DISADVANTAGES, AND TIPS Possible Drawbacks of the HSA Some HSAS charge a MONTHLY HIGH HEALTHCARE Medical Use on things other than medical HIGH RECORDKEEPING can be a hassle DEDUCTIBLE costs can eat up account or require more MONEY OUT requirement can be EXPENSIVE expenses could incur PENALTIES MAINTENANCE FEE or a OF POCKET FOR SOME PER-TRANSACTION AND TAX FEE After AGE 65, PENALTIES Benefits of the HSA STOP but taxes continue ANYONE CAN TRIPLE TAX-ADVANTAGED CONTRIBUTE TO IT PLAN Employer Family Anyone else Pre-tax/tax deductible Accrues interest tax-free Allows withdrawal tax-free PORTABLE EMPLOYERS CAN DEPOSIT PRE-TAX PLAN INCOME DIRECTLY INTO HSA Follows you when Deposits can be claimed as you change jobs unlike the FSA deductions on taxes LOWER HEALTH TAX-FREE INTEREST AND INSURANCE PREMIUMS INVESTMENT PROFIT IN LINE WITH RETIREMENT ACCOUNTS Insurers reward L Leftover funds roll over annually tax-free for willingness to take risk on HDHP Tips to Get Your Account Rolling FIND ACCOUNT THAT WORKS FOR YOU - EASY to use Pays INTEREST Charges LOW FEES Allows you to invest ACCOUNT CONTRIBUTIONS TALK TO YOUR EMPLOYER ABOUT COMPANY HSAS Opt to pay prorated MONTHLY CONTRIBUTION OR TOTAL UPFRONT Employers can contribute to "NON-HIGHLY COMPENSATED EMPLOYEES" without employer-provided healthcare plan INVESTMENT Can be invested in MUTUAL FUNDS, STOCKS, AND BONDS – MORE BENEFICIAL than an IRA or 401(k) which are subject to FICA tax - Transfer IRA (Individual Retirement Account) funds to HSA through trustees without paying taxes REIMBURSEMENT FOR MEDICAL EXPENSES - PAY MEDICAL BILLS AND REIMBURSE YOURSELF from the HSA account later EXPENSES must be from after the HSA account was established NO TIME LIMIT, even into next enrollment year – KEEP RECORDS accurate and safe to prove transactions in case of IRS audit Have check or FUND TRANSFER sent to HSA holder or withdraw from an ATM Qualified Medical Expenses ADDICTION DENTAL IMPROVEMENTS ΜΕΝTAL VISION CARE MANY OTHERS TREATMENT CARE TO HOME FOR MEDICAL HEALTH ACCOMMODATION Contact Prescription Routine Prescription lenses glasses sunglasses exams Whether you're interested in an HSA or FSA for your medical or vision care-PICK THE PLAN THAT'S RIGHT FOR YOU and if it's an FSA, remember to use it or lose it SOURCES FRAMESDIRECT.COM и т еу е wear zenefits.com/blog/fsa-vs-hsa nerdwallet.com/blog/health/what-is-an-hsa fitsmallbusiness.com/section-125-cafeteria-plan pre DEVELOPED BY N NOWSOURCING healthcare.gov/glossary/high-deductible-health-plan broker.uhc.com/assets/2018-hsa-guidelines-100-8536.pdf nerdwallet. llet.com/blog/heglth/emp -hsa-fsa-whats-difference visin/emplovision-fsa-and-prescription-eyeA.17.pdf lenscrafters.c com/lc-us/vision-g 17/02/2016 ahip.org/wp lcredit-card-news/how-to-get-reimbursed-hsa-health-savings-account.php /uploads/ news/bov2016_HSASurvey_Draft_2. creditcards.com/ kff.org/report-section/ehbs-2016-section-eight-high-deductible-health-plans-with-savings-option investopedia.com/articles/personal-finance/09081 cmich.edu/fas/hr/Documents/General%20Purpose%20vs.%20Limited%20Purpose%20Health%20FSA.pdf money.usnews.com/money/blogs/my-money/articles/2017-04-04/5-ways-to-get-the-most-value-from-your-hsa money.usnews.com/money/personal-finance/articles/2015/11/19/fsa-vs-hsa-ħow-to-make-the-best-choice-during-open-enrollment 4/pros-and-cons-health-savings-account-hsa.asp