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Long-Term Care and Retirement Planning

HSA - Health Savings Account, News, Retirement Planning, Uncategorized

November marks Long‑Term Care Awareness Month, a time dedicated to raising public understanding about the challenges and planning needs associated with long-term care (LTC).

For individuals preparing for, or already living in, retirement, this month offers an ideal moment to examine how LTC interlocks with a broader retirement strategy.

With life expectancies increasing, the shifting cost structures of healthcare and care services, and the evolving role of retirement savings, it’s more important than ever to integrate long-term care considerations into your retirement roadmap.

What is Long-Term Care and Why It’s a Retirement Planning Must

Long-term care refers to services and supports needed when an individual can no longer independently perform everyday tasks such as bathing, dressing, eating, moving about, or managing medications (often called Activities of Daily Living, or ADLs) or when cognitive impairment requires supervision.

Importantly:

LTC isn’t just for a few weeks after a hospital stay; it can involve years of support in home-based settings, assisted living, or nursing facilities.
It is not primarily covered by Medicare. Many believe Medicare will cover all their care if needed, but that is incorrect.
Because of its high cost and the unpredictability of timing and duration, LTC represents one of the most significant retirement planning risks, one that is often overlooked.

For retirees and pre-retirees, the key takeaway: Ignoring long-term care is akin to ignoring a large, uncertain expense that can derail even a well-funded retirement plan. Recognizing LTC as a “what-if” scenario (but with high consequences) helps you build resilience.

The Scope of the Challenge: Statistics That Demand Attention

Let’s look at some of the most relevant data shaping the long-term care and retirement planning landscape.

Need & Duration

A person turning age 65 today has nearly a 70% chance of needing some form of long-term services and supports (LTSS) during the remainder of their life.
One-third of 65-year-olds may never need LTC, but about 20% will need it for more than five years.
Women face higher odds and longer durations: for example, it’s estimated that women 65+ have a 51% lifetime risk of needing paid LTC, compared to 39% for men.

Impact on Retirement Finances

Because LTC is largely excluded from standard retirement cost estimates, it is often a “blind spot” in planning. Some financial experts even say that failing to plan for LTC expenses “can be more detrimental to your portfolio than any market downturn.“
From a funding perspective, you can roughly estimate three years of services: one source notes average durations of around 3 years and sometimes more than five.

What this tells us: LTC is common, expensive, often unplanned for, and deeply intertwined with retirement security. It is exactly the kind of risk your retirement plan should account for.

How Long-Term Care Fits into Retirement Planning

At Agemy Financial Strategies, we view a retirement plan as having multiple layers: income sustainability, longevity management, legacy goals, lifestyle fulfillment, and risk mitigation. Long-term care intersects several of these layers.

Income & Expense Forecasting

A core retirement planning step is estimating your annual expenses and sources of income. But many expense forecasts assume “healthy aging” and only baseline healthcare costs; they often omit a significant LTC event.

In reality, incorporating LTC means adding a “what-if” scenario: What if I need care for X years at cost Y? Incorporating possible long‐term care costs into an income plan can help investors understand whether they’re prepared to deal with these costs.

By acknowledging LTC, you strengthen your income plan’s resilience.

Longevity & Health Span

Increasing life spans mean more retirees will live into their 80s or 90s. With that comes increased risk of needing care. A strong retirement plan needs to flex for longer lifetimes, and the longer you live, the higher the chance LTC will be part of your financial story.

Asset Preservation & Legacy

If a retiree underestimates LTC costs, they may draw down retirement savings prematurely or face the prospect of asset erosion. That can compromise legacy ambitions. Planning ahead – and funding an LTC “reserve” or coverage – can help preserve whether you’re aiming to leave an inheritance, support children, or donate to causes.

Lifestyle & Choice of Care Setting

When you plan proactively, you gain more flexibility in the choice of care (in-home, assisted living, nursing home, etc.). Waiting until a crisis reduces your options and often increases cost. The ability to choose how and where you receive care is part of maintaining quality of life in retirement.

Risk Management: Self-Insurance vs. Transfer

Approaches to LTC mirror broader retirement risk strategies: do you self-insure (accept the risk, fund it yourself) or transfer the risk (via insurance, hybrid products, other vehicles)?A coordinated retirement plan explicitly addresses this decision.

Key Strategies to Help You Prepare for Long-Term Care in Retirement

1. Early Awareness & Estimation

Begin by estimating your likely LTC need: chances, duration, and approximate cost. For example: 70% chance of needing some care, about 3 years average, but with 20% needing five years or more.
Research the cost of care in your region (home care, assisted living, nursing homes).
Factor inflation in care costs (care cost inflation often exceeds general inflation).
Include a “stress-test” scenario: longer duration, higher cost, earlier onset.

2. Integrating LTC into Your Retirement Income Plan

Treat LTC like other major risks (market volatility, longevity, health deterioration).
Model your cash flows: Suppose you begin retirement at 65, expect 25–30 years of spending, then include a possible LTC expense at age 80 for 3–5 years at cost X. See if your portfolio and income sources hold.
Use tools such as Health Savings Accounts (HSAs), Roth conversions, and strategic withdrawals to help preserve flexibility. For example, HSAs can be used tax-efficiently for qualified LTC expenses.
Coordinate with Social Security, pensions, and other guaranteed income sources to free up assets that can serve as LTC reserves.

3. Insurance and Risk Transfer Options

Traditional long-term care insurance: Standalone LTC policies that pay a daily or monthly benefit when you meet policy trigger(s). Need to purchase earlier (often 50s–60s) to lock in better health and lower premiums.
Hybrid life insurance with LTC rider: Combines life insurance and LTC coverage; if care isn’t needed, heirs receive the death benefit. This transfers risk while offering a potential legacy benefit.
Self-insuring (funding yourself): For those with substantial assets, you may decide not to purchase insurance and instead keep sufficient reserves/investment flexibility to cover LTC if needed. But this route demands discipline and careful asset-liability matching.

4. Tax & Funding Considerations

HSAs: Contributions are tax-deductible, growth is tax-free, and withdrawals for qualified medical/LTC expenses are tax-free. Use of HSAs for LTC gives significant tax advantages if you plan ahead.
Roth conversions: Converting traditional IRAs/401(k)s to Roth can help reduce taxable distributions during periods of care, offering more net flexibility.
Deductibility of LTC insurance premiums: Under IRS rules, some LTC insurance premiums are deductible (subject to age-based limits) if they meet certain definitions.
Estate planning & trust design: LTC planning often intersects with Medicaid eligibility, asset protection, and legacy transfer.

5. Lifestyle & Preventive Measures

While we cannot eliminate the risk of needing care, research suggests many aging-related issues are influenced by modifiable factors (exercise, diet, sleep, social connections).
Planning for “aging in place” (home modifications, accessibility features, local support services) can help reduce the severity and cost of care required.
Early conversations with family about care preferences, trusted decision-makers (durable power of attorney, healthcare proxy), and options help ensure choices align with values and reduce emotional/financial stress later.

Specific Long-Term Care Costs in Connecticut

The state of Connecticut represents one of the higher-cost markets for long-term care in the U.S., and that has important implications for retirement planning. Here are key figures and what they mean for retirement strategies.

Key Cost Figures:

In Connecticut, the average cost of 3 years of LTC was $549,099 (which works out to around $181,033 per year) for full nursing-home level private-room care.
For assisted living in Connecticut, the average cost is about $66,207 per year.

What this Means for Retirement Planning:

Because nursing-home level care in Connecticut can easily exceed $15,000 per month, retirees must recognize that even a moderate duration (say 2-3 years) of such care could consume $360K–$540K or more, depending on exact duration and type of room.
Assisted living, while less costly than full nursing home care, still runs at several thousand dollars per month, making it a significant draw on retirement savings if not planned.
Geographic variation matters: costs in the Bridgeport-Stamford area tend to be higher than in more rural or less-expensive regions of the state.
For a retirement plan to be resilient in Connecticut, it’s prudent to run a scenario that assumes a cost of around $200,000/year if full nursing care is required, then evaluate how that interacts with your income, portfolio, guaranteed income sources, and legacy goals.

Specific Long-Term Care Costs in Colorado

For our clients in or considering retirement in Colorado, the cost profile is more moderate than in Connecticut, but still very material. Let’s look at the latest data and implications.

Key Cost Figures:

Assisted living in Colorado averages about $5,392 per month across the state, with a range of roughly $4,600 to $5,433 depending on the region.
The cost of nursing home care in Colorado has been reported at around $9,944 per month.

What this Means for Retirement Planning:

While the cost in Colorado is lower compared to the high-end states like Connecticut, even $5,000-plus/month for assisted living or $10,000/month+ for nursing home care adds up rapidly. For example, $10,000/month is $120,000/year, over just a few years, that becomes $300K+.
For a 3-5 year care event, a retiree in Colorado might anticipate $300K–$600K of potential expense, depending on type, timing, and location.
Geographic variation again matters: costs are higher in metro areas like Denver or Boulder; a retiree in a more rural part of Colorado may pay less.
Because of the moderate cost environment, clients may consider a blend of self-insurance and risk transfer: perhaps setting aside a dedicated LTC reserve funded via portfolio or tax-advantaged accounts, combined with targeted insurance for “worst-case” duration.

How Agemy Financial Strategies Can Help You This Month

At Agemy Financial Strategies, we believe that Long-Term Care Awareness Month is more than a calendar marker; it’s a call to action. Here are ways we support our clients:

Retirement readiness assessments: We include an LTC “what-if” scenario as part of your retirement simulation, estimating impact, drawing insights, and recommending adjustments.
Customized funding plans: Based on your asset base, risk tolerance, health profile, and legacy goals, we help evaluate self-insurance vs. transfer strategies to suit your situation.
Tax-efficient strategies: We help you explore HSAs, Roth planning, and other tax-efficient vehicles in the context of LTC and retirement income.
Ongoing education & review: Care costs, policy landscapes, and personal health evolve. We schedule periodic reviews to update your LTC assumptions and adjust your plan accordingly.

Your next steps this month:

Schedule a meeting with us to run your LTC-inclusive retirement scenario.
Identify your preliminary estimate of care need: age, duration, setting (home/assisted/nursing).
Collect local cost information for your region (we can provide benchmarking).
Discuss with your family your preferences and identify decision-makers.
Review current coverage (if any) and determine whether you need to explore LTC insurance or hybrid options.
Ensure your HSAs, IRAs/401(k)s, and estate plan are aligned so that LTC exposure won’t undermine your income, assets, or legacy.

Final Thoughts

Long-Term Care Awareness Month is a valuable prompt, but the real work happens when you translate awareness into action. For retirees and pre-retirees, recognizing the significant likelihood of needing long-term care, understanding the cost implications, and integrating those considerations into your retirement blueprint can be indispensable when it comes to your financial future.

By viewing LTC not as a remote worry but as a manageable element of your retirement strategy, you can reinforce your financial confidence, protect your lifestyle, and preserve your legacy. At Agemy Financial Strategies, we’re here to guide you through the complexities, tailor a plan that fits your unique needs, and help you move forward with clarity and purpose.

Let’s use this November to make long-term care planning an integral part of your retirement preparation, not just a footnote.

Contact us today to schedule your LTC-inclusive retirement review and discover how we can help you reduce the uncertainty, protect your income, and secure your future.

Investment advisory services are offered through Agemy Wealth Advisors, LLC, a Registered Investment Advisor and fiduciary to its clients. Agemy Financial Strategies, Inc. is a franchisee of Retirement Income Source®, LLC. Agemy Financial Strategies, Inc. and Agemy Wealth Advisors, LLC are associated entities. Agemy Financial Strategies, Inc. and Agemy Wealth Advisors, LLC entities are not associated with Retirement Income Source®, LLC

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November 7, 2025/by Agemy Financial Strategies

The Financial Impact of Caregiving: How to Protect Your Future

HSA - Health Savings Account, News, Retirement Income Planning

Caregiving is a selfless act of love and devotion, yet it can also present significant financial challenges. From out-of-pocket expenses to lost wages and retirement savings, caregiving can profoundly impact long-term financial security. Nearly half (43%) of individuals are afraid that caregiving expenses will keep them from ever retiring.

More individuals find themselves in the role of caregiver—whether for aging parents, a spouse, or other loved ones. While caregiving is rewarding, it is crucial to plan ahead to minimize financial strain and help ensure your future remains secure. In this blog, we’ll explore the financial implications of caregiving, strategies to help manage costs, and steps to protect your financial well-being.

The Financial Burden of Caregiving

Caregiving is not just a time and emotional commitment—it also carries significant financial implications. The costs can quickly increase whether you provide part-time assistance or full-time care. From medical expenses to lost income, caregivers often face unexpected financial challenges that can disrupt their financial stability. The financial impact of caregiving can vary based on the level of care required, but it often includes:

Out-of-Pocket Costs

Caregivers often take on a significant financial burden, covering expenses such as medical supplies, home modifications, transportation, and groceries. According to a recent study, caregivers spend an average of over $7,200 per year on out-of-pocket caregiving costs—amounting to 26% of their annual income. These ongoing expenses can quickly add up, making it essential for caregivers to plan ahead and explore financial resources that can help alleviate the strain.

Lost Income and Career Disruptions

Caregiving responsibilities often require individuals to adjust their work schedules, reduce hours, or leave the workforce entirely, leading to significant financial consequences. These career interruptions can negatively affect income, retirement savings, and financial security.

Increased Healthcare Costs

Many caregivers neglect their health due to time constraints and stress. According to the Family Caregiver Alliance, caregivers report higher levels of depression and anxiety than non-caregivers, with some experiencing caregiver burnout, a state of physical, emotional, and mental exhaustion. This not only affects their well-being but also leads to greater reliance on healthcare services, prescription medications, and mental health treatment—adding to their financial burden.

Without proper planning, these rising medical expenses can strain caregivers’ budgets, making it essential to incorporate self-care, stress management, and financial preparation into their caregiving strategy. Prioritizing your own health enables you to provide better care for your loved one while helping protect your long-term financial and physical well-being.

Impact on Retirement Savings

Dipping into savings or reducing retirement contributions can have long-term financial consequences. Without careful planning, caregivers may face significant gaps in their retirement funds. Here are some ways you can help protect your retirement while caregiving:

Prioritize Retirement Contributions – Even if you must reduce your contributions, try contributing at least enough to take advantage of employer-matching contributions in a 401(k) or similar plan.
Consider Spousal IRA Contributions – If caregiving leads to job loss or reduced income, a spousal IRA can allow a working spouse to continue making contributions on behalf of the caregiver, helping ensure continued retirement savings.
Explore Catch-Up Contributions – If you’re 50 or older, catch-up contributions allow you to contribute extra funds to retirement accounts, helping bridge the gap caused by reduced savings during caregiving years.

How to Prepare Financially for Caregiving

Taking proactive steps can help ensure you provide quality care without compromising your financial well-being. Below are key strategies to help you manage the financial responsibilities of caregiving while protecting your financial future.

Create a Caregiving Plan

Establish a clear plan that outlines caregiving expenses, potential income changes, and available resources. Consider:

Medical and prescription costs.
Home modifications and assistive devices.
Transportation and caregiving services.
Legal and financial planning fees.

Explore Employer Benefits

Some employers offer caregiving benefits, such as flexible work arrangements, paid family leave, or Employee Assistance Programs (EAPs). Check with your HR department to understand what support is available.

Consider Long-Term Care Insurance

Long-term care insurance can help offset the costs of in-home care, assisted living, or nursing home care. Purchasing a policy earlier in life can lower premiums and help provide financial security if caregiving responsibilities arise.

Plan for Your Own Future Care Needs

Preparing for your own future is essential, just as you plan for a loved one’s care. Consider setting up a Health Savings Account (HSA) or dedicated retirement funds for potential long-term care needs.

Protecting Your Financial Future

Caregiving is a profound responsibility that requires emotional, physical, and financial preparation. While the financial burden can be significant, planning ahead can help protect your financial future while providing quality care for your loved ones. A well-structured financial plan can alleviate stress and help offer long-term security for caregivers and their families.

At Agemy Financial Strategies, we understand the unique financial challenges caregivers face. Our award-winning team is here to help you navigate these complexities and develop a plan that helps protect your financial well-being while supporting your caregiving journey. Here’s how we can help:

Establish Legal and Financial Safeguards

Caregiving often involves managing financial and legal decisions on behalf of a loved one. Our fiduciary advisors can help caregivers put important legal documents in place, such as:

Durable Power of Attorney for financial and healthcare decisions.
Living Will and Advance Directives.
Trusts to manage assets and protect financial interests.

Seek Financial Planning Assistance

Many caregivers find themselves financially stretched due to unexpected costs, career disruptions, and the need to support both their loved ones and their own future. Here’s how our team can help:

Personalized Financial Plan: We help structure a financial plan that accounts for caregiving costs, income adjustments, and savings goals.
Investment Strategies: Our team guides you in balancing liquidity with growth, helping you access funds when needed while continuing to build wealth.
Retirement Planning: We work with caregivers to develop strategies that help keep their retirement goals on track, even if they need to reduce contributions or change their income structure temporarily.

Have Open Conversations About Caregiving Expectations

Many caregivers focus so much on their loved one’s well-being that they neglect to plan for their own future care needs. Failing to prepare for potential long-term care expenses can lead to financial strain. Here’s how we can help:

Creating a future care plan for potential healthcare costs, long-term care options, and financial safety nets.
Facilitating family discussions around caregiving expectations, helping to create a structured plan that distributes responsibilities fairly among family members.
Building emergency savings and contingency plans to cover unexpected expenses, helping ensure that caregivers maintain financial independence.

Planning for the Future with Agemy Financial Strategies

At Agemy Financial Strategies, we understand the financial challenges caregivers face. Our team is committed to providing personalized, fiduciary-based financial planning that empowers you to navigate caregiving responsibilities while helping secure your financial future. If you’re balancing caregiving with financial concerns, let’s create a strategy that supports both your present needs and long-term goals.

Frequently Asked Questions (FAQ)

How can I financially prepare to become a caregiver?

Start by creating a detailed caregiving budget, exploring employer benefits, and considering long-term care insurance. Utilizing potential tax breaks can also help offset caregiving costs. Working alongside a trusted advisor can help you explore your available options.

Are there tax benefits available for caregivers?

Caregivers may qualify for potential deductions through the IRS. Deductions may include the Dependent Care Credit, Medical Expense Deduction, and the Child and Dependent Care Tax Credit. It’s important to consult with a trusted advisor to determine your eligibility.

Should I quit my job to provide full-time care?

Before making this decision, consider the long-term impact on your income, benefits, and retirement savings. Explore flexible work options and financial assistance programs to help balance caregiving and employment.

How can a fiduciary advisor help caregivers?

A fiduciary advisor can help create a comprehensive financial plan that accounts for caregiving costs while maintaining long-term financial security. They can also provide investment strategies and tax-efficient solutions tailored to individual needs.

Disclaimer: This content is for informational purposes only and should not be considered financial or investment advice. The strategies discussed may not be suitable for all individuals. Consult the qualified fiduciary advisors at Agemy Financial Strategies for personalized guidance tailored to your situation.

February 7, 2025/by Agemy Financial Strategies

Ask an Advisor: Is an HSA Right for Me?

HSA - Health Savings Account, News

Health Savings Accounts (HSAs) have become increasingly popular as a flexible and tax-efficient way to manage healthcare expenses and build savings for the future.

With nearly 38 million HSAs in the United States as of 2024—a figure projected to exceed 43 million by 2027—it’s clear that more people are recognizing the value of this versatile financial tool. But is an HSA the right choice for you?

To help you decide, let’s explore the essentials of HSAs, their advantages and limitations, and the critical factors to weigh when considering how they might fit into your overall financial strategy.

Is an HSA Right for You?

Health Savings Accounts (HSA) offer a range of benefits, but they’re not a one-size-fits-all solution. Whether an HSA aligns with your needs depends on several factors, including your current financial situation, healthcare requirements, and long-term goals. Before opening an HSA, evaluating how it fits into your overall financial and retirement strategy is important.

HSAs are particularly advantageous for those who prioritize saving for future medical expenses, enjoy the tax benefits of contributing, and can manage the higher deductibles of a qualifying health plan. However, if you frequently incur medical costs or have limited savings, the out-of-pocket expenses associated with a high-deductible health plan may outweigh the benefits of an HSA.

By assessing your healthcare usage, income stability, and savings priorities, you can determine whether an HSA is the right choice for you. Let’s explore the key considerations to help guide your decision.

What is a Health Savings Account (HSA)?

A Health Savings Account is a tax-advantaged savings account designed to help individuals with high-deductible health plans (HDHPs) cover qualified medical expenses. Here’s an overview of what makes HSAs a valuable tool for healthcare and financial planning:

Eligibility: To open and contribute to an HSA, you must be enrolled in an HDHP, a health insurance plan with higher deductibles but lower monthly premiums.
Flexibility: Unlike Flexible Spending Accounts (FSAs), HSAs allow unused funds to roll over from year to year, making them an excellent option for long-term savings.
Ownership: You own the account, not your employer. This means you can take it with you if you change jobs or retire, helping ensure your savings remain accessible.
Contribution Limits for 2025: The IRS has set the annual contribution limits at $4,300 for individuals with self-only coverage and $8,550 for family coverage. Additionally, individuals aged 55 and older can make a $1,000 catch-up contribution.

HSAs combine immediate tax savings with the flexibility to save for future medical costs, making them a unique and potentially powerful tool in your financial strategy.

Benefits of an HSA

HSAs offer a unique blend of healthcare and financial advantages, making them beneficial for individuals who are looking to optimize their health coverage and long-term savings. Beyond their well-known tax benefits, HSAs provide opportunities for strategic financial planning and future security.

Triple Tax Advantage

HSAs provide a triple tax benefit differentiating them from other savings accounts. This feature allows account holders to save for medical expenses while helping maximize tax efficiency. Here’s how the three tax benefits work:

Tax-deductible Contributions: Contributions help reduce your taxable income, lowering your overall tax liability.
Tax-free Growth: Funds in your HSA grow tax-free, whether held in a savings account or invested in the market.
Tax-free Withdrawals: When used for qualified medical expenses, withdrawals are tax-free, providing potential significant savings.

Additionally, many HSAs offer investment options, helping account holders grow their savings over time and build a tax-advantaged cushion for future healthcare needs.

Long-term Savings Potential

Because HSA funds roll over indefinitely, they can be a supplemental savings tool for future healthcare expenses, including those incurred during retirement. HSAs can act as supplementary retirement accounts. While they are designed for medical expenses, their flexibility after age 65 allows non-medical withdrawals (taxed as ordinary income). This can help provide retirees with another source of funds, complementing IRAs or 401(k)s.

Flexibility in Usage

HSAs can help cover many medical expenses, from doctor visits and prescription medications to dental and vision care. After age 65, withdrawals for non-medical expenses are taxed like ordinary income, similar to a traditional IRA. HSA funds can be used for qualified medical expenses for your spouse and dependents, even if not covered by your high-deductible health plan. This flexibility makes HSAs valuable for families managing healthcare needs.

Generational Wealth Transfer

While HSAs are primarily for healthcare, they also allow for tax-efficient wealth transfer. If the account holder passes away, the funds can be transferred to a spouse’s HSA without tax consequences, helping ensure the account’s value remains intact for the family.

By combining flexibility, tax advantages, and long-term growth potential, HSAs are more than just a healthcare account—they’re a versatile tool that can help bridge the gap between immediate healthcare needs and future financial security.

Potential Drawbacks of an HSA

While HSAs offer many advantages, they aren’t the right fit for everyone. Understanding their limitations is essential to deciding whether an HSA aligns with your financial and healthcare needs.

Eligibility Limitations

To open and contribute to an HSA, you must be enrolled in a high-deductible health plan (HDHP). These plans often come with higher deductibles that may not suit individuals or families with frequent or significant medical expenses.

Higher Out-of-Pocket Costs

Although HDHPs typically offer lower monthly premiums, their higher deductibles mean you’ll need to cover more out-of-pocket costs before insurance kicks in. This can be a financial strain, particularly if unexpected medical expenses arise.

Investment Volatility

Many HSAs provide investment options that can grow your funds over time. However, like any investment, these options are subject to market fluctuations. There’s no guarantee of returns, and you could potentially lose money depending on market conditions and investment choices.

Strict Withdrawal Rules

HSA funds for non-qualified expenses before age 65 are subject to income tax and a 20% penalty. Adhering to these withdrawal rules is essential to avoid unexpected costs and penalties that could diminish the account’s overall value. Carefully evaluating these potential drawbacks alongside a trusted fiduciary advisor can help you determine whether the benefits of an HSA outweigh its limitations for your situation.

Make the Most of Your HSA With Agemy

A Health Savings Account (HSA) can be a powerful tool for helping you achieve your financial and healthcare goals, but navigating the rules and strategies for maximizing its benefits can be complex. At Agemy Financial Strategies, we aim to give you confidence in your financial future by crafting robust portfolios focused on income and growth.

Our fiduciary advisors can help you integrate your HSA into a personalized financial plan, helping ensure it works seamlessly with your long-term goals. Here’s how we can help:

1. Maximize Contributions with Proper Guidance

Reaching the annual HSA contribution limit is a key step toward helping you maximize tax savings and growing your account. Our advisors can help review your financial situation and recommend a plan to take full advantage of these limits while balancing other savings priorities.

2. Optimize Your Investment Strategy

Many HSAs offer investment options that can help grow your balance over time. However, it can be challenging to understand which investments align with your risk tolerance and financial objectives. Our team can help you develop a tailored investment strategy that balances growth and stability to maximize your HSA’s potential.

3. Incorporate HSAs into Retirement Planning

An HSA isn’t just a short-term savings account—it’s a vital part of a well-rounded retirement strategy. After age 65, your HSA can act as a secondary retirement account, allowing non-medical withdrawals taxed as ordinary income. Our fiduciaries can help you integrate your HSA into a larger retirement plan, helping ensure you’re prepared for rising healthcare costs and other expenses.

4. Leverage Tax Efficiency with Strategic Planning

HSAs offer unique tax advantages, but their full potential is unlocked through careful planning. Our advisors help you optimize contributions, withdrawals, and investments to reduce potential tax burdens and enhance long-term savings.

Final Thoughts

At Agemy Financial Strategies, we understand financial planning is about more than numbers—it’s about creating a secure future tailored to your unique needs. Whether starting with an HSA or looking to incorporate it into a larger financial strategy, we’re here to help you make the most of this powerful tool.

FAQs About HSAs

1. Can I open an HSA if I’m self-employed?

Yes, self-employed individuals can open a Health Savings Account (HSA). The eligibility requirements are as follows:

You must be covered by a high-deductible health plan (HDHP).
Other disqualifying plans, like Medicare, Medicaid, or TRICARE, can’t cover you.
You can’t be claimed as a tax dependent.

2. What happens to my HSA if I change jobs?

Your HSA is portable, meaning you can take it with you when you change jobs. You can continue to use the funds for qualified medical expenses even if you are no longer enrolled in an HDHP.

3. Can I have an HSA and an FSA simultaneously?

HSAs and FSAs are similar in that they help you make qualified health purchases using tax-free funds. But with limited exceptions, you can’t have both. If you want to take advantage of your employer’s flexible spending account, you may be unable to contribute to your HSA.

4. What happens to my HSA if I don’t use all the funds?

Any unused funds in your HSA roll over to the next year, allowing you to continue growing your savings tax-free. There’s no “use it or lose it” rule, making HSAs an excellent tool for long-term savings.

5. Can I use HSA funds for my dependents?

You can use Health Savings Account (HSA) funds to pay for qualified medical expenses for dependents. This includes your spouse, children, and other dependents you claim on your tax return. You can also use HSA funds for dependents claimed by their other parent.

Disclaimer: This blog is for informational purposes only and does not constitute financial, tax, or investment advice. Consult the qualified fiduciary advisors at Agemy Financial Strategies for personalized guidance tailored to your situation.

January 27, 2025/by Agemy Financial Strategies

Long-Term Care and Retirement Planning