On Mon, 23 Apr 2007 10:28:17 -0500, JohnS <jst[at]pop.ifi.no> wrote:
- quote -

Seems like a good way to go is to just save some aftertax money and
invest them sensibly. I am in a similar position, with some extra
savings also. At this point my mind tells me that it is time to work
less and enjoy life more, but the actual change is very difficult to
make.

i

jIM <noreplysoccer[at]hotmail.com> wrote:

- quote -

what if you are denied coverage on your own personal
HDHP and cant get one?

"jIM" <noreplysoccer[at]hotmail.com> wrote in message
news:1177419706.856117.187860[at]s33g2000prh.googlegroups.com...
- quote -

The other key part of the requirement is that the HDHP be your _only_
(medical) plan. You can't have a non-HDHP employer plan and HDHP individual
plan and expect to qualify for an HSA. I think you could opt out of your
employer plan and pay for your own HDHP, but I can't see that as being
cost-effective.
http://www.ustreas.gov/offices/publi...gibility.shtml

Mark Freeland
BnetOnewsX[at]sbcglobal.net

On Apr 23, 4:49 pm, "JohnS" <j...[at]pop.ifi.no> wrote:
- quote -

YES. To have an HSA you must have a high deducable health plan
(HDHP). Definitions have changed slightly over the years, look at a
site like this for reference, or check this group's posts for HSA's.

http://www.opm.gov/hsa/

On Apr 23, 10:28 am, "JohnS" <j...[at]pop.ifi.no> wrote:
- quote -

A taxable investment account is a good idea because you may want to
convert your 401k to a Roth which will require some funds to pay extra
taxes.

--
Ron

- quote -

HRA- Health care reimbursement account. Unused portion rolls over to
next year. Typically operated by employer (and in my case the only
one which can contribute to this is my employer). Does NOT pay
interest (so money in account loses purchasing power).

HSA- Healthcare spending account. Unused portion rolls over to next
year. Typically opened by individual similar to an IRA (and
individual is contributing pre-tax dollars). Limited number of HSA
providers, high fees, and transactions costs need review. Some HSA's
operate like "cash accounts", some allow more sophisticated investment
plans (stocks, bonds other).

FSA- Flexible spending account. Provided by employer to individual
similar to a 401k. Money is contributed to plan pre-tax by
individual, and withdraw tax free for health care expenses. Money is
put in current year, and must be taken out by April tax deadline of
subsequent year (for health care expenses incurred the prior year).
Leftover money is LOST at end of year loses not only purchasing power,
but the principal is gone too.

On Apr 25, 10:48 am, "JohnS" <j...[at]pop.ifi.no> wrote:
- quote -

Pretty simple. Any money you don't use, you keep for future medical.
If you don't have enough in your HSA for medical expenses, keep the
receipts and reimburse against your HSA anytime in the future. (Crazy,
this lack of time limit, I'd expect Congress to shut down sooner or
later.) Money used for medical is tax free going in, tax free going
out. Once you turn 65.5, you can treat it like an IRA for non-medical
-- pay tax on it and use for anything. (But obviously, use for medical
first if you have expenses.) Qualified medical expenses include
insurance premiums in some cases (between jobs, retired, long-term
care premiums, etc).

In short, it's an IRA on steroids. Off the top of my head, no other
account will give you tax free on both ends with or without with
conditions (example, 529 requires taxed contributions and then is
taxfree for college). Without employer contributions, you can consider
the government giving you a contribution equal to your federal+state
tax bracket. And if your employer does contribute money, it's the best
thing since sliced bread.

Justin wrote:
- quote -

am a bit perplexed myself as I currently have an HMO plan with employer but
have to drop my flexible spending account (FSA) starting 2008, enrollment
Nov 2007

the HMO deductibles go up and I must enroll in a health savings account
which works like some sort of line-of-credit

does anyone have currently a HSA plan and how does it work? how does HSA
compare to FSA other than the fact that you don't lose the money you don't
use (with FSA one must use the money during the current year)

HW "Skip" Weldon wrote on [Wed, 25 Apr 2007 04:24:06 -0500]:
- quote -

Wouldn't surprise me, of course an FSA is a use it or lose it
proposition, whereas an HSA keeps growing and you never lose the money.

On Tue, 24 Apr 2007 20:05:09 -0500, Justin <nospam[at]insightbb.comwrote:

- quote -

HRA, HSA, FSA... we need a scorecard to keep up. I suspect Amy is
talking about a flexible spending account (I call that "FSA") where
participants contribute pre-tax and use money for qualified medical
expenses during year.


-HW "Skip" Weldon
Columbia, SC

amy wrote on [Tue, 24 Apr 2007 07:21:45 -0500]:
- quote -

You are only allowed to use an HSA if you hve a High Deductible health
care plan.

Mark Bole wrote:
- quote -

I'm pretty sure one can have both a health savings account and an employer subsidized
health insurance plan as I am participating in both at the moment. the difference is
that any deductibles and medical items not covered (ie. dental procedures) are paid
from my HSA where I pay with before-tax money

JohnS wrote:
- quote -

If your employer offers subsidized, tax-favored, traditional group
health coverage for you and/or your family, I'm pretty sure you are
better off with that. You can't have both.

- quote -

IRS Pub 969.

-Mark Bole

"JohnS" <jst[at]pop.ifi.no> writes:

- quote -

Congratulations!

- quote -

I'm in a similar situation, having maxed out both 401(k)/IRA and paid
off my mortgage. If you invest in a taxable account, IMO you *should*
worry about taxes. Index funds, tax-managed funds, or other actively
managed funds that pursue a buy-and-hold strategy are good choices.
I've also arranged things so that the majority of my bond holdings are
in a tax-free muni bond fund in my taxable account.

I've also been putting a good chunk of my money into doing Roth
conversion on an old traditional IRA, and 401(k) money from a former
employer. If your income is too high to do that now, you might start
setting aside some cash to do it in 2010 when the income limit is
supposed to be removed.

Other than that, you have choices, depending on what your interests
and goals are. Do you want to retire early or work part-time so you
can spend more time with your family, or start a hobby business?
Personally, I've been starting to put some money into home improvement
and big-ticket maintenance items that will increase the value of my
property.

Finally, as others have noted, you might also consider donating to
charity, taking that round-the-world trip, or otherwise using your
money to accomplish other life goals.

-Sandra

Mark Bole wrote:
- quote -

die healthy

the question was also framed to take into account the "pay the tax now" vs.
"can't put anymore into tax deferred plans" and what to do about it

jIM wrote:
- quote -

are there limits/rules on my establishing an HSA on my own or do I have to
wait for employer plan?

in case it matters, my employer will have one for 2008, enrollment starts in
oct-nov 2007

where can I read more about it?

Total Market Index Fund or ETF
International Index Fund or ETF

-Equities because they have best return for time
periods over ten years.
-Broad US/international funds for diversification.
-Index or ETF for low cost and tax efficiency.
Most of the index funds pay small distributions
until you sell them - on the order of a few
percent or less. Those gains are due to
changes in the index content and dividends.
Plus when you sell them taxes is will be at
the long term gains rate rather than the
higher deferred- income tax rate of 401K/IRAs.

JohnS wrote:
- quote -

This strikes me as a forest vs. trees question. What is your goal? To
die rich? To travel around the world? To quit working for pay? To
donate to worthy causes? To run for public office? Sounds like you are
in a good position to accomplish any of these. The best way to proceed
is to keep on doing what you are doing until you decide.

-Mark Bole

- quote -

There is a concept called "tax diversification"- having accounts with
different taxable charactoristics to take advantage of tax rules when
you need a withdraw.

For example your Roth withdraws should be tax free during retirement
For example a taxable account could be taxed at rates as low as 5% or
15% based on long term capital gains rates. Dividends are taxed at
similar rates in taxable accounts.
For example the 401k will be taxed at ordinary income tax rates (15%,
25%, 28%, 33%, 35%- depending on income level). The more you
withdraw, the higher the tax rate.

This might suggest contributing the 2k to any/all of the following:

1) taxable account
2) long term care insurance
3) health care spending account
4) real estate

am pondering best way to proceed the next 10-15 years or so, as I've managed
to pay off everything (mortgage, loans, debts) and am able to save an extra
2k per month.

my 401k plan is maxed out at 20.5k per year, before tax
my IRA contribution is limited & restricted because of the company 401k but
what money I could place there in previous years is growing nicely

my Roth IRA is maxed out every year at 5k

now, it seems the only way to continue would be to just create a taxable
savings or investment account and not worry about the taxes but sock the 2k
/ month away there or is there a better way?