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Ed Meek
CEO/Investment Advisor

Edge Portfolio Management

City:Winfield

State: IL



BIOGRAPHY:
At Edge, a low client to advisor ratio allows for personal and customized service for each individual.  Our goal is to work as a team for each client to provide not only portfolio management but wealth coordination and financial planning.  We make every effort to have frequent communication with our clients and to provide timely response to calls and emails.  I also enjoy spending time with my wife and three kids, playing and following basketball, playing golf, and participating as an advisory board member for Breakthrough Urban Ministries.

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Your Health Spending Account as a Retirement Fund

Health care spending accounts are a good way to save for medical costs down the line.

| BY Kent McDill

Many employed Americans have a second retirement account available to them other than the Individual Retirement Account or 401(k) opportunities, and should consider funding it to the maximum of their ability.

Health savings accounts, in which Americans can put pre-tax income for medical needs, is a way to create a fund that can pay for the much-feared cost of post-employment health care in the United States.

According to Spectrem’s first quarter wealth segmentation series report on the financial concerns and attitudes of affluent investors, 33 percent of investors with a net worth of between $1 million and $5 million worry that their retirement fund will be depleted early, and 70 percent of those investors blame concerns over health care costs as the reason.

Placing as much earned income as possible into health savings accounts could allay some of those fears.

According to MarketWatch, there was $24.2 billion held in health savings accounts at the end of 2014, and increase of almost $5 million and an increase of 3 million accounts over the end of 2013. These accounts have grown in popularity as employers have chosen high-deductible health insurance plans, which move more of the medical costs to employees but make HSA plans available.

Affordable Care Act marketplaces also offer individual and family high-deductible plans that are HAS-eligible.

Most high-deductible health insurance plans have deductibles between $2,000 and $3,000 before the health insurance payments kick in. As a result, employees are given the opportunity to move some of their income, pre-tax, into the HSA to pay those first medical bills.

There is a limit to how much a consumer can place into an HSA annually, but that amount is approximately $3,350 per individual and $6,650 for a family. Those 55 and over can add an additional $1,000 in “catch-up contributions”. If that money is not spent in the calendar year it is invested, it rolls over to the next year, and can continue to roll over.

Money in HSAs are not taxed on the way in, can grow on a tax-deferred basis if invested, and can be withdrawn tax-free to pay for qualifying medical expenses, whether those expense occur while working or while in retirement.

Currently, Medicare only pays about 80 percent of medical costs for Americans over the age of 64, which means those same Americans are responsible rot the remaining 20 percent. There are plans that can pay for most of the out-of-pocket costs, but those supplemental insurance plans are expensive.

HSAs can pay for anything Medicare does not cover, and can also pay for long-term care. The money is HSAs can also be used to fund long-term care insurance while the people who will need the care are still healthy.

 



About the Author


Kent McDill

kmcdill@spectrem.com

Kent McDill is a staff writer for Millionaire Corner. McDill spent 30 years as a sports writer, working for United Press International and the Daily Herald of Arlington Heights, Ill. From 1988-1999, he covered the Chicago Bulls for the Daily Herald, traveling with them every day through the nine-month season. He also covered the Bulls for UPI from 1985-88, and currently covers the team for www.nba.com. He has written two books on the Bulls, including the new title “100 Things Bulls Fans Should Know And Do Before They Die’, published by Triumph Books. In August 2013, his new book “100 Things Bears Fans Should Know And Do Before They Die” gets published.

In 2008, he resigned from the Herald and became a freelance writer. The Herald hired him to write business features and speeches for the Daily Herald Business Conferences and Awards presentations.

McDill also writes a monthly parenting column for the Herald’s Suburban Parent magazine.

McDill is the father of four children, and an active fan of soccer, Jimmy  Buffett and all things Disney.