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If youâre enrolled in Medicare, routine vision care isnât guaranteed. Some privately administered Medicare Advantage plans cover eyeglasses and eye exams. But Original Medicare â which provides health insurance to about 37.7 million Americans â doesnât pay for your new eyeglass frames or an annual vision exam. So how do you know, in your own [â¦]
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Health savings accounts (HSAs) have grown in popularity since the COVID-19 pandemic caused millions of Americans to worry about getting sick. A recent industry report from Devenir reveals that the number of new HSA accounts increased by 8% last year, and this trend is only expected to continue. By the end of 2024, there will likely be more than 38 million HSAs, with assets topping $150 billion. Itâs easy to understand why HSAs have increased in demand throughout the pandemic, since they are a great solution to help cover unexpected medical costs â like an unplanned hospital stay.Â
But HSAs are more powerful than most people realize. For example, Voya research reveals that only 2% of individuals are aware of the key attributes of HSAs.(1) With employers increasingly offering high-deductible health plans with an HSA option to their employees, chances are you already have an HSA or perhaps are considering opening one. Whether you are a pro when it comes to HSAs or just using one for the first time, we all can find value to reviewing ways that we can realize the full potential of these powerful savings, spending and investing vehicles.
Read these 10 tips to help maximize the benefits of your HSA.
The pandemic-era trend known as the âGreat Resignationâ has led to a record number of people voluntarily quitting their jobs as many are changing course for a variety of reasons â increased compensation, greater flexibility or better workplace benefits, to name a few. In fact, a record 4.5 million Americans quit their jobs in March, according to the U.S. Department of Labor. Therefore, if you fall into this category and are considering switching jobs, thereâs no need to worry about losing any of the hard-earned dollars you contributed to your HSA. If you leave your job (for whatever reason), your HSA comes with you â since you, not your employer, own the account.
Typically, when most people think about their workplace benefits, they may have âflashbacksâ to their employerâs open enrollment period. For many, open enrollment can be a stressful time, having to consider all of your needs and making the right choices for workplace benefits for the following year. Interestingly, Voya research reveals that the majority of American workers (72%) indicated they would rather service their car, visit the dentist or prepare for tax season instead of reviewing their workplace benefit options.
Now, while you do need to enroll in an HSA during open enrollment, deciding how much to contribute from each paycheck is not something you need to stress over. What do I mean? While most employers will usually offer digital tools or calculators to help you estimate your health-related expenses for the upcoming year, at the end of the day, itâs still just an educated guess. A great feature of HSAs is that you can change how much you contribute at any time during the year. You donât need a qualifying event â like getting married or switching jobs â to make changes, which is a typical requirement for most other workplace benefits. Thatâs a big relief and one less thing to worry about during open enrollment.
Perhaps the biggest benefit of an HSA is the triple tax advantages it offers: 1) contributions are pre-tax and reduce your taxable income; 2) your HSA contributions and any earnings grow tax-free; and 3) when used to pay for eligible medical expenses, HSA withdrawals are tax-free.
HSA contribution amounts are capped each year by the IRS. For 2022, the HSA contribution limits are $3,650 for individuals and $7,300 for family coverage. Individuals who are 55 or older are also eligible to make an additional $1,000 catch-up contribution. To help adjust for rising inflation, the IRS recently announced that it was boosting HSA contribution limits in 2023 â with the HSA contribution limit increasing to $3,850 for individuals and $7,750 for family coverage.
Itâs not uncommon for people to confuse HSAs with their cousin, flexible spending accounts, or FSAs. While their names might sound similar, the rules that govern these accounts are quite different. One of the biggest drawbacks surrounding FSAs is the âuse it or lose itâ rule. In most cases, you must spend all the tax-free funds you put aside in an FSA before the end of each plan year, or risk losing the money.
People often mistakenly think the same rule applies to HSAs. However, unlike an FSA, your HSA balance carries over each year, which can add up over time.
The ripple effect of the pandemic shined a spotlight on a troubling reality: Most working families are not financially prepared to cover an emergency. Industry research shows that roughly 4 in 10 Americans would struggle to cover a $400 emergency expense. Faced with a short-term, unexpected need â such as a trip to the hospital â many people often dip into their retirement savings. In fact, Voyaâs own customer data reveals that employees without adequate emergency savings are three times more likely to take a loan from their retirement plan.(2)
Fortunately, the dollars in your HSA can double as an emergency savings account. All HSA withdrawals used to pay for qualified medical expenses (even if unplanned) are tax free. Plus, you can choose to cover a medical bill out of pocket and then be reimbursed tax-free for that expense in the future. This strategy is another way HSAs can serve as a potential emergency savings vehicle for eligible health-related expenses. Just make sure to hold on to your receipts to verify all distributions.
Once you reach a certain threshold in your account, your HSA funds can be invested. These investment options are similar to line-ups available in typical workplace retirement accounts, like a 401(k). And you donât need a large HSA balance to begin investing the funds. In many instances, you only need an HSA balance of $1,000 or more. However, this threshold varies by HSA plan, so check with your employer.
Unless you plan to use your HSA money for planned expenses in the near future, investing can give your money an opportunity to grow over time. For example, if you invested the 2022 HSA individual contribution limit of $3,650 in your account every year for 10 years and didnât use any of the funds, and your account earned an overall 6% of interest each year over that time period, you would end up with about $51,000. While you would have contributed $36,500 yourself, the remaining $14,500 would come from investment earnings.
Like with any investment, itâs important to remember there is always risk. That being said, HSAs can serve as an important vehicle to help grow your future savings over the long term. Plus, with inflation at a 40-year record high, investing your HSA dollars is another option to potentially protect the value of your hard-earned money and make it work harder for you in the future.
To encourage participation in high-deductible health plans with an HSA, itâs not uncommon for employers to offer incentives or matching contributions. For example, some will offer their employees $100 just for enrolling in an HSA. Plus, they may offer additional contributions throughout the year as the employee visits their doctor for an annual check-up, completes a biometrics screening or participates in other financial wellness programs, for example.
Itâs not required that employers offer incentives or matching contributions to help supplement their employeesâ HSA funds, so make sure to check with your HR team. But if available, taking advantage of potential âfree money on the tableâ is a smart way to help grow your HSA.
A required minimum distribution, or RMD, is an IRS-mandated amount of money that a retiree must withdraw each year from a traditional IRA or an employer-sponsored retirement account, like a 401(k). Recently, this topic has generated headlines, with lawmakers in the House overwhelming passing The Securing a Strong Retirement Act of 2022, or âSECURE 2.0.â In addition to other provisions aimed at helping American workers save for retirement, the bill proposes increasing the age to 75 when a retiree must withdraw RMDs.
While this is certainly good news, considering the current RMD age is 72 (and that was only recently increased), HSAs do not require minimum distributions â another benefit of this powerful savings vehicle. Therefore, retirees can use their HSA funds to help supplement their future retirement savings and withdraw their money when they need it. Plus, if their HSA funds are invested, it has the potential to keep growing well into their retirement years.
When you reach retirement age at 65, HSA funds can be used for non-medical expenses without being assessed a 20% penalty. Therefore, you can use your HSA to pay for general living expenses â like housing, food or travel, for example. However, the distributions will be taxed like any normal distribution from a retirement account, like an IRA or 401(k). But, if you decide to spend your HSA dollars on qualifying medical expenses, you will still enjoy tax-free distributions.
The good news is that you now have greater flexibility to spend your money how you want in retirement.
When it comes to estate planning, taxes are something all of us should carefully consider to help ensure as much of our life savings goes to the people we love versus the IRS. Fortunately, HSAs can be transferred to spouses without any tax implications. Your spouse can also continue using the HSA funds for qualifying medical expenses and will receive the same tax-advantaged treatment.
1) Based on findings from an online survey conducted by Voya, in partnership with Russell Research, among 315 U.S. Consumers currently enrolled in an employer-sponsored health plan fielded from Sept. 2 â Sept. 6, 2020
2) Voya Financial internal data (Oct. 2020)
If youâre wondering what is the difference between a deposit and a withdrawal, the truth is that they are exact opposites: A deposit is money put into a bank account for safekeeping until you need it. A withdrawal is money thatâs taken out of your account. At the most basic level, one of these transactions […]
The post Differences Between a Deposit and Withdrawal appeared first on SoFi.
Have you ever bounced a check and paid the price? Fees can be steep and the embarrassment, too, when you donât have enough in your account to cover the check ⦠or checks. Luckily, other options, like certified checks, can help you avoid this scenario. And there are times when a certified check is requested [â¦]
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There are nearly 1 million income-restricted apartments and rental homes in the United States. That translates into the federal government
The post What Does Income-Restricted Housing Mean? appeared first on The Rent.com Blog : A Renterâs Guide for Tips & Advice.
This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.
GameStop (GME, $139.66) has been in focus recently as shares of video game retailer have been volatile. Specifically, shares are up almost 72% from their mid-May bottom near $81 (though they’re still down 10.6% on a year-to-date basis).
While not nearly the parabolic moves GME made when it earned its status as a meme stock back in early 2021, they are notable nonetheless.
And GME will remain in the limelight thanks to its spot on this week’s earnings calendar. GameStop will unveil its first-quarter results after Wednesday’s close.Â
The company reported a quarterly loss in its last report, and analysts don’t seem too upbeat this time around.Â
Wedbush analyst Michael Pachter has an Underperform (Sell) rating on GME and says he’s “hard-pressed” to find any potential drivers of revenue growth.Â
“GameStop expanded its product offering to PC games and accessories, and we expect this category to add as much as $300 to $500 million in annual sales in the next few years, but we do not believe that the category will comprise a sizable portion of overall revenue,” Pachter says.
Consensus estimates are for GameStop to report a per-share loss of $1.45 â much wider than the 45 cents per-share loss it recorded in the year-ago period. Revenue, meanwhile, is expected to be up a modest 3.1% year-over-year (YoY) to $1.3 billion.
Like so many other tech stocks, Salesforce (CRM, $161.45) has had a rough year on the charts. Shares are down more than 36% so far in 2022 â second only to Boeing (BA) in terms of worst year-to-date return among all the Dow Jones stocks.
But off the charts, CRM has “run into challenges,” too, says Oppenheimer analyst Brian Schwartz.Â
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“Salesforce is likely experiencing slowing demand, mostly from the macro headwinds but also partly from execution,” Schwartz explains. This, combined with worsening forex headwinds, “points to good but not great bookings and to Salesforce maintaining its constant-currency guidance.”
Still, the analyst has an Outperform (Buy) rating on CRM, saying valuation remains reasonable when looking at the company’s free cash flow (FCF) multiple against future FCF growth estimates. As such, “Longer-term investors have a unique opportunity to buy CRM’s growth at a reasonable multiple,” Schwartz adds.
For Salesforce’s first-quarter earnings report, due out after Tuesday’s close, analysts, on average, are calling for earnings of 94 cents per share (-22.3% YoY) and revenue of $7.4 billion (+23.3% YoY).
Lululemon Athletica (LULU, $294.61) has had a rough go of it on the charts recently, with shares down about 28% from their late-April peak above $400. However, LULU shot up more than 10% on May 26 after Morgan Stanley analyst Kimberly Greenberger upgraded the retail stock to Overweight from Neutral â the equivalents of Buy and Hold, respectively â saying the retail stock’s selloff has created a compelling opportunity.
Will Lululemon’s first-quarter earnings report â due out after Thursday’s close â keep the wind at the stock’s back?
William Blair analyst Sharon Zackfia (Outperform) is expecting the athletic apparel retailer to post a “strong first quarter,” with the company likely to record its seventh straight quarter of 20%-plus year-over-year revenue growth.
“As reflected in management commentary indicating strong momentum in the business at its April 20 investor day, we expect Lululemon will meet or beat our projections for revenue and adjusted EPS at the high end of guidance, particularly as management reiterated comfort with both first-quarter and full-year guidance,” Zackfia says.
For its first quarter, LULU is anticipating revenue to arrive between $1.525 billion and $1.55 billion, representing annual growth of 24% to 26%. Earnings per share are expected to land between $1.38 and $1.43 per share, compared to the $1.16 per share it reported in the year-ago period.
Wall Street’s pros, for their part, have consensus estimates for earnings of $1.43 per share (+23.3% YoY) and revenue of $1.53 billion (+27.5% YoY).