What's your plan for healthcare after you sell your business? I've worked with 100+ retired business owners and executives. Here are a few things that may surprise you: + The average couple will spend over $350,000 on healthcare in the form of out-of-pocket expenses in retirement. (WSJ) + Retiring four years before Medicare starts can drain $100,000 from retirement savings. (WSJ) + Vision & Dental are not covered by Medicare. + At age 75, $16 of every $100 you spend in retirement goes to healthcare. (JPMorgan) + Average cost of healthcare is rising by 4.5% per year, nearly twice the rate of current inflation. (JPMorgan) Bottom line: If you're in a position to pay for your health expenses out of pocket NOW, investing your HSA contributions can set you up for a whole lot more marshmallows LATER. Not only do you get triple tax savings (contributions, growth, and withdrawals), if you invest your HSA contributions, you can build a bucket of dollars that can pay for Medicare premiums, for long term care insurance, and other qualified health expenses that are going up faster than inflation, at a time when you may not have the same earnings power as you do when running your business. And if you don't need the money for healthcare, you can treat the account like an IRA and just go buy a boat, a trip to Europe, or even marshmallows. After 65, the funds can be used for anything, although taxes will be assessed on withdrawals (like an IRA). ---------------------------------------- Want more? Sign up for The Slice, a monthly newsletter from PieCapital here: https://lnkd.in/e3ME9s87 Not advice. Talk to a professional about your specific situation.
Love this, Will. Whenever possible, I always try to add in quick bits like this for clients to better understand the benefits of a vehicle. And at the end of the day, who doesn't like comparing things to marshmallows!?
Great advice
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2moThough you can’t directly pay insurance premiums from an HSA for medical coverage prior to age 65 Medicare enrollment (but can pay COBRA premiums) you CAN save all of your receipts for medical costs between now and then and simply reimburse yourself in the future to offset the costs of those premiums with tax-free dollars.