Inheritance Planning Made 123Easy
Welcome to Inheritance Planning Made 123Easy, where father-son duo David and Ian Schaeffer bring a family-centered approach to inheritance planning, retirement security, and building legacies that last. As part of American Retirement Advisors, David and Ian have helped countless families protect what matters most and ensure that what they’ve built is preserved for generations to come.
In each episode, they’ll walk you through the essential steps of inheritance planning, from organizing vital documents to protecting assets, minimizing taxes, and communicating family values and goals. With a focus on the “3 P’s” of inheritance planning—Prepare, Protect, and Preserve—they’ll show you how to align today’s financial choices with tomorrow’s family needs, keeping relationships and family dynamics at the heart of the process.
David and Ian don’t just talk about inheritance planning for clients—they bring their own family into the conversation. Join them as they discuss the plans David is putting in place for Ian, his sister, and granddaughter, sharing personal stories and expert insights to help you make confident decisions for your loved ones.
Whether you’re just starting your inheritance planning journey or refining an existing strategy, Inheritance Planning Made 123Easy offers clear guidance, real-life examples, and practical advice at every stage. Ready to take the next step? Tune in, and let’s make inheritance planning simple, supportive, and family-focused!”
Inheritance Planning Made 123Easy
S1E57 HSAs - Beware Before Medicare
Can I keep contributing “Tax-Free” to my HSA after I go on Medicare?
What about using the money I've saved all those years after my Medicare starts?
We’ve got all those answers and more, this week on 65 and Counting!
We will help you avoid penalties by telling you when to stop contributing.
Stay or Go Analysis™ https://www.tfaforms.com/4688178
Workshop Schedule and Registration: www.123EasyMedicare.com
HSAs.gov link: https://www.irs.gov/forms-pubs/about-publication-969
Call the office: 602-281-3898
Email Adam: Adam@AmericanRetire.com
Can I keep contributing “Tax-Free” to my HSA after I go on Medicare? What about using the money I've saved all those years after my Medicare starts? We’ve got all those answers and more, this week on 65 and Counting!
Welcome back, everyone! This week we’re shining the educational spotlight on a very special kind of savings account called an HSA or Health Savings Account and how it relates to your Medicare! What is it? And just what does it do?
Fundamentally, an HSA is a savings account. These savings accounts are available to people who have high deductible health plans or HDHP’s. The money that you put into one of these accounts, is deposited tax-free and when you take money out for a qualified medical expense, it’s not taxed either! Typically your employer will offer the opportunity to contribute to an HSA, but you can also get an individual HSA from banks, insurance companies, and credit unions!
Now, in order to qualify to put money into an HSA, you have to be enrolled in a qualified high-deductible health plan. These health plans require you to meet a specified deductible before you begin receiving coverage. The money in an HSA can be used to pay for any qualified healthcare expenses. The balance does not need to be used in a specific plan year - it's like a bank account - you can use the funds for qualified medical expenses or leave the money there until you need it.
What qualifies as a medical expense to use the money in your HSA? Well, the IRS made a long list of what is considered “qualified” and what isn’t. This list is constantly changing and being updated. To find the most recent and updated information you can visit the IRS webpage and download a copy! I’ll include that link in the description of the episode.
https://www.irs.gov/forms-pubs/about-publication-969
What about using my HSA for dental and vision expenses? Yes, those are qualified expenses too! Take a look at the list of qualified expenses to get a better understanding of the benefits of using your HSA for those expenses.
Now, if you’re coming up on being eligible for Medicare AND have an HSA, listen carefully because it’s VERY important to understand how enrolling in Medicare will affect your HSA.
Why?
Well, before you enroll in Medicare’s Part A and/or B you need to stop contributing to your HSA! Remember, those are tax-free dollars! You can’t contribute to an HSA and have Medicare or Medicaid. Let me say that again- you cannot have Medicare AND contribute to an HSA or you will pay hefty tax penalties.
We recommend stopping your HSA contributions six months before your Medicare begins. Yes- six months.
It's important that whoever is overseeing that HSA account changes your contribution to $0 per month. Otherwise, the IRS penalty and payback are pretty steep.
Stopping your contributions does not, however, restrict you from continuing to take that money out of your HSA. And after enrolling in Medicare you can use that account to help pay for medical expenses such as deductibles, some of your premiums, co-pays, etc. And if you’re using that money for qualified medical expenses, it’ll still be tax-free!
Yes, you heard me say ‘premiums’! You can use your HSA to pay for certain premiums like Medicare Part B, your Medicare Advantage Plan (if it has a premium), and Prescription Drug Plan. You can even use it on long-term care insurance premiums!
But Wait! The one premium you can’t pay with your HSA is a Medicare Supplement or Medigap plan premium!
So talking about HSA’s brings us back to a question we ask a lot here on 65 and Counting! Should I stay or go?
Should I delay enrollment in Medicare and keep contributing to my HSA and keep my employer's insurance or should I stop my HSA contributions, leave the employer group, and go on Medicare and enjoy all the benefits that come with it? Maybe we should do an episode about that….. Or maybe we already did! I’ll include a link to our episode on the Stay or Go analysis in this episode's description! https://youtu.be/DdNqR1veeww
If you are already enrolled in Social Security there is another important thing to consider regarding HSAs: you cannot contribute money to HSAs if you are collecting social security. Why? If you’re collecting social security you’ll automatically be enrolled in Medicare’s Part A and B.Remember, you can’t have Medicare and contribute to an HSA. Folks can always delay enrollment in Part B, but there’s nothing you can do to stop Part A if you are collecting social security. And if you have Part A you wouldn’t be able to put those tax-free dollars into the HSA!
Another type of tax-free health savings plan is called an HRA or a Health Reimbursement Arrangement. Now these are similar to HSAs but there are some very important differences! The whole idea in having these types of accounts is to make healthcare costs more manageable for individuals. HRAs are offered by employers to help their employees offset medical costs and they don’t need to be on a HDHP. The employer contributes to these accounts, not the employee. HRA’s are use-it-or-lose-it plans and they stay with the employer when you leave the company. In comparison, HSA’s are YOUR money. Even if you leave your employer- the money goes with you. Both types of savings accounts use funds for qualified medical expenses- but the medical lists you can use the funds for are vastly different. HRA funds are regulated differently than HSAs too. We’ll get into more HRA details when we shine the educational spotlight on them!
In closing, HSAs are a great way to save taxes to pay for important medical expenses, but there are some risks to having them when it comes to Medicare and are easily avoided when you consult with a Medicare expert like a Certified Medicare Planner to help you create a strategic plan before you need to enroll.
I hope you learned a whole bunch about HSA’s this week! And we’re always standing by to help answer any questions you may have! Our phone number and my email are included in the description of the episode!
Thank you so much for tuning in this week! Don’t forget to like the video, subscribe to our page so you get notified when new episodes come out, share with all your family and friends, and most importantly, have a great week!
