| News from Washington |
| EBSA Official Expresses Confidence in Legal Strength of Retirement Security Rule A day after an insurance agent advocacy group filed a motion to pause the Labor Department’s new retirement security rule, Timothy Hauser, Deputy Assistant Secretary of the Employee Benefits Security Administration, said that the new rule is different from the previous one in a few respects and is designed to address shortcomings from a court ruling on the previous rule. Read More |
| Market Trends |
| Financial Wellness Gap Between Men, Women Continues to Widen The number of employees feeling financially well in 2024 is trending up, according to a report from the Bank of America Institute. Although, 47% of employees rated their financial wellness as “good” or “excellent,” women expressed significantly lower financial wellness scores than men, signaling that employers need to do more to address pay equity and other challenges. Read More |
| Best Practices |
| Adjusting HSA Contributions to Pass Non-Discrimination Testing We just ran nondiscrimination testing on our Health Savings Account contributions, and we didn’t pass. What do we do now? A best practice is to test the plan at the beginning of the plan year. That way, if your program doesn’t pass, you can adjust employee elections to bring it into compliance. If your plan fails an early plan-year test, you may place a limit on contributions that certain key and highly compensated employees can make through the Cafeteria Plan. Read More |
| HSAs & Retirement |
| America Is Hurtling Toward a Gray Trap It’s little surprise that America is rapidly getting older — but now that we’re at the brink of that demographic shift’s major consequences, we’re still completely unprepared. It’s not just that seniors are an increasing share of the population, which is a huge challenge in itself. The seniors of the future may also require care for longer, and aging inequalities are becoming more stark. Read More |
| Medicare & HSAs — the Perfect Pair in Retirement Planning Are HSAs and Medicare a perfect union when retirement planning? A recent panel at the Broadridge 360 Advisor Summit thinks so. One panelist argued that Medicare education must be embedded in retirement planning. Other panelists noted that such discussions should also center on HSAs as a compliment to traditional 401(k) retirement strategies. Read More |
| Maximizing Your HSA |
| Bridging HSA Eligibility Gaps When you lose and subsequently regain your eligibility to fund your HSA, you may be able to reimburse those qualified expenses that you incurred during the eligibility gap with new contributions. To do so, you must be either lucky or understand the process and plan. Once you understand the process, you can control your situation rather than leaving it to chance. Read More |
| This Investment Account Offers ‘Rare Triple-Tax Benefits’ That Are Easily Overlooked—and You Can Contribute Even More Next Year Health Savings Accounts are vastly underused as a retirement investment tool by people who have them, even though thousands of dollars can be invested every year. HSA funds can be invested and grow tax-free, just like a 401(k) or individual retirement account. And in 2025, you can contribute more, as the IRS has recently announced a limit increase. Read More |
| 4 in 10 Americans Aren’t Prepared for a Medical Emergency. This Account Could Help 41% of Americans do not feel prepared to cover unexpected out-of-pocket medical expenses, according to one survey. But funding an HSA could make it easier to sock away money for medical expenses, due to the tax break involved. If you put $1,000 into an HSA, that’s $1,000 of earnings the IRS won’t tax you on. So it pays to find out if you’re eligible for it. Read More |
| HSAs Come with Pitfalls — Here’s How to Avoid Them Pretax contributions, untaxed investment earnings and penalty-free withdrawals for qualified medical expenses provide ample appeal for HSAs as a savings vehicle for healthcare costs or even retirement in the future. On the other hand, HSAs carry restrictions that could make the tax perks a far less attractive proposition. Here’s how to avoid them and maximize your HSA. Read More |
| Consumer-Driven Health Care |
| Paying for Medical Needs with an HSA: Distinct Considerations for Women A recent study shows that nearly three in four adults are concerned about medical costs. This financial worry is particularly acute for women who collectively spend $15.4 billion more on out-of-pocket medical expenses annually compared to their male coworkers. A Health Savings Account can play an important role in helping women to plan, save and afford medical care. Read More |
| Dense Breast Patients Battle to Get Coverage for Cancer Screenings National panels have released new guidance for breast cancer screenings, but some people are finding out that insurance companies don’t cover them all. There are several different types of screenings and there is no clear evidence that some are absolutely necessary. What would supply sufficient evidence to get ultrasounds covered for those with dense breasts at any age? Read More |
| Flexible Spending Account Forfeitures Slightly on the Rise The Employee Benefits Research Institute found that roughly half of FSA participants are forfeiting funds to their employers. Average forfeitures averaged $441 in 2022, up from $339 in 2019. Forfeitures totaled $1.4 billion in 2022. Unlike people with HSAs, FSA participants risk forfeiting funds if they do not spend their FSA by the end of the plan year. Read More |