Category Archives: investing

What happens to the un-used funds in my HSA if I die?

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That depends on who you have named as your beneficiary on the HSA. With the Health Savings Account (HSA), you deposit pre-tax dollars into an account for your health care needs. Any earnings on the balance accumulates tax-fee. If your beneficiary is your spouse, he/she can use the dollars just as you would. If your spouse uses the dollars for anything other than health care, ordinary income tax will be owed. If your beneficiary is non-spousal, the HSA dies with you. Your heir will have to withdraw the funds and pay tax on the distribution.

disclosures:http://www.hechteffect.net/?page_id=31

They may be little red flags, but they are red flags none the less.

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Have you noticed small changes when talking to your parents? Nothing big, just little mentions about almost getting the power turned off because they forgot to pay the bill. Your Dad tells you they got a letter from the IRS stating they now have to pay penalties for not filing their tax return. You go visit them and notice that their desk is piled high with papers, a sight you normally do not see. You glance at their checkbook and see errors in an account that was once flawless. These may be signs of diminished capacity or the beginnings of Alzheimer’s disease.

One easy thing you can do to protect your parents is to meet their Certified Financial Planner Professional, their CPA, attorney, and banker. You can asked to be contacted if your parents start exhibiting odd behavior, like going to the bank three days in a row to withdraw the same amount of money, or suddenly changing how they have their assets invested. You don’t need to be called upon for every meeting or decision they make, but, it is nice to know that your parents will have you for their financial professionals to reach out to if a red flag pops up.

disclosures:http://www.hechteffect.net/?page_id=31

More good news from the IRS

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Many of us like the idea of a Roth IRA but cringe at the thought of converting a Traditional IRA to have one. No one really likes to pay taxes any sooner than required. Now the IRS has finally cleared up the rules on transferring from a 401(k) account to a Roth IRA.
Taxpayers can split off their after-tax money in their 401(k) account and send it directly to a Roth IRA.
Roth IRA accounts, under current tax law, accumulate interest on a tax free basis and do not require minimum distributions at age 70.5. This account may be the answer for your after-tax deposits in your 401(k).

disclosures:http://www.hechteffect.net/?page_id=31