But with an FSA comes a little risk. A year’s worth of medical expenses can be tricky to estimate, so depositing too much money — or simply forgetting to spend it — can result in a big loss if you’re not careful. Luckily, if you have a rollover or grace period, your money wi...
Another option is anIndividual Coverage HRA (ICHRA). This plan has only been available during the past few years, and a recent change has made them more appealing to small business owners. Now, this individual plan can be used to cover insurance premiums. Employees can use the money in thi...
2. Funds grow tax-free in your HSA. You can let them accumulate nominal interest or invest the money in your HSA in stocks, bonds, ETFs, mutual funds and other securities, where it will earn a much higher return. If you need to pay a medical bill, you can sell investments. (Some ...
BothIRAsand 401(k) plans are typically tax-deferred but a 401(k) is offered through an employer, while you commonly open and fund an IRA yourself with the help of a bank or broker. Thecontribution capon a 401(k) plan is much higher and you may even be able toborrow moneyfrom the a...
With a traditional 401(k), you contributepre-tax dollars. This means that the money you put into your 401(k) will reduce your taxable income for the year. You’ll pay income tax on the money when you withdraw during retirement.