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Heath Savings Accounts – Growing in Popularity

The popularity of Health Savings Accounts, HSAs, has soared over the past 10 years. Designed as a way to help people manage high-deductible health insurance plans, financial experts believe that the attractiveness of these accounts will only continue to grow.

HSA Qualifications

If you are currently enrolled in a high-deductible insurance plan (HDHP), you can qualify for a HSA. By the 2017 definition, the IRS defines a HDHP for an individual as a plan with an out-of-pocket maximum of $6,550 and a minimum deductible of $1,300. For a family, the out-of-pocket maximum is $13,000 and the minimum deductible is $2,600.

How does a HSA Work?

Most health insurance providers offer HSAs. But, if yours doesn’t, you can open an account at most financial institutions.

If you qualify, you can currently contribute up to $3,400 as an individual and $6,750 as a family. Adults over 55 can increase these amounts up to an additional $1,000. If your place of employment offers a HSA, you can set up automatic contributions directly from you payroll.

Using a debit card or checks for this account, you can use these funds for eligible medical expenses. These include deductibles, co-pays, coinsurance and many other qualified medical expenses not covered by your insurance plan. However, you may not pay your medical insurance premiums with HSA funds.

The balance of a HSA, unlike Flexible Spending Accounts, rolls over from year to year. Consequently, you never lose your savings, even if you leave your employer.

Once you’re over the age of 65 and enrolled in Medicare, you can no longer contribute to a HSA. However, you can still use the balance of your savings for out-of-pocket medical expenses. If you use the money for non-medical expenses, you will have to pay income tax on that amount…and a penalty if you’re under 65 years old.

Triple the Tax Benefits

Three tax benefits make HSAs especially appealing. HSA contributions are pre-tax/tax-deductible, just like an IRA. This means your contributions are made before your income is taxed. In addition, you don’t incur taxes on the account’s growth, either. And lastly, the money withdrawn to pay eligible medical expenses is also tax-free.

The Investment Potential of a HSA

HSAs can be invested in mutual funds, stocks and other investment vehicles to generate more money. Financial experts tout the HSA as one of the best tax-free investment accounts out there, especially for those investors that have already maxed out their 401(k) and IRA contributions. The HSA provides yet another place to save in a tax-advantaged way.

For more information and/or to open a Health Savings Account contact or stop by one of our banking locations today.

 

 

 

 

Creating a Beautiful Wedding Day on a Realistic Budget

As we move into the summer months, many parents will also be heading into the wedding months.

Although, as parents, this is a milestone, a rite of passage in your life as well as your child’s, this can also be a very stressful time as well.

The cost of a wedding today can be overwhelming. Whether you’re picking up the entire bill for your child’s big day or sharing the cost with the bride and groom-to-be or his or her perspective in-laws, having a well-thought-out plan and a realistic budget will help keep what should be one of the most memorable days of your life and your child’s from getting out of control.

In a perfect world, we would’ve started saving for this big day shortly after our child was born…in addition to saving for his or her college and our retirement fund. But, if you’re like most parents, this just wasn’t doable. Although, it’s an admirable goal to save for your child’s wedding, most financial experts would advise that this shouldn’t be prioritized over college or retirement.

This is not to say that it’s too late to save, however. As soon as you know that a wedding is on the horizon, you should start saving.

But, don’t promise what you can’t deliver. As much as you’d like to be able to give your child the wedding of his or her dreams, it’s definitely not worth jeopardizing your financial viability to do it. For example, if you withdraw money from your retirement account pre-59 ½, you could face a penalty as well as additional taxes. In addition, you may never be able to replenish the money you withdrew or make up it’s earning potential, which could really set you back.

The first step in reducing the financial stress often associated with wedding planning is by simply talking about it. Sit down and talk with the bride and groom-to-be and put your financial cards, so to speak, on the table. This way, the couple has a realistic idea of what they can expect from you and the big day in general.

The second step is to find ways to save money.

You don’t have to break the bank to give your son or daughter a beautiful wedding day. Here are a few suggestions to save money on the big day without sacrificing the memories.

Limit the Guest List – One of the easiest ways to reduce the wedding budget is to reduce the guest list. Yes, a wedding is a celebration. But, keep in mind, it’s also an intimate moment. Be realistic. If budget is a concern, limit your guest list to the immediate families and closest friends. Not only will this save a lot of money but it will also be a more meaningful day.

The Dress – Many women spend a good portion of their lives fantasizing about their wedding dress…and consequently, spend a good portion of the wedding budget on it. This doesn’t have to be the case. It’s possible to find a gorgeous dress for far less than the exorbitant prices charged by most bridal salons (e.g. secondhand stores, eBay or consider using a family member’s gown).

Reception – This typically is the most expensive part of the big day. Consider cutting the cost of the reception by holding the wedding on a Friday or Sunday and/or opt for a brunch or cocktails and hors d’oeuvres or dessert/cake/champagne or possibly a garden picnic over a full, sit-down dinner. If you want a dinner meal, consider a buffet with less expensive items like chicken, pasta and in-season produce.

Music – Have the bride or groom-to-be load up the playlists on their iPod or iPhone for each part of your wedding – pre-ceremony, ceremony, cocktail hour, special dances, dinner, dancing, etc. Ask a member of the wedding party to act as MC for special announcements.

Flowers – To cut costs on the wedding flowers make sure to only order in-season flowers and use the same flowers at the church and the reception. You can also reduce this expense by ordering loose stems and making the arrangements yourself. In addition, flowers ordered online are typically less expensive than those ordered through a traditional florist.

Drinks – It’s a personal option whether to serve alcohol or not. But, if you’re going to serve alcohol, you can save money by offering only beer and wine and/or a champagne punch. But, make sure to have ample non-alcoholic beverages as well.

What You Can Skip – Most guests toss wedding favors as soon as they get home. If you absolutely have to give out favors, make something yourself…like baking a special treat (cookies).

You can also eliminate the unnecessary expense of save-the-date cards unless it’s a destination wedding, requiring people to make travel arrangements well in advance.

With all of these suggestions in mind, remember that budgeting and saving money doesn’t mean that you’re skimping on your child’s big day. With imagination, creativity and open communication, you can still have a beautiful wedding day for your child on a realistic budget.

Happy planning!

Dollars and Sense Series Article for March A Day in the Life of Flagler County’s “Hometown Community Bank”

From the moment you step through the doors of the Key West architecturally themed home of Intracoastal Bank, Flagler County’s “Hometown Community Bank,” you immediately sense a different atmosphere. From the warm friendly greetings, freshly baked aroma of Otis Spunkmeyer chocolate chip cookies, freshly brewed coffee, signature bottled water, and “Customer Appreciation Days” to the dog biscuits for Fido, you will be quickly immersed into a new banking experience. Dorothy, you are not in Kansas….I mean “big bank land” anymore!

With Americans becoming more and more frustrated with the “big banks” or as commonly referred to as the “big box banks,” many are making the choice to move to smaller, more personable community banks. Many American consumers have become fed up with the mergers, buyouts, bailouts, and huge executive bonuses. They feel that these large institutions have lost touch with old-fashioned customer service and serving their community.

When Intracoastal Bank opened its doors on June 16, 2008, we were determined to be different. Our goal was to be different in so many ways. We are not a corporate giant. We are a small bank with hometown values and practices. Our size allows us to be able to customize our products and services to meet the needs of our customers.

Not only are our customers and a growing number of Flagler County residents aware of a change in the air, but our employees as well have a full sense of our unique institutional culture and work environment. Our bank’s core values prioritize teamwork, recognizing that each team member plays a vital role in our overall success. Our overall philosophy empowers our employees to make decisions without having to jump through the big corporate hoops.

We make decisions locally, typically around our upstairs conference table. This allows a much quicker turnaround on loan decisions and decisions pertaining to our customers’ accounts. If a customer ever has a question or concern, “management” is always available. Our management team has an open door policy. The decision makers are not hidden away in offices located on the 43rd floor of a skyscraper in a major metropolitan city. Our decision makers are always accessible and that’s the difference.

Similar to the Bailey Building and Loan Association depicted in the Christmas movie classic “It’s a Wonderful Life,” we pride ourselves in giving our customers a friendly, small town, face to face banking experience. As our cute, recognizable mascot implies, we like being the small fish in the big pond. We are a close, happy family…..employees and customers!