Ask HTM – Budgeting to Care for an Aging Parent, Car Subscription Plans, and Timeshares #128

Self-Employed

Joel Larsgaard and Matt Altmix tackle the challenge of managing healthcare costs for the self-employed. They emphasize the importance of Health Savings Accounts (HSAs) in keeping premiums low and investing for future expenses. Matt highlights that employers typically cover 60% of healthcare costs, a significant benefit self-employed individuals miss out on 1.

Employers are expected this year to pay about 60% of total healthcare costs. For a typical family of four, that's $17,000 a year.

--- Matt Altmix

Joel suggests exploring state-specific healthcare costs and considering healthcare sharing options as viable alternatives 2.

   

Family Costs

Managing healthcare costs for families involves strategic planning and exploring various options. Matt points out that as children grow older and become independent, overall family healthcare costs may decrease 3. He also shares his personal experience with healthcare sharing plans, which can be a cost-effective alternative to traditional insurance 4.

For us, we were paying under $400 for a family of five with a high deductible. It's been a great option.

--- Matt Altmix

Joel adds that having a substantial cash cushion can help cover out-of-pocket expenses without tapping into retirement accounts or HSAs 4.

   

HSA Benefits

HSAs offer significant advantages for managing healthcare expenses efficiently. Matt explains that contributing to an HSA not only lowers premiums but also provides tax benefits and potential subsidies on the exchange 1. He also stresses the importance of keeping receipts for healthcare expenses to withdraw money tax-free from HSAs in the future 5.

By investing in an HSA, you're able to keep your income lower, possibly scoring some of those sweet subsidies on the exchange.

--- Matt Altmix

Joel notes that maintaining receipts is crucial for taking advantage of manufacturers' warranties and credit card benefits 5.