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Many people view their health savings accounts (HSAs) as a tool to pay for health expenses. It certainly can be used for that, and while that may have been the original intention of their creators, many forget that the funds contributed can end up being used in the same way as retirement plan funds. Withdrawals taken after age 65 are not subject to penalty (in the way they would be if taken before age 65 and used for non-qualified expenses) and can be used at the account owner’s discretion.

The individual must be covered by a high-deductible plan. They can contribute up to the annual maximum limit of $4,300 in 2025 (plus an additional $1,000 if they are age 55 or older by the end of the year) to contribute to an HSA. Suppose the same individual’s family is also covered under the high deductible health plan. In that case, the contribution limit rises to $8,550 (plus an additional $1,000 if they are 55 or older by the end of the year). There are no income limits that apply to HSA contributions. Employers can contribute to an employee's HSA. Just be aware that those contributions count towards the aforementioned annual limit. Because most HSA contributions are made through payroll, they avoid FICA tax and are deductible for federal income tax purposes. Even those who make contributions outside of payroll can take a subsequent deduction for federal taxes when filing their return.

The end of one’s life is never easy to talk about. However, many clients may not have an optimal plan to ensure their assets pass efficiently when they are gone. Outside of basic wills and POAs, many higher-net-worth families can take advantage of the higher estate tax exemption from the Tax Cuts and Jobs Act (TCJA). This current law is set to expire at the end of 2025.

The estate and gift limits are unified, meaning that gifting above the annual exemption amount ($18,000) counts towards the limit, as do certain assets passed to heirs at death. Before the passing of the TCJA, the lifetime exemption for estates and lifetime gifting went from 5.49 million to $11.18 million and currently sits at $13.61 million in 2024. That is the amount per person. Remember that for a married couple, each spouse gets a $13.61 million lifetime exemption, and any unused amount is portable to the surviving spouse, meaning if a spouse dies and has not used any of their lifetime exemption amounts, the surviving spouse's exemption amount would double to $27.22 million in 2024. Below are a few estate planning strategies you can utilize to help higher-net-worth families transfer their wealth more efficiently.