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your $ A magazine from WEA Member Benefits

WINTER

2015-16

PROTECT

WHAT’S IMPORTANT

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your retirement The role of Roth savings

your finances

Get your plan on in 2016

your kiosk

Uber insurance issues Take the match…always A hat trick of tax breaks


your $ {

Get your plan on in 2016.

CONTENTS WINTER 2015-16

3 YOUR ACCOUNT

- The 2016 Prudential Guaranteed Investment credited rate is 3.80%. - Tax documents coming soon. - Important announcement about beneficiaries and marital property. - Online 403(b) resource tool launched.

4 YOUR RETIREMENT

- Learn the benefits of a Roth IRA and why you might want to include it in your savings strategy.

6 YOUR INSURANCE

- What you don’t know may prevent you from protecting what you value most.

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8 YOUR FINANCES

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- Make 2016 the year of the plan. Help awaits you at Member Benefits.

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10 YOUR KIOSK

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- Don’t miss out on free money. - Get a triple tax break on your longterm care insurance premiums.

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- Uber drivers may be taking a big risk.

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president’s letter Dave Kijek, President/CEO, WEA Member Benefits

Follow us. © 2016 WEA Member Benefit Trust. All rights reserved.

2015 achievements set a high bar for 2016. Challenge accepted.

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Happy New Year! Months before the new year arrived, Member Benefits began planning for it. We asked and answered questions like: What are our goals and objectives for 2016? What big projects should we take on? How much will it cost? And, most importantly, how will members benefit from our plan decisions? It’s an exciting exercise—to look forward and dream about what we might achieve. It’s equally exciting to reflect back on where we’ve been, acknowledging

accomplishments of the last 12 months and feeling confident in where we are at before charging ahead. At Member Benefits, 2015 was a great year. We helped more Wisconsin public school employees on their financial journey than any previous year and we welcomed nearly 6,000 new members into our programs—programs designed to help members plan, build, and protect their future financial security. In 2015: • Approximately 600 Wisconsin public school employees utilized our free and fee-based financial planning services. • More than 3,500 started building their nest egg with our IRA or 403(b)— in which member assets exceeded $3.5 billion in 2015.

• Thousands of Wisconsin public school employees received unbiased insurance consultations that made them better consumers and exposed potential financial risks (page 6). Yes, it was a fine year for serving members, but we’re not satisfied. With our 2016 plan in place, work has already begun to surpass our 2015 accomplishments and deliver even greater value to our members. As you continue your financial journey in 2016, let us help you stay on track. We are your trusted resource and advisor, and your biggest cheerleader. Your success is our success. Best regards, weabenefits.com


{ your account IRA and 403(b) news 2016 Prudential Guaranteed Investment rate is 3.80%*

WEA Member Benefits™ is pleased to announce that the 2016 Prudential Guaranteed Investment credited annual rate of return for both the WEA TSA Trust and WEAC IRA programs will be 3.80%. The Prudential fact sheet and a Q&A regarding the current Prudential Guaranteed Investment contract is available online at weabenefits.com/pru.

Watch for your 1099-R

If you took a reportable distribution from your WEA TSA Trust 403(b) and/ or WEAC IRA account(s) during 2015, we will send a 1099-R to the address on file on or before January 31, 2016. You will receive your 1099-R from our custodian, Mid Atlantic Trust Company.

Contribution limits remain unchanged

Annual contribution limits for the 403(b) and IRA retirement savings plans remain unchanged from last year. The 2016 limit for the 403(b) is $18,000 and the age 50 and over catch-up is $6,000. For the IRA, the $5,500 limit remains the same for the fourth year in a row, with the age 50 and over catch-up limit an additional $1,000 for a total of $6,500.

Important retirement information coming in the mail

If you have an IRA with Member Benefits, expect a letter from us to remind you to name your beneficiaries if you haven’t already. It’s also important to review your beneficiaries from time to time, especially when your circumstances change. Remember: The beneficiaries on your retirement account supercede what you may have in your will. The content in this magazine is for informational purposes only and is not intended to constitute legal, financial, or tax advice. Certain recommendations or guidelines may not be appropriate for everyone. Consult your personal advisor or attorney for advice specific to your unique circumstances before taking action. The 403(b) retirement program is offered by the WEA TSA Trust. TSA program registered representatives are licensed through WEA Investment Services, Inc., member FINRA. The Trustee Custodian for the WEAC IRA accounts is Verisight Trust Company. *Interest is compounded daily to produce the current annual yield prior to the deduction of program administrative fees. Contributions and earnings are held in the general account of Prudential Retirement Insurance and Annuity Company (PRIAC). Principal and net credited interest are fully guaranteed by PRIAC. Such guarantees are based solely upon the financial strength and claims-paying ability of PRIAC. For more information go to weabenefits.com/pru.

{ WHAT’S ON YOUR MIND? Do you have a story to tell, a question, or an article suggestion? Send an e-mail to memberbenefits@weabenefits.com. Type “your$” into the subject line. weabenefits.com

You can stick with us Did you know that you can stay insured with us even after you leave your school job or retire? That includes any of our property and casualty insurance products: auto, home, condo/renters, umbrella, and flood. Also, children of currently insured members may qualify for our insurance if they start a policy before turning 25 or within six months of leaving their parents’ policy if they are over 25 years old. Give us a call at 1-800-279-4010 to learn more or ask questions.

Retirement, too!

Your Member Benefits’ 403(b) and IRA accounts can remain with us whether you retire, change districts, or change professions. And if you continue participating in one of those programs, you are also eligible for our financial planning services or insurance programs (as long as you meet program requirements). For more information on our retirement programs, call 1-800-279-4030. Eligibility and underwriting requirements apply.

Member Benefits’ 403(b) enrollment booklet is now online Want to learn more about saving for retirement with Your 403( a 403(b) account? b) Enrollm ent Book let The contents of our 403(b) enrollment booklet are now on our Web site for easy access and perusal. Many people have found our booklet to be a great source of information about the basics of saving and investing, as well as how a 403(b) account can help you reach your goals. It has also been used as a teaching tool and resource by school employees who lead informal financial mentoring groups at their school. Explore different sections of content for information about saving and investing, find forms and links to resources, get a full PDF copy of the booklet, and enroll online at weabenefits.com/enroll403b. WEA TSA

Trust Pr ogram

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{ your retirement

To Roth or not to Roth in your IRA That is the question…but the Roth savings option is often as misunderstood by people as Shakespeare. Get to know some of the benefits and considerations of the Roth so that ‘thee can maketh an informed own choice.’

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s a Wisconsin public school employee, maybe you’ve heard the story of the three legged stool that illustrates the need to save for retirement. One leg is the Wisconsin Retirement System, the second is Social Security, and the third is personal savings. Imagine trying to sit on that stool without all the legs. It will be difficult and you’ll be struggling…a real tragedy. So it’s important to have personal savings to supplement your retirement. One option is a Traditional or Roth IRA. But when it comes to choosing between the two, few people understand the differences or the unique characteristics of the Roth. The Roth isn’t just for younger folks... it offers benefits to people of all ages.

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Learneth more about the Roth IRA As long as you don’t exceed the income provisions and have earned income, you may qualify for the Roth IRA. The Roth can help you balance your retirement plan by controlling your tax liability when you retire. It also includes many other benefits, some of which you may not be aware of. The main difference between a Traditional and a Roth IRA is when taxes are paid. In a Roth, money going into your account is after tax so that your future qualified withdrawals, including earnings, are tax free in retirement (assuming the Roth IRA has been open for at least five tax-years and you’re older than age 59½). One way to think about it is that the Roth offers tax-exempt savings (you’ve prepaid the taxes so later qualified withdrawals are tax free) while the Traditional IRA offers tax-deferred savings (interest accumulates tax free until you make withdrawals, which are then treated as taxable income). Regardless of the type of IRA, contributions for 2016 cannot be more than $5,500, or $6,500 if you’re age 50 or older, or your taxable compensation for the year if it was less than this dollar limit. Contributions can be made up to the tax filing deadline (you have until April 15, 2016, to make a 2015 contribution).

Valorous reasons to consider the Roth

‘Tis wise to consider a Roth IRA as there are a number of potential benefits from investing in one. Flexibility • If you want to make withdrawals before you retire, you can tap your contributions (not your earnings) at any time—tax and penalty free. • Roth money, including earnings and up to a lifetime IRA maximum of $10,000, may be used toward a first home after you’ve had the account for five years. You may also qualify for penalty-free withdrawals on assets earmarked for college expenses for yourself, your spouse, your children or grandchildren (great grandchildren, too!). Note: Taxes may apply to earnings withdrawn for this purpose. • While the Roth IRA is designed for long-term savings, distributions can be taken tax- and penalty-free, provided the account is five years old, if you are over 59 ½, or in case of disability or death, making it more flexible than other retirement savings accounts. • The Roth is portable. Changing jobs doesn’t affect account status or require changes. Accessibility • Folks of any age can contribute to a Roth IRA as long as they have earned weabenefits.com


income from a job…so even a teenager with part-time work can start saving early in life and really benefit from compound interest. • If you open a Roth through Member Benefits, your family members may also qualify to open an account.* No required minimum distributions and continuous saving • Unlike a Traditional IRA, the Roth has no required minimum withdrawals at age 70½. This allows your account balance to continue growing for as long as you like. • You can also continue to contribute to the Roth IRA after age 70½ as long as you are working. Benefit thine heirs • You can pass on your Roth funds after you die and your heirs will still receive distributions in the same tax-free way you would have. • In addition, if your beneficiary chooses to “stretch” your Roth IRA across generations, those distributions are generally not taxable.

Thou has’t low fees and resources with Member Benefits

With Member Benefits, you can take advantage of: • Low annual administrative fees (0.45%) and annual fee cap of $600 for WEAC members or $750 for nonmembers.** • Calculators on Roth IRA contributions, conversions, and comparisons to the Traditional IRA. Visit weabenefits.com/ calc. • Free one-hour financial consultation to evaluate your savings options and set goals. • Articles and blog posts on retirement savings topics of interest.

“To thine own self be true”

Only you can decide which savings option is best for you. Much depends on what you believe your tax bracket will be in the future and whether the deduction is worth more today than tax-free income in the future. Uncertainty on future tax rates and policies may further complicate the decision. Our financial planners can help guide you to make an informed decision. Just make an appointment by calling 1-800-279-4030. The best way to avoid a tragedy? Regardless of the plan you choose, get started now! Shakespeare’s King Lear may not have known about IRA plans, but his famous line could apply to not saving for retirement: “Nothing will come of nothing.”

It’s easy • Whether you choose the Roth or Traditional IRA, it’s easy to take advantage of dollar cost averaging, which is purchasing a fixed dollar amount at regular intervals over a long period of time. Setting up automatic contributions from your checking or savings account, or using payroll deduction if your school allows, makes it simple to do and keeps you on track.

Some things to ponder

It is possible to make too much money to open a Roth IRA. Income limits can change annually, so check irs.gov for the latest updates. But if you already have a Roth and your single or joint income exceeds the limits, don’t worry…you won’t have to liquidate it, you just won’t be able to make additional contributions. Secondly, while the Roth gives you tax flexibility in retirement, it does not lower your taxable income today like the Traditional (pre-tax) IRA. This article is for informational purposes only and is not intended to constitute legal, financial, or tax advice. Consult your tax advisor or attorney for advice specific to your unique circumstances before taking action. *Wisconsin residency required. **Minimum annual fee of $25 for inactive accounts. Inactive accounts are accounts with no contributions. The Trustee Custodian for the WEAC IRA accounts is Verisight Trust Company.

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{ your insurance

PROTECTING WHAT’S IMPORTANT These facts and scenarios can help you understand the risks so you can protect those you love, the things you’ve worked hard for, and the security you’ve built for your family.

3 minutes to escape

Picture your home on fire. How much time do you have to get out? Thirty years ago, you and your family would’ve had roughly 17 minutes. Today you may only have three or four. The reason? Modern homes are fueling faster fires and producing smoke that is more lethal than three decades ago. • Larger homes with open floor plans allow fires to spread with fewer barriers. The open spaces accelerate fires by allowing for faster airflow and more oxygen. • Homes have more synthetic materials than they did thirty years ago. Newer furniture, carpet, and clothing contain fastburning substances.

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• The oils and derivatives from common synthetics, such as polyurethane and reconstituted soda bottles, produce toxins such as hydrogen cyanide, phosgene, and carbon monoxide. The National Fire Protection Association says most fatalities from fire are caused by smoke inhalation, not burns. Preventative measures, starting with a working smoke alarm and a wellrehearsed escape plan, will maximize every second and can be the difference between life and death. And be sure you have enough insurance coverage to replace your home and personal belongings. A Member Benefits personal insurance consultant can help you evaluate your current coverage and calculate replacement cost to make sure your biggest investment is protected.

Q. A.

If I lend my car to a friend and the friend has an accident, whose insurance covers the damage? Yours. Lend your car. Lend your insurance.

a word to the wise renter:

INSURANCE Your personal possessions (your clothes, furniture, electronics, etc.) are not covered under your landlord’s insurance policy. Your landlord’s policy only covers your landlord’s property, not yours. Renters insurance provides protection for your personal property, such as clothes, furniture, computer, entertainment system, microwave, etc., in case of perils like fire or theft. Additionally, renters insurance provides liability protection against accidental occurrences in your apartment (such as someone slipping on a wet floor and breaking an arm) or off premises (such as causing injury to someone during a pickup basketball game) in case you are found liable to others as a result. Renters insurance is a very affordable way to protect your belongings. The typical renters premium runs about $70–80 per year. weabenefits.com


TRUE STORY

Call 1-800-279-4010 for a free insurance consultation.

A member calls Member Benefits. He has been in an accident while riding with a friend. The member sustained head trauma as a result of the accident and spent three days in the intensive care unit and expects to miss at least two weeks of work. Problem: His friend is underinsured. His insurance policy only had liability coverage of $25K per person/$50K per accident (state required minimums) and $10K of medical coverage. This means there is only $35K worth of coverage to pay our member’s expenses, which easily exceeded that amount. Solution: Fortunately, our member included $250K worth of Uninsured Motorist/Underinsured Motorist (UM/ UIM) coverage in his own auto policy with Member Benefits.* Without this coverage to fall back on, he may have been forced to sue the friend to recover any medical bills, pain and suffering, or lost wages. UM/UIM coverage covers situations including: • Bodily injury that you, your family, and other occupants of your vehicle incur when hit by an uninsured or underinsured motorist or hit-and-run driver. • You and your family if injured as a pedestrian when struck by an uninsured motorist or hit-and-run driver. UM/UIM coverage also covers: • Lost wages • Medical costs • Rental car • Property damages • Pain and suffering • Emotional distress • Future wages if your career is negatively impacted because of the accident * The $250k policy limit would be reduced by the amount covered by the policy of the underinsured driver.

TAKE THE PLEDGE Distracted driving kills and injures thousands of people each year. • At any given daylight moment, 660,000 U.S. drivers are using their phone while driving. • 1 out of 4 teens responds to at least one text message EVERY TIME they drive. • 9 Americans are killed every day due to distracted driving. • 10% of parents admit to having multi-message text conversations while driving.

• Texting drivers take their eyes off the road an average of 4.6 seconds, which at 55 mph means they drive the length of a football field without looking. (Source: CQ Researcher.) Visit distraction.gov and stoptextsstopwrecks.org for videos, statistics, and a pledge form to not text and drive. (Warning: Some videos are very graphic.)

I pledge to: b Protect lives by never texting or talking on the phone while driving. b Be a good passenger and speak out if the driver in my car is distracted. b Encourage my friends and family to drive phone free. Continued on page 9: “Gadget Mishaps Happen”

This article is for informational purposes only and is not intended to constitute legal, financial, or tax advice. Certain recommendations or guidelines may not be appropriate for everyone. Consult your personal advisor or attorney for advice specific to your unique circumstances before taking action. Property and casualty insurance programs are underwritten by WEA Property & Casualty Insurance Company. The terms and conditions of your coverage are exclusively controlled by your written policy. Please refer to your policy for details. Certain policy exclusions and limitations may apply.

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{ your finances { yourfinances

Get your plan on in 2016

Financial planning is a career-long process—a journey. It starts your first day on the job. Every financial decision you make (or don’t make) along the way can impact when you will reach your final destination and what it will look like when you arrive. If you don’t have a plan, make 2016 the year you get it done. You don’t have to be an expert in finances or investing to do well financially, but having a plan is essential. Our financial planners can help tailor a plan to suit your goals and your situation regardless of where you are at on your journey. Our financial planning services are designed for the education community and can help get you on track and keep you on track toward financial security.

Just starting out Free One-Hour Consultation The free consultation is great for Wisconsin public school employees just starting their careers, starting to plan, or looking for a quick plan checkup. Just one hour can help you get started down the road to financial security. Our planners will help you: • Understand and determine an appropriate asset allocation. • Evaluate your retirement savings account options. • Calculate savings goals. Bonus: You can take advantage of the free one-hour consultation one time per year.

Building your assets

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Portfolio Analysis If you have started saving and have investments but are wondering whether you are invested appropriately for your age, life stage, and risk profile, a Portfolio Analysis might be appropriate. You’ll receive a comprehensive evaluation of your current investment portfolio (including investments you or your spouse may have with other companies) and recommendation of adjustments needed to align your portfolio with your financial goals, risk tolerance, and investment objectives. This fee-based service includes two hours of analysis and a 30-minute consultation to deliver the report.

Cost: As low as $350 Participants in our 403(b) program get a 50% discount off the full price of $700.

Wondering if you’re on track for retirement Retirement Income Projection If you are 11+ years from retirement and are wondering if you’re on track to meet your retirement goals, the Retirement Income Projection may be just what you need. You will play an active role in gathering specific data and other details necessary for the projection. The Income Projection provides you with: • A comprehensive view of your retirement expenses and income. • An estimate of your Wisconsin Retirement System (WRS) pension benefit based on the annuity option and retirement date that you choose. • Your Social Security benefit estimate, and more. The Retirement Income Projection is a fee-based service and includes three hours of analysis and a 30-minute consultation to deliver the report.

• A retirement income distribution cash flow analysis. • A tax analysis to help you understand and anticipate your future income tax liability, and more. Cost: As low as $950 Participants in our 403(b) program get a 50% discount off the full price of $1,900. WEAC members receive an additional discount up to $150.

“Meeting with Brenda brought us such a level of comfort. It gave us a real peace of mind knowing that we’re on track and able to maintain our lifestyle. The plan was very thorough—it gave us a budget, when we should take Social Security, and even a timeline to buy our next car—it was really beneficial.”

Retired educators Nick and Karen Niehausen (Kettle Moraine and North Lake).

Cost: As low as $250 Participants in our 403(b) program get a 50% discount off the full price of $500.

Planning your retirement Retirement Income Analysis For those within 10 years of retirement, this highly focused, fee-based plan will give you the answers you seek about your readiness to retire. This comprehensive analysis will provide: • Strategies for preserving your retirement assets. • Suggested adjustments to meet your goals. • An estimate of your WRS benefit and Social Security benefit. weabenefits.com weabenefits.com


Continued from page 7: “Protecting What’s Important”

Meet our planners

Our financial planners specialize in working with Wisconsin public school employees. They put the members’ best interests first. There are no commissions attached to our financial planning services, so you receive an unbiased analysis of your situation. Brenda Echeverria Financial Planner “Education is close to my heart. Several of my family members are educators. As a financial planner, I educate members about their unique financial situations and help them create a plan so they can realize the retirement lifestyle they desire and deserve.” Brenda has worked in financial services for over 25 years, and has been with Member Benefits since 2008. She is a Chartered Retirement Planning Counselor and holds several securities licenses including series 6, 7, 63, 65, and life and health insurance licenses. A graduate from the University of Connecticut with a Bachelor’s in Finance, Brenda is currently a Certified Financial Planner® candidate working on a Master’s in Financial Planning.

Eric Schwartz Financial Planning Specialist “I enjoy meeting with members and helping them identify where they want to go and coming up with a plan to get them there.“ Eric has been with Member Benefits for nearly four years and has held various roles within the organization. He graduated from the University of Wisconsin-Madison with a bachelor’s degree in Personal Finance and a Business Certificate and holds securities licenses 6, 63, and 65, and a Wisconsin life insurance license. Eric is also a candidate for the Certified Financial Planner® designation.

Plan ahead!

Schedule your 2016 consultation with one of our financial planners. Appointments are first-come, first-served and they fill up fast!

GADGET MISHAPS HAPPEN Did you or your kids get a new gadget over the holidays? While you can’t cover every possible risk, you do have choices in how you can protect those significant investments. Here are some to consider. u Extended warranty. This coverage, pushed at the point of purchase, typically covers only product defects or malfunctions. According to Consumer Reports, most issues that would qualify tend to happen during the initial warranty period, making the extended coverage essentially worthless. So, taking a pass on this might be for the best. u Scheduling. Protect against theft, loss, or mysterious disappearance by scheduling your gadgets, jewelry, and other valuable items on your homeowners or renters policy for a few dollars a month. Deductibles do not apply to scheduled items. u SquareTrade or similar plans. These types of protection plans cover all of your electronic devices for accidents like drops and spills, plus common malfunctions. However, deductibles apply. u Credit card coverages. If you make major purchases with a credit card, you may have a purchase protection benefit. Coverage varies by card and by individual situation. Before purchasing additional coverage, check out protection already available through your credit card.

Appointments available in: -Brookfield -Eau Claire -Green Bay -Madison -Stevens Point

For more info, visit weabenefits.com/financialplanning, call 1-800-279-4030, or e-mail weafa@weabenefits.com. Registered representatives of WEA Investment Services, Inc., member FINRA. Registered investment advisor agents of and investment advisory services offered through WEA Financial Advisors, Inc. Fees and services subject to change.

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{ your kiosk

UBER ISSUES Familiar with the new age taxi/ride sharing services like Uber or Lyft? They are part of a Transportation Network Company (TNC) that uses a digital network to connect passengers to participating drivers for a fee. Anyone who wants to use their own vehicle can tap into the network and start making money by driving people to their destination. While the ride-sharing model has legions of fans, it has come under scrutiny for issues related to passenger and driver safety, not the least of which is related to inadequate insurance.

Here’s the problem

While Uber, Lyft and other ridesharing services bumped up their liability

insurance this summer in response to new laws going into effect in many states, coverage is limited to liability—damage to others. So, drivers may still be uncovered for collision or damages to their car. Also, drivers themselves may not be protected if they are hurt in an accident that they cause.

Don’t be surprised

Don’t mistakenly think that your personal auto policy will fill in the gaps because most policies contain standard exclusions to limit exposures related to the commercial use of a vehicle. So, if you decide to make extra cash as a driver for Uber or the like, make sure to review your

current policy to avoid any surprises in the event of an incident. If you have a personal auto policy with Member Benefits note that your policy does not extend to commercial use. Your liability, medical payments, and uninsured and underinsured motorists coverages will not apply during any time you are logged into a TNC like Uber. Give us a call at 1-800-279-4010 for more information and help getting appropriate coverage. Property and casualty insurance programs are underwritten by WEA Property & Casualty Insurance Company. The terms and conditions of your coverage are exclusively controlled by your written policy. Please refer to your policy for details.

TAKE THE MATCH

IT’S THE EASIEST MONEY YOU’LL EVER MAKE If your employer (or your spouse’s employer) offers a match in your 403(b) or 401k plan, take it. It’s free money. While matching contributions have been popular in the private sector for years, it is a rather new trend in benefits offered by Wisconsin public schools. More and more districts are now offering a match to incent staff to save for retirement and also to make their employee benefit package more attractive to potential recruits and veteran staff.

How it works The match will vary from employer to employer. It might be 50 cents to a dollar for every dollar you contribute, up to a set maximum—perhaps 3% to 6% of your salary, or in some cases a dollar limit. Matching funds usually vest over time— meaning the matched funds aren’t all yours until you’ve completed the vesting period—typically 3 to 5 years. Once

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you’re fully vested, you can take the entire employer match with you should you part ways. However, if you leave before you’re fully vested, you may get to keep only a portion of the match or maybe none at all. It depends on the employer plan. But, all the money you contributed is still yours.

$1,336

The average amount of employer match employees missed out on in 2014.

$42,855

The average amount of employer match an employee will miss out on over the span of 20 years.

$1.4B

The total amount of unclaimed employer matching contributions, according to the survey of over 1 million employees.

$24B

The annual amount of lost employer matching contributions due to employees not saving enough.

Take the money Ironically, this benefit is underutilized and many employees are leaving money on the table.With continued changes to postemployment benefit packages in both the private and public sectors, employees will need to rely more on personal savings to fund retirement. Do it the easy way. Never pass up the opportunity to get free money from a match. An added bonus: The match effectively increases your income without increasing your tax bill, since you pay no taxes on matching contributions until you withdraw them in retirement.

Source: Financial Engines™

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HSA Tax-Break Hat Trick

Hit it between the pipes by using your health savings account (HSA) to save on long-term care insurance (LTCi) premiums You may already know that one of the “top shelf ” products Member Benefits offers to Wisconsin public school employees is individual long-term care insurance (iLTC). Our partner, LTCi Marketing Administrators, offers policies that allow you to receive the care you need at home, in an assisted living facility, nursing home, or memory care facility—services not covered by Medicare or health insurance. But did you know that you may be able to save money on your iLTC premiums by paying with funds from a Health Savings Account (HSA)? If you have a high deductible health plan, you probably have an HSA, which is a tax-advantaged health savings account. And having an HSA may give you a hat trick of tax savings. Kiplinger’s Personal Finance describes an HSA as a powerful savings tool because “an HSA gives you a triple tax break:” • Contributions are sheltered from income taxes. • The money grows tax-deferred. • The funds can be withdrawn tax-free for medical expenses. The adjacent “scoreboard” illustrates how an HSA can be used to save money on your iLTC premiums.

Get in the game

In 2016, individuals with HSAs can contribute up to $3,350 if they have individual health coverage or $6,750 if they have family coverage. Those age 55 or

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older can contribute an additional $1,000. According to the Internal Revenue Service, distributions from HSAs can help pay for a variety of medical expenses including “qualified long-term care services and premiums paid for qualified long-term care insurance contracts.” Health Reimbursement Accounts (HRAs) may also be used to pay for iLTC premiums but only if the district defines iLTC premiums as an eligible expense. There are also state and federal tax reductions available for employees, their spouses, and dependents. Consult with your employer or tax professional for more information.

Light the lamp!

Score your goal by getting more information about the iLTC insurance program sponsored by WEA Member Benefits. The earlier you purchase iLTC coverage, the lower the premiums because your age is a major consideration in determining your rate.

888-247-5905 wealtc.membersplan.org

This is general information only. Members should consult their tax accountant or attorney for detailed advice regarding their particular tax or financial situation. Long-term care (LTC) insurance products are underwritten by multiple LTC insurers. Program administered by LTCi Marketing Administrators Inc. (LiMA).

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PO Box 7893, Madison, WI 53707-7893

$aving is a family thing. Your teen can start contributing to our Roth IRA as long as they have a job. See what just $20 a month could do to secure your child’s future.

Copyright © Council for Economic Education. All rights reserved. This is for illustrative purposes only. No guarantees are expressed or implied. Results will vary based upon actual return realized. Fees apply.

Your family—including your spouse, children, grandchildren, parents, and parents-in-law—may participate in the WEAC IRA program.*

Enroll online: weabenefits.com/enroll Call us: 1-800-279-4030 The Trustee Custodian for the WEAC IRA accounts is Verisight Trust Company. *To be eligible for this program, you must meet the IRS eligibility requirements for contributing to an IRA. Wisconsin residency required.


Your$ Magazine -- Winter 2016