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HSAs and FSAs

Health insurance plans, tax code and government-sponsored programs are often written in complicated language, making it a challenge to understand all of the benefit options available to you. Health Savings Accounts (HSAs) and Flexible Spending Arrangements (FSAs) are similar tax-saving ways to help pay for qualified medical expenses.  However, each comes with its own set of rules.

A health savings account (HSA), is a tax-advantaged account set up through a qualified trustee (bank, insurance company, etc.) to pay or reimburse qualified out of pocket medical expenses. Simple sounding, HSAs have some specific requirements starting with who is eligible to sign up for a HSA.

To qualify for an HSA, you must:

• Be covered under a qualified high-deductible health plan (HDHP).

A HDHP has a minimum annual deductible higher than a typical health insurance plan.

For 2017, the minimum annual deductible is $1,300 for individuals and $2,600 for families with a maximum cap of $6,550 and $13,100 for individual and family out of pocket medical expenses respectively.

For 2018, the minimum annual deductible increases to $1,350 for individuals and $2,700 for families. The caps on annual out of pocket medical expenses increase to $6,650 for individuals and $13,300 for families.

• Not have any other healthcare coverage unless already covered by liabilities incurred under workers’ compensation laws, torts (civil legal liability), or ownership or use of property, a specific disease, or a fixed amount per day (or period) of hospitalization

• Not be enrolled in Medicare

• Not claimed as a dependent on someone else’s current tax return

Benefits of opening an HSA account include the following:

• Contributions made by anyone other than an individual’s employer are tax deductible and do not need to be itemized on Tax Form 1040.

• Contributions made on the behalf of an individual’s employer may be excluded from an individual’s gross income.

• The HSA balance rolls over from year to year.

• The interest and gains on the assets in the account are tax-free, and distributions remain tax-free if paying for qualified medical expenses. At age 65, distributions may be taken for any reason without penalty.

• HSA funds remain available for future qualified medical expenses even if the individual changes health insurance plans, changes employers, or retires.

Individuals with a qualified high deductible health plan are eligible to contribute up to $3,400 a year in 2017, compared to family HDHP coverage which allows for up to $6,750 in annual contributions. In 2018, those amounts increase to $3,450 and $6,900 respectively. Individuals who are 55 or older are eligible to contribute an additional $1,000 each tax year. Employers have the opportunity to contribute to HSAs, but the annual limits still apply and include amounts contributed through a cafeteria plan.

Qualified expenses to use funds from an HSA include medical, dental, vision, and prescription expenses not covered by medical insurance. These do not include insurance premiums except in certain cases including paying for COBRA and paying for medical premiums if unemployed.

In comparison, some individuals may have the option to enroll in a Flexible Spending Arrangement (FSA). FSAs have many similarities to HSAs in their structure and use of funds, but have many differences that are important to understand.

A health Flexible Spending Arrangement (FSA) is a tax-favored program that allows employees to pay for out of pocket medical expenses with pre-tax dollars. In order to qualify for an FSA one must be employed by an employer who offers the FSA program as part of its cafeteria plan coverage

Once enrolled in a FSA, the employee must choose an amount of their salary to pledge to the account by estimating how much he or she thinks will be spent during the period on copayments, drugs and other qualified expenses not covered by insurance. Each pay period, an equal proportion of this contribution will be taken out of an individual’s income pre-tax.

Benefits of enrolling in a FSA include the following:

• Because contributions to the account are made through a cafeteria plan, they are not subject to income and other payroll taxes, such as Social Security and Medicare.

• The employer may allow the annual contribution amount to be available at the beginning of the plan year, which would allow an employee to claim the entire annual amount at the beginning of the year if he or she has qualifying expenses.

In 2017, employees are eligible to deposit up to $2,600 in an account each year, subject to the employer’s plan limitation. The contribution limit is expected to remain the same for 2018.

FSAs are “Use it or lose it”: Any money left in an FSA at the end of the plan period is forgone by the owner of the account.  Some plans have a grace period after the year is over to deplete the remaining balance of the FSA.

For more information about HSAs and FSAs plus a list of qualifying medical expenses, contact your accountant, plan administrator or go to IRS Publication 969.

Hikes We Like

We were visiting family in Albuquerque recently and in between family time and green chile we were able to squeeze in a hike at Kasha-Katuwe Tent Rocks National Monument.

Kasha-Katuwe is a Keresan phrase meaning “white cliffs”, Keres being the traditional language of the pueblo tribes of northern New Mexico. The cone shaped tent rocks were formed by volcanic eruptions that occurred 6-7 million years ago and left pumice, ash and tuff deposits over 1,000 feet thick. Over time, weathering and erosion of these layers created canyons and the unique rock formations which vary in height from several feet up to 90 feet.

The trail took us through some tight slots in the canyon.

Our All Trails app indicated that Cave Loop and Slot Canyon Trail would be about 3.1 miles, but in the end we tracked just over 4 miles so we must have strayed off the trail at some point. Overall the hike had minimal elevation, beautiful pinyon pines dotting the landscape, canyon walls rising up above on both sides, leading through the slot canyon and the climb to the mesa top.

Luckily we hiked on a weekday and missed the weekend crowds, so had time to reward ourselves with a stop at La Cumbre one of our favorite Albuquerque breweries.

Identity Protection

Unfortunately recent news has identity theft at the top of all of our minds, again. We have researched a bit more on the topic and have the following suggestionsCheck your credit report at least 3 times a year at

  1. Consider signing up for a credit monitoring service. The service should monitor all three credit bureaus, should notify you immediately of anything suspicious. The cost should be between $10-25 a month depending on the coverage you would like. We found this article to be helpful in deciding which service to use.
  2. Consider placing a freeze on your credit, this will require anyone who is trying to open accounts in your name (yourself included) to have your PIN or password to allow access. This costs between $5-10 and needs to be done with each credit agency. More information on this can be found here
  3. Shred everything and consider using a ‘Security Micro Cut Shredder.’
  4. Use your credit card and not your debit card whenever you can. By federal statute, you have no liability if someone makes fraudulent charges on your credit card.
  5. Check your bank and credit card statements each month for any illegitimate charges.
  6. Be careful who you do business with online and have at least two passwords –one for banking/investments and another for shopping. This will keep your banking and investments passwords safer if there is another retail breach. It is important to change your passwords frequently.
  7. Activate 2-factor authentication on accounts that will send you a text when you log in on an unauthorized device.

A little investment of time and vigilance over your financial affairs can reap great returns by saving you money and significant headaches.

Please contact us with questions or concerns!

Weekend at Vermejo Ranch

Earlier this summer we were invited by friends to join them at one of Ted Turner’s ranches for a long weekend. Vermejo Ranch is comprised of 585,000 acres in northeast New Mexico with part of the ranch overlapping into the Sangre de Christo mountains of southern Colorado.  I had heard of Ted Turner before arriving but was unfamiliar with his interesting philosophical mix of conservation versus economic development in his ranches.

Vermejo Park is a working ranch with a large (2,000+) bison population (birthplace of CU’s mascot Ralphie V) as well as a guest ranch destination for fishing and sport shooting. Natural gas is still produced on the ranch with strict environmental controls and at one time coal was also mined.  The ranch is also actively participating with the US Fish and Wildlife Service in attempts to establish a population of the endangered black footed ferrets on the ranch prairie lands and they are also working to conserve the Rio Grande cutthroat trout which is currently only found in 10% of its former range.

AND in spite of all the economic and conservation activity going on around us we managed to have a great time. We fly fished, rode horses, sat on the porch drinking wine, etc.  I shot a gun for the first time ever with laughable results.  I did finally manage to hit a large box that was lying very still on the ground not too far from me.  I also managed to wound a fake, styrofoam elk with a bow and arrow.  A real elk would never have let me get as close as I had to get to actually hit the fake elk and, in fact, I have no interest in actually hitting a real elk but maybe next time I’ll take a step or two back and see if I can still hit the fake one.


Hikes We Like

by Annika Spetnagel  – Harbor Intern

Having worked at an athletic club and as a nanny the two previous summers, my summer internship at Harbor marked my first “real job”. This summer has been a fantastic learning experience and I’ve really enjoyed my time here at Harbor, but the one thing I missed from previous summer jobs was the ability to spend the day outside enjoying my favorite season’s weather. Luckily, spending the day inside motivated me to really take advantage of the weekends and opt outside.

I love to hike and I was lucky enough to grow up in Colorado; a hiker’s paradise. My first hike of the summer took place at Coyote Ridge just outside of Fort Collins. I’d driven by the trailhead numerous times and swore I would get around to hiking it one of these days. Finally, in early June, my opportunity arose. The hike itself was a quick 4 mile round trip that started off level and got a bit harder as you reached the ridge. Along the way I had a great view of open plains and traditional Colorado scenery, which was enough to distract me from the numerous signs warning of rattlesnakes in the area. As pretty as the views were on the way up, the view at the top of the ridge (pictured below) definitely took the cake. Bonus points if you can spot me in one of the pictures.


I ventured to Rocky Mountain National Park for my second hike of the summer, with the goal of hiking to Emerald Lake. After completing the hike, my roommates and I agreed this hike definitely gives you your bang for your buck. Along the way to Emerald Lake, hikers pass three other gorgeous lakes and a multitude of stunning views. The hike, only 3.8 miles round trip, is easy and enjoyable, and a great hike for families.

I took this picture (bottom left) at Bear Lake, which marks the very beginning of the hike, just 5 months before in February. It made a fun side by side comparison, and reminded my how grateful I am for the warm weather.






Pictured below is the second lake along the hike, Nymph Lake, as well as a picture of one of the gorgeous viewpoints along the way.







My roommates and I posing in front of Dream Lake, the last stop before the aptly named Emerald Lake.













Elyse Quoted in WSJ

Elyse Foster, CFP® was recently quoted in The Wall Street Journal’s article “Talk Is Cheap: Automation Takes Aim at Financial Advisers – and Their Fees”

The Wall Street Journal explores advisory compensation by exploring fees for asset management and planning. The article addresses the question- Are robo advisors and other low cost platforms putting pressure on industry fees?

Harbor’s stance is to be proactive on lowering fees to stay ahead of the industry and continue to put client’s needs first.

We have shared the article in full on Harbor Financial Group’s Facebook page.  Click here to read the article: Talk Is Cheap: Automation Takes Aim at Financial Advisers-and Their Fees

Also, if you are not already following Harbor on Facebook, please do!

Investopedia: What’s the Minimum I Need to Retire?

Can you retire with $1 million dollars?  Now that’s quite a question. Many professionals boil this down to a 4% sustainable withdrawal rate known as the holy grail of retirement analysis. Writing for Investopedia, Jason Whitby consulted with several wealth management professionals including Elyse Foster, CFP® of Harbor Financial Group and found not everyone agrees that this withdrawal rate is sustainable in today’s financial environment.

“If you want to retire with $1 million, it is going to come down to a combination of: 1) how you define retirement; 2) your personal inventory of everything in your life, such as assets, debts, medical, family; and 3) what the future holds.

Remember, stuff happens in life. Do you really want to start this 30-plus year adventure with the bare minimum? Like most good things, retirement is much better when you are over-prepared than when you wing it. You can retire with $1 million dollars, but it’s better to be safe than sorry – shoot for $2 million!” – Jason Whitby, Investopedia

Full Article: What’s The Minimum I Need To Retire?

Original Source: Investopedia, Jason Whitby, May 4, 2017, What’s The Minimum I Need To Retire?

Hikes We Like

Another 14’er checked off the list.  Quandary Peak in Summit County is the highest summit of the Tenmile Range with an elevation of 14,265 feet.  We chose to hike the East Ridge route as it is the easiest (but the longest at 6.75 miles).  This is our 8th 14’er and possibly the prettiest.

To beat the rush (and to find parking) we got an early start at 5:30am. The first hour or so were in the woods, but the trail quickly became steeper and we were soon above treeline.


















We encountered many mountain goats who didn’t seem to mind being photographed.












It was a perfect blue sky day with no worries of thunderstorms.  Only 46 more to go…










Elyse moderator at Private Wealth Forum

On June 14, 2017, Elyse Foster, CFP® moderated a panel titled “Opportunistic Alternative Investing” at the Private Wealth Mountain States Forum held in Denver.  This yearly, invitation only, day-long investor education and professional networking event was attended by many large family offices, registered investment advisors, private banks and wealth management firms.  They were able to delve into the issues and strategies surrounding asset allocation and asset protection specific to the high-net-worth community of the Mountain States region.









Hikes We Like








One of the many things to love about Colorado is hiking.  You can do it in spring, summer, fall and winter and there are so many trails to explore.  Many of us here at Harbor enjoy hiking and will be sharing some of our favorite hikes with you this year.