Atlanta Financial Newsroom

The Tax Cut and Jobs Act of 2017, which became effective for tax years starting in 2018, significantly impacted many taxpayers. The change impacting the most taxpayers was the enhanced standard deduction and loss of many itemized deductions. Tax forms were also presented differently making it difficult for taxpayers who reviewed their returns in detail to compare year-to-year. While there were many changes, there are still some important tax savings strategies that may help you pay less in taxes. Which ones apply to your situation?  Ask yourself the following questions…

At AFA, we hear our clients express concerns about two financial challenges more often than any others:
• Will I be ready to retire with the lifestyle I want?
• What can I do to protect myself from rising health care costs now and in the future?

Did you realize there is a single vehicle that can help you make progress in both areas? It’s called a health savings account (HSA), which is a government-regulated savings account that combines many of the tax benefits of a Flexible Spending Account and a 401(k), including:
• Your contributions to the plan are pre-tax (if offered through your employer) or tax-deductible (if established on your own). If funded through your employer’s plan, you also don’t pay FICA on the contributions, putting an extra 7.65% back in your pocket.
• Withdrawals for qualified medical expenses are tax-free (more about that below).
• The balance in your plan (that you don’t spend for medical expenses) grows tax-deferred and can be rolled over from year to year, supplementing other retirement savings.

Over the years we’ve seen plenty of research and studies claim that increases in income don’t correspond to increases in happiness. One such survey, using data from the Gallup World Poll, found that the optimal household income for emotional well being was between $60,000 and $75,000 per year. The research shows that beyond that threshold, the correlation between income and happiness flattens pretty dramatically. For many Americans – especially young professionals just getting started in their careers – this may seem like a bogus finding, but by going beyond the headlines we learn that a common reason for that drop-off in financial satisfaction is lifestyle creep.