My Life in Benefits, Age 65: Retirement


While I pictured retiring at 55 when I was starting work, I ended up having to delay retirement. Now, at 65, I’m ready to say goodbye to working every day. At least, working in an office. I intend to keep working, but on something that goes beyond paper, faxes, computers and emails.

Here is how I set myself up for retirement:

More aggressive with saving

My wife Sam and I have had an HSA for several decades now. About five years ago, we did an assessment of our account. We were proud that had grown to a healthy balance of more than $120,000. But when we looked at predictions for healthcare expenses in retirement, we realized that that wouldn’t be enough. Predictions for healthcare costs after retirement come in around $285,000.

Five years ago, we vowed to be more aggressive with our HSA in three ways:

  1. Agreed to not touch any of the contributions put into our HSA.
  2. Used the HSA contribution option, which provided an additional $1,000 each year
  3. Invested a portion of our HSA balance.

In the last 5 years, we have saved $40,000. As I said in my last post, we expected a strong annual investment return of 12%. With that plus the other two strategies in place, our HSA balance has come out to more than $280,000. Enough to cover us now that retirement has arrived.

But, that’s just our HSA. I had also been enrolled in a Limited FSA and a Commuter Plan (including a mass transit account and a parking account).

Over the last several years, I have been modifying my approach to my Limited FSA and my Commuter Plan.

More conservative with elections

Commuter Benefit Account

I kept funding my Mass Transit, up until the month I retired. However, I did reduce my election over time. I used to fund my account to the full monthly limit. But in the last several years, I have been able to work from home more often, so I haven’t needed to fund my account to the full amount.

I started buying 10-day pass, so I reduced my monthly election to reflect only what I was actually using for my commute. I was able to spend down the balance in my mass transit account so I didn’t lose any money.

Finally, the last account to manage was my Limited FSA, which also needed to be spent down.

Spending down excess funds by the deadline

Limited FSA

In the years leading up to my retirement, I began to contribute a more conservative amount to my Limited FSA. When we were a family of five, it made sense to fund the account to the maximum. But now that it’s just Sam and I, we were able to look at what our spending had been on dental and vision in the last few years.

We also didn’t want to run into an issue where we had elected too much in the account and were rushing to spend it. While my company offers an additional window to use up Limited FSA funds, we knew that it made more sense for us to only elect what we’d actually use. We didn’t feel the need, at this point, to set aside an extra amount “just in case”.

So far this year, we have used almost all of our Limited FSA funds. A little faster than expected, but sometimes life doesn’t go quite as planned. And that’s why I’m glad that we have the HSA for health expenses in retirement.

Educating myself on Medicare options

The last way I prepared for retirement was by looking at Medicare. Specifically, how Medicare and HSAs interact. I knew that enrolling in Medicare would prevent me from contributing to an HSA. Since I’m still working, I decided to delay enrolling in Medicare in order to contribute to my HSA.

I encourage you to read the full article to find out which option is best for you.

Closing the book on “My Life in Benefits”

I hope my experiences have been useful to you! We’ve come a long way since I first started sharing my journey. If you want to review any of the advice I’ve provided, feel free to view visit “My Life in Benefits” any time.

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