Offset: 294596

Roth vs Traditional Pre-tax Contributions

ROTH V. TRADITIONAL

Make after-tax contributions

Accumulate tax-free retirement money *

Taken out of your paycheck

Roth Contributions

ROTH V. TRADITIONAL

Lisa $40,000 Annual Income

6% Monthly Roth

Contribution

6% Monthly Traditional

Pre-tax Contribution

$200 Monthly Roth

Contribution*

$200 Monthly Traditional

Pre-tax Contribution*

$200 Monthly reduction

in take home pay*

$150 Monthly reduction

in take home pay*

How does

Roth affect your

paycheck?

* This hypothetical example is based solely on an assumed 25% income tax withholding rate. No other payroll deductions are taken into account. Actual taxes and take home pay will depend on your individual tax

situation. Pre-tax contributions and any related earnings will be taxed at the time of withdrawal. Any earnings on after-tax Roth contributions are income tax-free if certain conditions are met.

Bonds

Roth in workplace savings plan vs. Roth IRA

ROTH V. TRADITIONAL

2017 IRS Contribution Limits

Age 50+

$6,500

+$1,000

“Catch-up” amount (Age 50+)

Age 50+

$24,000

+$6,000

“Catch-up” amount (Age 50+)

Roth in plan

$18,000

Roth IRA

$5,500

Under Age 50 Under Age 50

2017 IRS Income Limits

Roth IRA

Single filers

$118,000

Phase-out starts;

ineligible at $133,000

Roth in plan

None

Roth IRA

Married filers

$186,000

Phase-out starts;

ineligible at $196,000

You may be able to roll the money in your Roth account in the plan to a Roth IRA account and avoid these required distributions – this option may most benefit those who want to leave this money to their heirs.

Benefits and Considerations

Are you eligible to

contribute to a Roth IRA?

How long is your

retirement horizon? What is your expected tax

bracket in retirement?

ROTH V. TRADITIONAL

Take your next step

ROTH V. TRADITIONAL

Talk with your tax advisor

Visit NetBenefits.com

Exploring the Benefits of an HSA

Reasons to Consider

an HSA-Eligible Health

Plan and HSA

HSA-Eligible Health

Plans and HSAs

Next Steps Using an HSA

AGENDA

What are HSA-eligible health plans and HSAs?

Pair together to make a unique and powerful combination

HSA-ELIGIBLE HEALTH PLAN AND HSA

• It's yours to keep even if you change

jobs or retire

• Helps you save and pay for medical

expenses

• Pays for qualified medical expenses

for you, your spouse, and eligible

dependents

HEALTH SAVINGS ACCOUNT (HSA)

• Similar to other health plans

• Pairs with a health savings

account (HSA)

• Generally lower health insurance

premiums

• Money saved on premiums can be

put into the HSA

HSA-ELIGIBLE HEALTH PLAN

How does it compare with other plans?

2With respect to federal taxation only. Contributions, investment earnings, and distributions may or may not be subject to state taxation. See your tax professional for more

information on the state tax implications of an HSA.

• Works with an HSA to help pay for

qualified medical expenses

• Generally lower health coverage

premiums

• Use HSA funds to pay out-of-pocket

medical costs tax free2

WHAT’S DIFFERENT?

• Comprehensive coverage

• No-cost preventive care

• Network of doctors

• Generally includes prescription

drug benefits

WHAT’S THE SAME?

HSA-ELIGIBLE HEALTH PLAN AND HSA

How it can work for you and your family

2With respect to federal taxation only. Contributions, investment earnings, and distributions may or may not be subject to state taxation. See your tax professional for more

information on the state tax implications of an HSA.

Tax-advantaged HSA

contribution for the

year:

$1,550 • $650 one-time employer

contribution

• $75 monthly employee

contribution

$4,200 • $1,200 one-time employer

contribution

• $250 monthly employee

contribution

$7,750 • $1,000 one-time employer

contribution

• ~$562 monthly employee contribution

(includes $1,000 catch-up)

Anticipated health care

costs for the year not

covered by the HSA-

eligible health plan:

$500 Doctor visits; relatively

healthy

$3,000 Doctor visits due to seasonal

illness; braces for daughter

$4,000 Doctor visits; monitoring supplies and

medicines to manage type 2 diabetes;

wife will need new eyeglasses

Savings carried over for

future use: $1,050 $1,200 $3,750

HSA-ELIGIBLE HEALTH PLAN AND HSA

Include out-of-pocket expenses such as:

Health plan deductible and coinsurance

Most medical care and services

Dental and vision care

Prescription drugs

Medicare premiums

Defined by the IRS

IRS Publication 502: Visit irs.gov/publications/p502 for a list of medical expenses that

generally qualify for payment or reimbursement.

Qualified medical expenses

HSA-ELIGIBLE HEALTH PLAN AND HSA

Reasons to consider an HSA-eligible health plan and HSA

REASONS TO CONSIDER

Benefits of the HSA-eligible

health plan and HSA

Generally lower

premiums

Money is

always yours

You’re

in control

HSAs let you save money

on taxes in 3 ways* Goes in tax-free

Grows tax-free

Use tax-free

*With respect to federal taxation only. Contributions, investment earnings, and

distributions may or may not be subject to state taxation. See your tax

professional for more information on the state tax implications of an HSA.

REASONS TO CONSIDER

Lawrence Livermore National Security provides

a $750 individual or $1,500 family contribution into your

HSA to help boost your savings.

Employer contribution to your HSA

REASONS TO CONSIDER

Using an HSA

USING AN HSA

How it works

Make pretax

contributions

Pay for qualified

medical expenses

Use for yourself,

spouse, eligible

dependents

Transfer from

another HSA

Contribute

How much should I contribute?

USING AN HSA

Consider contributing at least up to your deductible

Plan for out-of-pocket expenses

The total of all contributions cannot exceed IRS limits.

IRS Contribution Limits

USING AN HSA

*If age 55 or older, not enrolled in Medicare, and otherwise an eligible individual.

2018 Annual HSA Contribution Limits 2017 Annual HSA Contribution Limits

$6,750

Individual

$3,400 Family

Family

$1,000

Individual

$1,000

2017 Additional Catch-up Contribution*

$6,900

Individual

$3,450 Family

Family

$1,000

Individual

$1,000

2018 Additional Catch-up Contribution*

$260K

$220K

$180K

$155K

How much do you think a couple might spend on health

care costs throughout retirement?

USING AN HSA

$260K1

$220K

$180K

$155K

How much do you think a couple might spend on health

care costs throughout retirement?

USING AN HSA

1Please see corresponding footnote at the end of this workshop

For current qualified medical expenses

• Easy access

• Consider keeping some money in cash

For future qualified medical expenses

• Think about paying for current health

care expenses out of pocket

• Consider a long-term investing strategy

Considerations for investing in your HSA

USING AN HSA

HSA eligibility

USING AN HSA

NOT be enrolled

in Medicare

Have a valid

U.S. address

(no P.O. Box)

Be enrolled in an

HSA-eligible

health plan

NOT be covered

by another non-

HSA-eligible

health plan

NOT be

claimed as a

dependent

Next steps

Once your annual enrollment window opens

Open your HSA

Enroll in your employer’s HSA-eligible health plan

NEXT STEPS

Tips to make the most

of your health plan

Open an HSA

Shop around for

lower-cost “elective”

care services

Consider contributing

at least up to your

deductible

Note: Your HSA must be open in order to accept contributions,

including any from your employer.

NEXT STEPS

Investing involves risk, including risk of loss.

Information contained within this presentation is subject to change pending final regulations.

1 Estimate based on a hypothetical couple retiring in 2016, 65-years-old, with average life expectancies of 85 for a male and 87 for a female. Estimates are

calculated for “average” retirees, but may be more or less depending on actual health status, area of residence, and longevity. Estimate is net of taxes. The Fidelity

Retiree Health Care Costs Estimate assumes individuals do not have employer-provided retiree health care coverage, but do qualify for the federal government’s

insurance program, Original Medicare. The calculation takes into account cost-sharing provisions (such as deductibles and coinsurance) associated with Medicare

Part A and Part B (inpatient and outpatient medical insurance). It also considers Medicare Part D (prescription drug coverage) premiums and out-of-pocket costs, as

well as certain services excluded by Original Medicare. The estimate does not include other health-related expenses, such as over-the-counter medications, most

dental services and long-term care. Life expectancies based on research and analysis by Fidelity Investments Benefits Consulting group and data from the Society

of Actuaries, 2014.

2With respect to federal taxation only. Contributions, investment earnings, and distributions may or may not be subject to state taxation. See your tax professional

for more information on the state tax implications of an HSA.

*A distribution from a Roth 401(k) is federally tax free and penalty free, provided the five-year aging requirement has been satisfied and one of the following

conditions is met: age 59½, disability, or death. State taxes may apply.

The tax information contained herein is general in nature, is provided for informational purposes only, and should not be construed as legal or tax advice. Fidelity

does not provide legal or tax advice. Laws of a particular state or laws which may be applicable to a particular situation may have an impact on the applicability,

accuracy, or completeness of such information. Always consult an attorney or tax professional regarding your specific legal or tax situation.

Fidelity Brokerage Services LLC, Member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917

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Important Information