The Merrill Lynch Medical Savings Account (MSA) is a tax-deferred saving and investment account, similar to an IRA, designed for use in conjunction with a qualified, high-deductible health-insurance plan. Anyone eligible to open an MSA can use it to save for qualified medical expenses and to supplement retirement savings.
BENEFITS TOO GOOD TO PASS UP
If you are self-employed or an employee of a small business, and you are covered by a high-deductible health-insurance plan, you may be eligible to open an MSA. An MSA can help you accomplish the following important goals:
* Lower annual taxes. If you are self-employed, MSA contributions are tax-deductible. If you are covered by an employer's plan, contributions are excluded from pretax income, much like 401(k) contributions.
* Save money on a tax-advantaged basis. The funds you contribute to an MSA can be invested tax-deferred and withdrawn tax-free to cover qualified medical expenses.
* Save for future medical expenses. MSA funds can be withdrawn tax-free to pay high health-insurance deductibles and qualified expenses not covered by your plan. Those expenses may include, among other costs, hospitalization, emergency treatment, ambulance service, doctor's office visits, lab services, prescription drugs, wellness and prevention programs, vision care and dental expenses.
* Additional retirement savings. Supplement retirement savings with funds not used for medical purposes.
* Lower health-care costs. In most cases, annual health-insurance premiums are considerably lower for high-deductible policies. You can use the tax-advantaged MSA to bridge any gap in coverage.
The Merrill Lynch MSA has no required account-opening minimum and offers the following benefits:
* Easy access to account assets via checks and a Visa® debit card.
* Daily sweep of funds into an interest-earning money fund.
* Simplified recordkeeping with a comprehensive, monthly statement.
* 24-hour access to account information when you call our toll-free number, (888) INFO-MSA.
ARE YOU ELIGIBLE?
You can open a Merrill Lynch MSA if you are in one of the following categories:
* Self-employed (or the spouse of a self-employed person) and maintain a qualified, high-deductible health plan for yourself or your family.
* An employee (or the spouse of an employee) of a small business that maintains a qualified, high-deductible health plan.
* A small-business owner with a high-deductible health plan.
* A partner in a professional association (e.g., a limited liability partnership [LLP] or a limited liability corporation [LLC]).
For you to qualify for an MSA, your health plan must meet one of the following criteria:
* An annual deductible of $1,650 to $2,500, with maximum out-of-pocket expenses up to $3,300 for individual coverage.
* An annual deductible of $3,300 to $4,950, with maximum out-of-pocket expenses up to $6,050 for family coverage.
THE MERRILL LYNCH DIFFERENCE
Merrill Lynch is the only full-service investment firm currently offering this type of account. When you fund your MSA, Merrill Lynch can help you develop an appropriate investment strategy and give you access to the research and investment alternatives you need to put that strategy into place. Your Merrill Lynch Financial Advisor can help you monitor your investments, rebalance your portfolio's asset allocation as necessary and help you increase the retirement-savings benefits of your account.
