Questions About HSAs, Savings Bonds, Frozen Vegetables, Library Books, and More!

What’s inside? Here are the questions answered in today’s reader mailbag, boiled down to summaries of five or fewer words. Click on the number to jump straight down to the question.
1. “Claimed” HSA dollars
2. Lost savings bonds
3. Moving money while abroad
4. Order of loans
5. Disappearing contractor
6. Long lasting cooler
7. Never enjoying your savings
8. Flash frozen vegetables are bad!
9. Church community without faith
10. Every Kid in a Park
11. Books worth keeping from library
12. Keeping up with the news

This past weekend, I attended a three day long family reunion with my wife’s extended family that included between thirty and forty people for almost the entire duration. We basically took over someone’s home and property with campers and tents and spent three days together.

It was great. I think it worked so well because the place we stayed was fairly isolated. There weren’t places to go or things to do, other than the things that people decided to bring to the reunion or do together at the reunion. People brought games and sports equipment and the hosts had a swimming pool. It was a weekend filled with conversation and shared meals and games and sports and camping.

And it was wonderful. I highly recommend it.

Q1: “Claimed” HSA dollars

Do ‘claimed’ HSA dollars count as part of your annual income for the year? When is a good time to claim or not to claim? I haven’t been claiming, because I can afford to pay for my medical bills right now. I have been saving for a rainy day. I’m not sure if this is a good approach or not.
– Connie

If you make a claim for HSA money with a qualified medical expense, then you won’t have to pay taxes on that money. There is no “best time” to claim – any time you have a qualified medical expense is a good time to claim.

The IRS doesn’t provide a full list of what is or what isn’t a “qualified medical expense,” but as a quick rule of thumb, a qualified medical expense is anything that includes preventing, curing, or treating a disease or mitigating the symptoms of a disease, as well as any medical treatment intended to repair or prevent injury to any part of the body.

If you take a distribution from a HSA (which is what you’re doing when you make a claim and the account pays out to cover a medical bill), you have to prepare Form 8889 next year when you file your taxes (it’s really short). You’ll also receive a 1099-SA form in the mail early next year, which will indicate whether or not the distribution was used for a qualified medical expense. If it wasn’t used for a qualified medical expense, you’ll have to pay taxes (and an additional penalty) on that money.

Q2: Lost savings bonds

We lost our kids’ savings bonds in a flood. We know the general year and month of when they were issued, but nothing else. Is there any way to get the money?
– Claire

The Treasury Department has a form just for you!

All you need to do is fill out Treasury Form 1048, then take it to your local bank to have it certified, then mail it in to the Treasury Department. If they can find your bonds, they will.

Be aware that the wheels will turn kind of slow on this type of submission, but in my experience they will get around to it. Just be patient.

Q3: Moving money while abroad

I intend to move to somewhere in Africa next year, and I will have family sending me money through Paypal. I will keep my checking account in America and also have one in Africa. When I receive the money in my Paypal account, via PaypalMe, I will need to transfer that money from Paypal to my American checking account, and then I’ll need to transfer that money from my American checking account to my African checking account. Is there an easy way to do this?
– Daniel

My first question would be whether it would be possible to directly link your PayPal account to your African checking account in addition to your American one. If you can, then this is easy – all you have to do is transfer the money that way.

Another option that might work would be to open a new PayPal account associated with your African checking account and then send money from your old account to your new account regularly.

If there are other reasons for transferring the money to your US bank account first, then make sure that the US account has a robust online banking system. That way, you can log into there from Africa and easily initiate the transfer.

Q4: Order of loans

My family and I have lived aboard for close to a decade, and are looking at returning to the states in the next 5-6 months to live and work. We have fine credit (750+), no debt, and about 15K saved up for a possible down payment. We would, on returning, like/need to purchase both a house and a car. Is there a better order to do this, particularly as it affects our credit score? That is, should we apply for a home loan first because applying for an auto loan first would affect our credit/home loan negatively? Or I am not even asking the correct questions?
– Alex

If I were in your shoes, one of the first things I would do upon arriving in the US is visit a community credit union in the area that I’m moving to. Stop in and ask them what they would recommend, as they will potentially serve as a lender for at least the home mortgage. If you have multiple credit unions in the area, visit each of them and see what they say.

My guess is that if you have solid credit (which you do have) and proof of good employment, you should be able to apply for both loans in fairly short order, though you may find that applying for one loan first might reduce your credit score enough that the second loan doesn’t get a prime rate. This is why it’s useful to actually talk to a financial institution about your actual full situation.

I would give some thought now as to whether owning a home over renting is a bigger need than owning a car. It really depends on the area where you’re moving and how prevalent mass transit is in that area.

Q5: Disappearing contractor

Hurricane Harvey hit and our house flooded when our newborn daughter was 8 weeks old and I was on maternity leave. It could have been worse but there was a lot of damage. Our FEMA claim was denied for an unknown reason, and We’ve spent the last year putting our lives back together after all of this. It has been a nightmare to say the least.

The last item pending to be fixed was the master bathroom, which was so outdated we decided to put the rest of the savings we had into getting it remodeled instead of “turd polishing” what it was before. The people we hired seemed legitimate, are accredited on BBB, etc. We did our homework (or so we thought). I realize now that the contract we signed asked for too much money up front, and once they began the work, red flags started popping up daily. We are now looking at a bathroom that has been gutted, dry wall put up and primed/textured, with nothing else completed.

The company we hired to do this work stopped responding to calls/texts/emails, turned off their office number, and has a sign on the front door with a notice of eviction due to lack of rent payments. We’ve reached out to their subs (and the rental company) and no one has heard from them — everyone is in panic mode. We fear the worst and believe we have lost about 20k, with an empty bathroom and no hopes of getting any more work out of them. Where do we go from here?

We’ve consulted a few lawyers who don’t think we will recoup our money for various reasons, but we are terrified of making another mistake (somehow violating the contract if they come back 2 months from now, or worse, hiring another company that does a poor job or takes more money).

I’m out of trust, I feel like advice isn’t solid from any resource, and we are too ashamed of what happened to tell our friends and family. To top it off, baby #2 is due in Oct 2017, putting our income at a much lower rate again for 3 months while I am on leave. My husband can’t sleep at night, and we’re almost out of savings. Do you have any advice on what steps we should take, and how we can protect ourselves fully moving forward?
– Sandra

I agree with the lawyers you met with. There is almost no chance that this company reappears in any form in which they would be finishing the work on your home. They appear to be out of business and it’s likely that the business has very few assets with which you could make a claim against.

You have to move forward from here. Given what you describe as having been done in your bathroom, my recommendation is that you and your husband give a serious attempt at finishing it yourself, as most of the hard tasks are complete. It’s been gutted and new drywall has been put up, which means that the tasks that are left are installing new cabinets and fixtures, painting the walls, and tiling the floor, all of which can be done by almost anyone if they take their time with it.

I would stop hoping for the future and start learning how to do some DIY tasks. Yes, it will take some time and, yes, you’ll probably make a few mis-steps along the way, but you can do this, and it’s not only the most cost-efficient route forward, it’s also one that will build your confidence mightily for tasks in the future.

Q6: Long lasting cooler

I bought a cooler about 3 years ago from an estate auction and used it a lot but now it has a hole in it and has leaked into the lining and has mold in it so I tossed it. I want to buy a good replacement cooler. I want a big cooler enough to carry food and beverages for a lot of people. Do you have a recommendation for a “buy it for life” one that will last for many many years?
– Sam

There are basically two classes of coolers, without anything really in the middle.

Lower end coolers are usually made out of ordinary plastic and will hold up to occasional use for quite a while. If you’re not using your cooler on a multiple-times-a-week basis and keep it stored out of the sunlight and don’t need it to keep things cool for literally days, a lower end cooler will do the trick. My recommendation here is a Coleman Extreme, like the one linked there.

On the other end are the moulded coolers, which are made out of a much sturdier plastic with metal hinges and much better insulation. However, such coolers often get up in the $300 range, like this excellent Pelican Elite cooler. It will last a lot longer than a Coleman and keep stuff cold for days, which is great if that’s what your situation calls for. However, most people just wanting a cooler for a family gathering or a day trip or a weekend camping trip on occasion will find it to be overkill, and such coolers are definitely heavier than the lighter Colemans of a similar size.

I’m excluding things like metal options which aren’t really viable for easy transport and usually stay attached to a vehicle.

So, if you just want a big cooler for day trips or weekend camping trips and don’t intend to use it constantly, I’d just get the Coleman Elite noted above. If you’re using it much more than that and need to keep stuff cold for several days, then I’d invest in a better cooler.

Q7: Never enjoying your savings

Have you ever considered that you might never get to enjoy all of the money you’re saving?
– Alex

Absolutely.

On the other hand, my life is pretty happy as it is right now. What else do I really need? What else do I actually want that isn’t a trifling passing fancy?

The biggest things I really want out of life are low stress and good relationships and meaningful work and leisure time and the ability to launch my children into independent adulthood (meaning that they don’t rely on our money in any way). How exactly does spending a lot of money really help any of those things? It doesn’t.

However, saving for the future does help with at least some of those things.

I don’t miss out on needs or on serious, legitimate wants. At the same time, I don’t miss the stress of living paycheck to paycheck.

The good life, in my eyes, isn’t about spending every dime you make chasing the pleasure of the moment. It leaves you with nothing more than an endless ride on the pleasure treadmill.

Q8: Flash frozen vegetables are bad!

I think you should stop recommending flash frozen vegetables in your articles. They have no flavor and awful texture. No one wants to eat that stuff!
– Erin

First of all, most of the flash frozen vegetables I’ve tried are very similar to steamed vegetables of the same type. If you take the fresh version of those vegetables and then steam them, they’re going to taste a lot like flash frozen vegetables. In either case, you have to season them if you’re going to eat them as a side dish, though they work fine if you need to add fully cooked vegetables to a dish.

The advantage that flash frozen vegetables have is that they’re already prepped for long term storage in the freezer. If you buy fresh vegetables and then decide to save them for any length of time, you have to steam and then freeze them yourself in your own container, and the cost of the fresh vegetables is usually just straight-up comparable to the flash frozen vegetables.

My strategy, when I use flash frozen vegetables directly as a side dish, is to thoroughly season them in some fashion. A bit of salt and black pepper is a given, though I might use garlic or butter or something else entirely, like a sauce. They’re pretty bland if served as is, but so are steamed vegetables.

Q9: Church community without faith

One of your frequent suggestions for frugal people looking for others to socialize with is to visit a church. What do you suggest for people who are agnostic or atheist like myself? Civic groups?
– Sara

Aside from civic groups and meet ups, my main recommendation for atheists and agnostics is to take a look at their local Unitarian Universalist congregation. Unitarian Universalism essentially teaches a synthesis of the humanist beliefs of world religions in a church-like setting for a shared experience. A friend of mine calls it the “church of reason.”

I have done a lot of religious exploration in my life and that included going to services of a wide variety of religions, particularly throughout my twenties before I had children and that became much more logistically challenging. I felt like UU was a good place for people to go who didn’t feel like they connected with the “religious” portion of church but desired the shared community and other aspects of it.

Aside from that, your best bet is to try lots of community organizations and meetups, as you mention.

Q10: Every Kid in a Park

What is the catch with the every kid in a park thing? Is it just a way to get a free national parks pass?
– Angela

If you have a fourth grader, then that’s exactly how it works. You go through some online activities, print out a pass, and then you’re good to go. It provides a one year National Parks pass for a fourth grader and his or her immediate family.

If you use it, be aware that national park rangers are aware that some people might use this for fraud and will require you to have a child that appears to be a fourth grader with you when you use the pass. That’s the intended purpose of the program – it’s not to get two adults a free vacation in the national parks.

We’ve used this program twice with our two oldest kids – the oldest one used it when we went to Cuyahoga Valley National Park, and the youngest one used it at a bunch of places – Badlands, Yellowstone, Devil’s Tower, and so on. Our youngest one will be ready in a year or two and we intend to have a summer vacation centered around national parks that year, too.

Q11: Books worth keeping from library

How do you decide if a book is worth buying if you check it out from the library?
– Stan

In general, I’ll decide to buy a book that I checked out from the library if I find myself wanting to turn to it again in the future. If that happens, then there’s something in that book that’s either worthwhile for reference or worthwhile for repeated entertainment, and those are the books I want on my bookshelf.

So, whenever I want to read a new book, I check it out from the library and read it myself. I might jot down some notes on it while I’m reading it. Then, I return it to the library.

At a later date, I might decide that I want to read it again or review it again. On occasion, my notes on the book will suffice. If not, I lean strongly toward buying the book, because I’ve found that books I revisit once often turn into books I want to revisit many times.

Q12: Keeping up with the news

How do you keep up with world and national news online without paying to subscribe to a newspaper?
– Carol

In short, I don’t keep up with the latest news. I have found that headline news is often so erroneously reported and often so full of spin and bias that it’s basically unreliable. Furthermore, it’s not anything that’s really actionable – it’s not going to cause me to do anything and it’s not going to change my mind on anything. It does not genuinely make me more informed about the world. For the most part, I just don’t follow headline news.

Instead, when I come across a topic that I want to know more about, I dig into that topic and read well-regarded books and well-researched journalism on that topic. That way, I gain actual deep knowledge on topics, things that can change my mind and even sometimes change my actions. I genuinely can’t think of a time in which headline news actually changed my mind or changed my actions. Go through a newspaper and ask how many of those articles actually changed your mind or changed your actions or actually informed you on an issue that affects your life or your way of thinking. The number won’t be as high as you think, even if you try really hard to give articles the benefit of the doubt.

“What about voting?” About a week or so before an election, I go see who’s going to appear on my ballot and research each candidate to decide who I’m going to vote for. I view the election cycle as being little more than a reality television show, as neither candidate is even trying to persuade me to change my views. They’re mostly trying to summarize their views in a five second sound bite or make the other candidates sound like they’re evil, neither of which is useful to me.

I can’t help but occasionally stumble across headlines in a given day and if something seems interesting, I’ll look into it, but I don’t actively seek out headlines. I usually go to AP or Reuters if I want to read such an article and if it refers to original reporting somewhere, I might go seek that out, too.

Got any questions? The best way to ask is to follow me on Facebook and ask questions directly there. I’ll attempt to answer them in a future mailbag (which, by way of full disclosure, may also get re-posted on other websites that pick up my blog). However, I do receive many, many questions per week, so I may not necessarily be able to answer yours.

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