Originally Posted by
APC225
I don't like that there is a scenario in which my estate loses those funds. OTOH money in that account is permanently tax sheltered. It is pretax going in and then not taxed when spent. So every dollar deposited is an instant and permanent gain by whatever your tax bracket is now, or might be later. There aren't many investments that have a guaranteed gain of 20% to 30%. In addition, the investment gains within the fund are also exempt (6.19% YTD). Risk is total loss to the estate, so there is that. Someone who earns enough that maxing out the 401k creates spillage into the VEBA may be in a financial position to accept that risk.
Another way to look at it....A Pension (A Plan) pays until you're dead, or until you and your spouse are dead depending on your election. Some people bleed that fund for 35 years. Some for 3 years. This is similar. It pays your medical bills until you and your spouse are gone or until exhausted.