More and more Americans are transitioning to pairing high deductible health plans with a Health Savings Account (HSA). According to America’s Health Insurance Plans (AHIP), almost 20 million policyholders are enrolled in these tax-preferred accounts when it comes to setting aside funds for medical expenses in the near future and for retirement. Below are just a few of the many benefits HSAs bring to consumers:
- Contributions by you or your employer are tax-free (the annual maximum contribution is $3,350 for an individual, but leftover funds can roll over to the next year and accumulate)
- Withdrawals are also tax-free, so long as the money is used for qualified medical expenses.
- HSAs are portable. As a policyholder, you are the owner of your HSA, whether you change jobs or change your insurance carrier.
For more information, check out today’s Wall Street Journal on the importance of HSAs and why they shouldn’t be overlooked when saving for retirement. If possible, take advantage of the annual maximum contribution, since they become prohibited once eligible for Medicare!
