Daniel Stewart

Are You Taking Advantage of the Top HSA Perks?

Millions of Americans today are struggling with the high cost of health insurance and medical expenses today. Many of those who have health insurance coverage are burdened by a high deductible. A Health Savings Account, or HSA, is an effective solution for dealing with medical expenses, but only 22 million Americans are using this incredible tool today. With a closer look at the many exceptional HSA perks, you will see why this is one financial resource that you should be taking advantage of.

Tax-Free Contributions and Growth

Once your HSA account is set up, you can contribute up to $3,500 annually for individuals or up to $7,000 for families. These are tax-free contributions, so this is an effective way to reduce your annual tax liability. Once the money is in the HSA account, you can keep it parked in the same way you use a savings account, or you can invest it. Because of the opportunity to invest the funds, the account functions similarly to an IRA. The money grows tax-free.

Tax-Free Withdraws for Qualifying Medical Expenses

The primary purpose of an HSA is to ease the financial burden associated with medical expenses not covered by health insurance coverage. Because of this, you can withdraw your funds at any time for medical expenses without paying taxes on the growth or the original contribution. This is money that can be spent on everything from prescription medications, copays and the deductible to Medicare premiums and more.

An IRA-Like Investment Vehicle

The funds not used each year will rollover. If you have major medical expenses, the funds are there to withdraw as needed. If not, the invested money will grow tax-free. When you are 65, you can start withdrawing the money without a penalty. In this way, the account functions like a traditional IRA.

Do you have a high health insurance deductible, or are you worried about the potential for expensive medical bills? Taking advantage of the benefits of an HSA account is the perfect solution.

Author Resource:-

Daniel Stewart has been helping people with their money management and personal finance with over 15 years' experience in business finance. You can find his thoughts at healthcare trends blog.