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Health Savings Accounts - Basics
Manage episode 346657883 series 2907060
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Health Savings Accounts (HSA) are great for saving for future medical expenses. This isn’t news to most people, but one thing I learned that I should have known was if you have an expense this year and you don’t use it, you don’t lose it.
You can accumulate receipts and year you are covered by a High Deductible Health Plan (HDHP)...meaning if you can afford to pay your expenses now, you can save money that will grow TRIPLE tax-free.
You can collect on your prior expenses in the future after your money has grown tax-free and not have to pay tax on that money ever.
Today I am going to cover five basics:
1) Eligibility 2) Tax Treatment 3) Accumulation 4) Decumulation 5) Portability
The average married couple will spend approximately $361,000 for health care in retirement. At today’s tax rates, if you were in the 24% Federal Tax Bracket and in California’s 9.3% State Tax bracket. Not paying tax on those distributions could save you $180,229.38 in tax, if you were to pull the money from a retirement account to pay those expenses.
Learn More on the podcast website: https://poweringyourretirement.com/2022/11/10/hsabasics
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