Weekend Reading: HSAs — Beyond the Triple Tax Advantage

This article appears as part of Casey Weade's Weekend Reading for Retirees series. Every Friday, Casey highlights four hand-picked articles on trending retirement topics and delivers them straight to your email inbox. Get on the list here.
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Weekend Reading

Do you have a Health Savings Account (HSA)? If so, you’re probably aware from a high level how this savings vehicle works in the way of tax efficiency, but more saving opportunities await beneath the surface that you might want to consider. Read the article from The Street below.


Some things to consider:

📌Global health care reimbursement: Any medical care that is legal in the U.S. can be paid for or reimbursed with HSA dollars anywhere in the world

📌What makes a “family” for your contribution limit and who can utilize funds in the same account is not black and white: For example, if a high deductible health plan (HDHP) makes sense for your family, funds can still be spent on spouses, partners, and dependents, regardless of who is covered under the HDHP

📌Indemnity coverage is permitted while contributing to an HSA because it’s not true health insurance: Plans such as these help cover hospital admission, certain accidents, or medical treatments by providing a fixed cash payment

📌You can transfer assets at any time: However, if your account is funded via payroll deduction, keep in mind that employer contributions are tax-free income, and those payroll contributions are exempt from FICA taxes

📌You have bonus opportunities if you’re at least age 65: Your HSA can be utilized for Medicare insurance premiums (excluding Medicare supplements), as well as for long term care

📌Be wary of passed assets: If you have substantial savings in your account, consider choosing beneficiaries in lower tax brackets, as only spouses can receive funds tax-free to their own HSA

Maximize your money: If you can find a way to access an HSA, it can be the most beneficial way to save money over the long term; but, as always, pay close attention to those beneficiary designations.