A health savings account (HSA) is a special savings account that allows individuals to save money for medical expenses on a tax-free basis. HSAs are typically funded with pre-tax dollars and can be used for qualified medical expenses such as doctor visits, prescription drugs, and dental care. HSAs are a great way to save money for medical expenses, as the funds are not subject to federal income tax and can be rolled over from year to year.
Why should I consider having a HSA?
Having a Health Savings Account (HSA) can be extremely beneficial. HSAs are tax-advantaged accounts that allow you to set aside money for medical expenses. The money you contribute to the account is pretax, meaning it can reduce your taxable income and you don’t have to pay taxes on withdrawals used for qualified medical expenses. Additionally, the funds in your HSA roll over year to year, so it’s a great way to save for future medical expenses. It can also help you pay for day-to-day medical costs such as co-pays and prescriptions. With an HSA, you are in control of how your money is spent and can make decisions to best fit your needs.
What can I buy with a HSA? You can use it to pay for qualified medical expenses, such as doctor visits, prescription drugs, vision care, and preventive care. You can also use it to pay for dental services, health insurance premiums, and long-term care insurance. You may even be able to use it to purchase over-the-counter medicines, as long as a doctor prescribes them. Be sure to check with your HSA provider to ensure that your purchases are eligible.
How do I get a HSA? If you are eligible, you can open an HSA through your employer or bank. To do so, you'll need to have a high deductible health plan (HDHP) and be under the age of 65. Be sure to check with your employer or bank to find out about any fees or restrictions associated with setting up an HSA.