Can someone explain in a very simple way the benefits of the HSA? Wondering what value am I missing out on here.

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But only works if you really don’t have a lot of medical expenses, correct? E.g., if you take speciality drugs they won’t be covered under high deductible plan? Or will they once that deductible is met?

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Same here. I used to opt for the high-deductible plans and contribute max to HSA. But last couple years our medical costs have gone up so I have switched to HRA plan which has higher premiums but low deductible and better coverage. So run the numbers for your expenses and decide

It’s for the healthy and wealthy.

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You never pay taxes on the money - simple. Healthcare costs will only rise and you will need the money at some point in the future. Always available to you - next year or in 40.

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M2, because most relatively healthy people don’t fully use their healthcare, and if you use the HSA, those expenses are tax advantaged. Even if they’re potentially a little higher OOP right now, in the aggregate it’s quite likely not near what you’re paying in to it. (That’s how insurance companies make money.) you have catastrophic coverage in case of emergency. The HSA is pre tax $, that grows tax free, and isn’t taxed when you spend it. You can bank that $$ now to help offset your (likely much higher) costs of care when you retire.

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Triple tax savings.

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You don’t pay FICA taxes if your contributions are deducted through your payroll.

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Could be free money if your firm also contributes to it. For example, I currently get an annual $1400 (individual) from firm into HSA, those with family coverage get $2400.

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Thats very generous!! My current company is a $400/ year employer contribution. Previous company was $25/payperiod contribution. My partner's company is $0 employer contribution

All contributions are pre-tax. Any distributions are tax free if used for medical expenses.

At 65, it’s equivalent to an IRA if not used for medical expenses (I.e., only subject to income tax rates; not penalty). After an employer March, easily the best deal out there.

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It’s like giving yourself an 18% discount every time you pay for a health care cost with HSA dollars vs. after-tax dollars. (Or whatever your effective tax rate is %)

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Triple tax advantaged. Contribute tax free, grow tax free & withdrawal tax free.

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Wanted to share my experience with my HSA. I have very low medical expenses. I usually go to the doctor less than 4 times a year and take medication for migraines.

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$0 to be allowed to invest within a HSA. I do pay expense ratios for the funds I invest in, but they’re the same funds everyone has access to outside of a HSA. All EY employees with a HSA pay $18 a quarter (I believe it’s the amount or it could be $16) to have a HSA. That quarterly fee is charged no matter if they invest or keep the money in cash.

It's basically a 401k you can use on health stuff, all while lowering your premiums.

Additional savings vehicle (annual max $3550 - Indiv, $7100 - family). You can also invest it and get triple tax benefits. (Pre tax, no tax in gain, no tax on withdrawal if health expenses).

2021 max contributions: $3,600 - indiv, $7,200 - family

Note that the limit is $3600 for 2021

Triple tax savings = contributions reduce taxable income, you can invest the money and it grows tax free, and you don’t pay taxes on the money when you withdraw it.

Simply put, you never pay taxes on that money like KPMG1 pointed out 💃

It's pre-tax and you get to invest it so you just make more money. It is basically a way to family health insurance that works in theory but not in practice because if the market crashes so does the HSA investment value.

Can someone explain why the government only allows HSA when you have a HDHP? Why can’t I contribute to a HSA without health insurance?

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