HAS, the acronym for Health Savings Account, is a type of health insurance option available in the United States. It helps its customers to save money on their health-care.
They also save funds for most employees, and offer complete healthcare protection to workers. They are designed to aid you in managing medical expenses and decrease the continuing raising of health-care costs.
Suppose, you leave your current employer, with the HSA Health Insurance, the money you save remains as part of your retirement account. In other words, even if you don’t make use of all the money in your HSA for medical expenses, it can build up as tax-free investments for your retirement.
Benefits of HSA
Here, we are discussing about some of the main benefits provided by HSA to its customers, take a look.
- The best way to save money on Health-Care- In due course, everyone may have to spend money on health-care, and HSA helps you to do it in the best way by spending less money.
- A Tax Saver- HSA not only lets you envelop your medical expenses tax-free, but your savings to the account may push you into a lesser tax group; so you could save on your total tax statement, not only just your health-care expenses.
- With the help of HSA, you can pay tax-free for visits to the chiropractor, acupuncture, therapy, fertility treatments, eye-care, and so on.
- Portable- The account can shift from one employer to another; so if you change your current job, you need not to worry about your HSA investment.
- A better retirement account- The functionality of the HSA is much similar to IRAs, but with a major difference. When you deposit money in a usual retirement account, it is there to halt, and you could sacrifice to the extent of a third of it in the form of tax penalties, if you withdraw the amount before your retirement age. But, with an HSA, when you use the amount for your medical expenses, your debiting is completely tax-free. They can’t substitute your retirement accounts, but there is one of the major supplements for retirement savings.
- A foundation of investment income- They are constructed in such a way that you can constantly debit money as and when you need it. But, the amount that you don’t withdraw has the capability to grow and mount up interest.
- Money in your Pouch- To contribute for an HSA, you are first required to sign up in a HDHP (High Deductible Health Plan), which generally provides the lowest premiums among all health-plans.
How does it Work?
Dollars deposited into a HSA can be withdrawn directly for any qualified medical expenses as required, and any dollars remaining can be accumulated for future heath-care purposes, or invested to build up investments for heath requirements after retirement.