Rethink How You Use Your Health Savings Account

When it comes to saving for retirement, many savvy investors contribute to an Individual Retirement Account (IRA) and a 401(k) or 403(b) account. But did you know that a Health Savings Account (HSA) can be considered part of your overall retirement portfolio?

An HSA is a savings account that can be used for out-of-pocket medical, dental and vision expenses. For those with a high-deductible health plan,* an HSA can be a powerful savings tool offering triple tax-free benefits.

Triple Tax-Free Benefits

1. Contributions are made on a pretax or tax-deductible basis.
2. Savings grow tax free over time.
3. Withdrawals for eligible medical expenses are tax free.

Not only does an HSA offer tax-free benefits, another important feature is the ability to invest your assets. Rather than use your HSA funds for today’s prescriptions, eyeglasses, and doctor visit copays, you can invest the funds above the minimum cash requirement in a wide range of investment options, including mutual funds, for health-care expenses in retirement. Investing your HSA assets helps take advantage of the power of compounding returns to fund health-care costs that typically rise as you age.

Jemma Financial – HSA Services Available Through Schwab

Now you can start an HSA account or roll over an existing account with Jemma Financial. In 2024, individuals can contribute up to $4,150; families can contribute up to $8,300. Similar to an IRA, there is a “catch-up” provision where account holders 55 and older can make an additional annual contribution of $1,000. Ask your Jemma Financial Advisor about HSAs today.

*The Internal Revenue Service defines a high-deductible plan as any plan with a deductible of at least $1,600 for an individual or $3,200 for a family.