Health Savings Accounts = Smart Financial Decision

Health care costs for Americans have been skyrocketing. According to projections by the Peter G. Peterson Foundation, total health care spending in the U.S. is forecasted to increase by 5.6% annually for the next decade — faster than the country’s economy. 

A Health Savings Account (HSA) can help you plan for and beat these rising costs. 

An HSA (Health Savings Account) is a tax-free healthcare account used together with an HSA-compatible high-deductible health plan (HDHP) to cover out-of-pocket medical expenses. HSAs serve as both short-term and long-term savings tools. Combined with your HSA-qualified, high-deductible health plan, HSAs give you an easy, safe way to pay less for healthcare expenses today and save more for tomorrow.

Qualified HSAs can be funded by anyone, roll over from one year to the next, and can be used for non-medical expenses without a tax penalty after an account holder reaches the Medicare eligibility age of 65.

Your HSA belongs entirely to you and can be used to pay for qualified medical expenses for you and your eligible dependents. 

We’re not even talking about just major medical needs. You can get tax-free savings with your HSA on everyday things like sunscreen, allergy relief products, TENS unit and so much more.

You can contribute to your account, withdraw contributions to pay for HSA eligible medical expenses, and invest your savings in a wide array of financial options—all tax-free.

You can make contributions to your HSA just like you make deposits into your regular savings account, with one big difference: The money you deposit in your HSA is tax-deductible, or can be deposited as a pre-tax payroll deduction 

Your membership with MPB Health SECURE and subsequent ability to open a HSA may be set up through your employer or if you are a sole proprietor or subcontractor, you also qualify for MPB Health SECURE.

And an HSA can help you save on taxes in three ways: 1) Annual HSA contributions are tax-free; 2) Interest accrued on HSA balances is not taxable; and 3) Withdrawals for qualified out-of- pocket healthcare expenses are tax-free. 

An HSA is like a 401(k) for healthcare. However, unlike 401(k)s, HSA contributions made pre-tax through payroll are not subject to Social Security (FICA) or Medicare taxes. HSA withdrawals are not subject to federal income tax as long as they are used for qualified medical expenses – no matter when a withdrawal occurs. 

Once you reach age 65, you can use HSA funds for non-medical expenses without penalty; but you would have to pay income tax on such withdrawals at their then-current tax rate.

You can also reimburse yourself for a medical expense ANYTIME after if occurs from your established HSA tax free.

Keep your receipts. This enables you to withdraw tax free from your HSA (as it is a reimbursement) anytime in the future.

This is an amazing tax shield that allows your to grown a nice retirement fund.