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October 12, 2011
Health Savings Accounts Reformed Health Insurance
Since Health Savings Account (HSA) Plans became available in 2004, people have been using them to reshape what health insurance had to offer. From low-cost coverage to tax advantages, HSA Plans reformed health insurance.
Health savings accounts allow people to put money aside for future medical expenses and grow that balance with tax-free earnings. When HSA funds were needed to pay for qualified health care expenses, the withdrawals were also free from taxation.
Even greater savings were possible with the chance to reduce taxable income. Within government limits, Health Savings Account contributions can be taken as deductions to lower federal, and usually state, tax bills.
One of the most important benefits of HSA Plans is that contributions may be invested just like IRA contributions. The choices range from simple interest-bearing, liquid savings accounts to bonds, mutual funds or stocks. But, unlike IRA money, HSA balances aren't locked up until HSA owners turn 65.
Another important difference is that HSA owners aren't required to make mandatory withdrawals during retirement. To learn more about the greater control that HSA Plans offer before and after retirement, please see our online resources.
Posted by Wiley Long at October 12, 2011 11:03 AM