Health Savings Accounts

When people tak about how expenisve healthcare is, they almost always to forget to mention the cheapest option: the Health Savings Account.

A health savings account (HSA), is a tax-advantaged medical savings account available to taxpayers in the United States who are enrolled in a High Deductible Health Plan (HDHP). The funds contributed to the account are not subject to federal income tax at the time of deposit. Unlike a flexible spending account (FSA), funds roll over and accumulate year over year if not spent.

Funds may be used to pay for qualified medical expenses at any time without federal tax liability. Withdrawals for non-medical expenses are treated very similarly to those in an IRA in that they may provide tax advantages if taken after retirement age, and they incur penalties if taken earlier. These accounts are a component of consumer driven health care.

Most people can get a high-deductible policy for about $100-$150 a month. These policies don’t cover routine care. For that, you should go to a local emergicare center. You can see a doctor there for about $75.

The major benefit of a HSA is that it gives you an incentive to take care of yourself. In the event that something major happens to you, you simply pay your deductible which is normally a few thousand dollars.

If you eat healthy and get regular exercise, HSA’s are an excellent option. Any unused money rolls over from year to year and be used to pay your deductible. If you sock away at least $50 to $100 a month in your HSA, you should have enough to cover your deductible in no time. Plus, every dollar you contribute is deducted from your gross income at tax time.

You can easily start an HSA by going to