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What is an HSA and should I use one?

There are many, many programs out there that peoples can use. There are health insurance programs, automobile insurance programs, homeowners insurances programs, childcare insurance etc, etc. There are SO many financial programs.

Once such financial is HSA, standing for health savings account. It is a type of financial programs that is kind of like a 401k type investment mixed with a high deductible health insurance plan. It is pretty good if you decide to use it. It could provide you with some great benefits.

Some great benefits and reasons why you should use an HSA are:

-You save money on health insurance premiums and payroll taxes. This is great. These are two things that could cost you a lot of money, they cost other people a lot of money, and yet you could save on them because you have a great HSA financial set up.

-All contributions to the HSA are tax deductible. That means that any money that you put into it cannot be taxed. That is a great benefit. There are not many accounts like this where the government cannot tax you on them. So if you invest in this, you can rest assured that your money is protected from the government.

-Investment build-up is tax-free. This is also great. Not only is the money that you put into it free from taxes, but the interest and such is also tax-free. Man, what a great program. If you signed up for it, look how much money you would be saving!

-Money in HSA can be invested in a 401k or an IRA. This is also great because your money is not restricted to the HSA you can put it into other areas too. This is a great benefit because you can put it into other health programs that would greatly help you in the long run, such as a 401k. There are not many programs that allow this.

There is also something to keep in mind when investing in an HSA. If you invest in HSA it is meant for medical expenses. But that doesn't always mean you cannot take money out to use it for other expenses. You can, but after the age of 65 any money you take out to use for something other than medical expenses will be taxed as ordinary income.

This is not such a bad thing. You will still have all the benefits with your medical expenses and such. You will still have the tax free benefits of deposits and interest. You will just not have the luxury of being able to take money out and not having it taxed. Any other account or anything that you invested money would have this rule, only it would not only apply after the age of 65, but always.

An HSA account really is a great thing and there are many reasons why you should consider getting one. All of the benefits are great. They are not just things that help you with medical expenses but with a lot of other things having to do with your finances. It is a great investment and one that you should definitely consider.

If you do not know whether or not to get an HSA account you may want to just consider the fact that it has the benefits of both a 401k and a high deductible insurance plan mixed together. That means if you go for a 401k plan you will be missing out on the high deductible insurance plan benefits, and if you go for a high deductible insurance plan you will be missing out on the 401k benefits. You had better just do the HSA and get the benefits of both!

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