While HSAs have grown in notoriety over time, their benefits are still underutilized by many Americans who have them.
In a recent article for the Wall Street Journal, “Confused About Health-Savings Accounts? Here’s What to Know,” NFP’s Jared Benson, vice president and retirement plan consultant, discussed the importance of investing money into an HSA.
“While HSA money ideally should be allowed to accumulate and increase through investing, there are people who choose a high-deductible plan because it has a cheaper premium. An HSA can work for them, too, Benson says.”
Benson talks about how the money saved monthly from electing a high-deductible plan, if possible, should go into an HSA.
“Instead of spending that savings elsewhere, he recommends they invest the money in an HSA, reap the tax benefits, and use it as medical expenses come up or down the road for retirement if they are able.”
The rest of the article provides helpful answers to common questions about HSAs that demystify this beneficial tool, including:
- Who can use an HSA?
- Why consider an HSA?
- What can HSA funds be used for?
- Why should I invest the money?
- How often should I rejigger my investments in an HSA?
- What should I do if my company doesn’t allow me to invest my HSA money?
- Can I contribute to a 401(k) and an HSA?
- Are there potential penalties to consider?