Get the Most Out of Your HSA
If you think your Health Savings Account is just a place to “park” money in case you have medical expenses, you’re missing the point: A HSA sets money aside tax-free!
That means you save up to 30 percent on taxes for every dollar deposited into your HSA. Want to maximize this tool? Here are a few tips.
- Three D’s: Direct deposit and deduction. If your employer offers payroll deduction to put money into your HSA (most do), take advantage of it to have money direct-deposited into your HSA.
- Take it to the limit. You get the biggest bang for your buck if you go for the maximum. For 2016, you can contribute up to $3,350 for individuals or $6,750 for families (if you’re over 55, you might be able to add another $1,000).
- Choose your bank. While many employers’ HSA accounts offer a bank partner that will set up your account, set up your account at your own bank to simplify your money life.
- Use it for the “little things.” Your HSA account isn’t just for doctor’s visits and prescriptions. You can also use it for dental treatments, crutches, and more. Check your plan for a full list of what’s allowed.
- Roll it over. Didn’t use all your money in a plan year? No problem. The money rolls over to the next year with no penalty.