What Is a Health Savings Account and Who Should Use It
A Health Savings Account (HSA) is a tax-advantaged account designed to help individuals save money for qualified medical expenses. If you're wondering what is a Health Savings Account (HSA), it’s a personal savings account you can use to pay for healthcare costs like doctor visits, prescriptions, dental care, and more. To open an HSA, you must be enrolled in a high-deductible health plan (HDHP).
One of the main benefits of an HSA is its triple tax advantage. Contributions are tax-deductible, the funds grow tax-free, and withdrawals for eligible medical expenses are also tax-free. This makes HSAs a powerful tool for managing both current and future healthcare costs. Additionally, unlike Flexible Spending Accounts (FSAs), HSA funds roll over year after year and remain with you even if you change jobs or retire.
Understanding what is a Health Savings Account (HSA) can help you make better financial decisions about your healthcare. Whether you're preparing for unexpected medical bills or planning for retirement, an HSA offers flexibility, control, and long-term savings potential. It’s a smart option for individuals and families looking to reduce healthcare expenses while enjoying valuable tax benefits.
