Why are HSAs better than IRAs, 401ks, or other tax-advantaged savings programs?
With other tax-advantaged savings programs such as IRAs or 401ks, individuals and employers receive a tax deduction for their contributions and then individuals pay income tax on their withdrawals, hopefully during retirement when in a lower tax bracket. With a HSA, individuals and employers receive a 100% tax deduction when they contribute and withdrawals are not taxed, at any age, as long as they are used for qualified medical expenses. What if I don’t have, or participate in, a group health insurance plan? If you are not participating in a group health insurance plan, you can change your health insurance or purchase a new individual/family HSA-qualified health insurance policy. Click here to learn about an HSA for individuals and families not covered by a group benefits plan. What are Qualified Medical Expenses for a HSA? Virtually any healthcare or medical expense traditionally covered in whole or part by a group benefit policy qualifies as an HSA expense-expenses like: • Doctor vi
