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Health Saving Account: A Comprehensive Guide

If there is one common cause for which all the people save money is health care. The moment you are an adult, you have the responsibility to save for your health and the elders at home. If you are in corporate business, then you must have heard of various saving plans. One such investment tool is HSA or Health Saving Account.

Health Saving Account has made health care in India increasingly affordable. Amidst the soaring inflation affecting all the sectors, the health sector is usually the worst hit. And its impact can pass through generations. It is because of this reason that George W. Bush introduced HSA in 2003. Since then, it has been like a safety valve.

About HSA

Health Saving Account is a savings account whose money is used to pay only medical expenses. As the name suggests, it is like saving for health. The advantage is that it is a tax-advantaged saving account. Under this, anybody can open the HSA in the bank. It means that even the corporation that you work with, can also open this for you. Secondly, if you or any one of your immediate family person uses your insurance, then registering under the high-deductible plan is a prerequisite. You should also know that banks have their limits for HSA. It is a cap on the yearly contribution you can make, with elders above 55 having an additional $1000 limit.

Why choose HSA?

  • One of the biggest advantages of HSA is saving for your health. While planning monthly expenses, many times, health expenses take a backseat. By opening HSA, you can have a separate saving for your health.
  • Having HSA means to have a bank balance for unforeseen health issues. People have also been using HSA for dental expenses. Accidents and health problems can happen to anyone at any time. HSA money can be used in such situations.
  • Another advantage is that the money stays with you. If you haven’t spent this year’s savings, it will get rolled for next So you are not losing anything.
  • Lastly, HSA is tax-free. So, you are saving money on two ends.
  • For an economy, it cuts on the continuous growth of medical costs.

If you are living in the United States, you shouldn’t have a second thought about HSA. It is a cost-efficient way of saving for all kinds of medical expenses.

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