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One of the best ways to have a practical savings account that grows wealth while remaining relatively liquid is to open an HSA. An HSA calculator can help you figure out how much money you could be saving, as long as you know why you need one in the first place.

HSAs don't need to be complicated! Below we break everything down so it's easy for you to understand the advantages of having one.


What can an HSA plan calculator do for me?

Using an HSA Plan Calculator, you can see how much wealth you could be building and how much you could be putting away each year.

With an HSA, you can save for your health care needs and your retirement at the same time. If you're a healthy person, you'll be putting money away for your future either way.

If you're young and wondering whether or not this savings plan is for you, this calculator can aid in your decision.

Who can open an HSA?

While you might think that you'd have to own your own business or have access to a lot of capital to implement your own HSA, it's not true.

All you have to do is to have a High Deductible Health Plan (HDHP), and you'll be able to set up an HSA.

What Is An HDHP?

The IRS outlines an HDHP as any insurance with a minimum deductible of $1,350 for an individual or $2,700 for a family.

If you work for someone else, you don't need your employer to set up your health savings account or contribute to it at all. If they offer a qualifying insurance policy, you can set it up all on your own.

Waiting for your employer to get around to prioritizing your health savings account could take forever. You can take things into your own hands and enroll in your own account by contacting an HSA custodian.

Are HSA contributions tax deductible?

Contributions that you make to your HSA can be deducted from the gross pay that you report on your tax return. For the self-employed, that's also known as your business income and it appears on the front page of your return.

This tax deduction can be powerful and can make the difference between paying a higher or lower rate of tax. If you want to end up in a lower tax bracket, or if you're just on the edge of paying a much higher tax percentage, this could be the answer.

Check the latest rates on the IRS website or talk to an accountant to see what they suggest.

What can an HSA plan be used for?

HSA plans are designed for pay for qualified medical expenses.

If you spend money on qualified medical expenses, you won't have to worry about paying income taxes on those withdrawals.

If you pay for deductibles, dental care, eye doctor visits, acupuncture, or even stays at the hospital; you'll be saving money.

Accessing The Account

You can even start withdrawing immediately. Instead of having to wait for a qualified period, you can withdraw money when you need it. If you're able to change the way you normally spend on health care, you'll be seeing serious benefits.

Take the time to stop off at the bank on your way to the doctor, and you could pay with your HSA instead of your credit card. As soon as you deposit money into your account, it's ready to be used.


By paying for your bill with your HSA card, and you'll generate a nice write-off. It won't matter at all to your healthcare professional, but it'll matter to your tax bill and the IRS.

They'll allow a deduction and you'll save money on medical costs.

Do HSA dollars expire?

The funds in your HSA don't go away if you don't spend them. Where some similar products abide by a "use it or lose it" kind of rule system, thankfully that's not the case with an HSA.

The funds in an account will grow if you leave them alone. They can build interest to help fund future healthcare needs and won't be taxed. The investments you make with it aren't counted toward contributions.

HSA is a smart and savvy way to save money responsibly for a practical purpose.

Can I self-direct my HSA?

Yes, absolutely.

Within your HSA, there will be different ways to direct the investments that allow the account to grow.

When you self-direct, you're not stuck with the same kind of mutual funds that institutions will pile your investments into. If you're interested in investing and like to play the market, you can do your own trading.

Invest in a restaurant, real estate, or even local businesses. Place your funds in the hands of a custodian working at your financial institution and let them help you move money around.

Rather than working at your local bank, you could be building wealth on the market.

While you might not get rich overnight, you could see more growth than if you'd just placed your money in a savings account or a mutual fund.

Can health savings accounts be used for retirement?

Yes. Around your 60th birthday, you get the option to take money out of your account for non-health care related expenses.

You will then pay federal income tax for it, but you could also leave the money in and let it grow. In that way, it's more like a traditional IRA than anything else.

With you paying income tax on any withdrawal not related to medical needs, you'll feel a little like you're dealing with an IRA. The big difference is that you won't have to deal with any of the mandatory disbursements that are often required when you have a traditional IRA.

If you don't need the money for healthcare, you won't be throwing it down the drain. It can benefit you long beyond the time when you need it for healthcare spending.

If you haven't had the chance to save much for retirement, this can be an added bonus.

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