Advantages of Health Savings Accounts
As you start thinking about Open Enrollment this fall, you may be considering enrolling in a High Deductible Health Plan (HDHP) for significant savings on health insurance premiums. The best part of the HDHP plan is that you are eligible for a Health Savings Account (HSA). An HSA allows you to save money for qualified medical expenses that you’re expecting, such as contact lenses or monthly prescriptions, as well as unexpected ones —now and in the future.
Why have an HSA?
You own it – The money is yours until you spend it, including Riverside’s contributions of $750-$1000 annually. You keep it, even if you change jobs, health plans or retire.
Tax savings – HSA’s help you plan, save and pay for health care, all while saving on taxes. For example, if you make an annual contribution of $1,200. The annual income tax savings could add up to $452 (25% federal | 5% state | 7.65% FICA)
- The money you deposit is federal income tax-free.
- Savings grow income tax-free.
- Withdrawals for qualified medical expenses are also income tax-free.
It’s not just for doctor visits – Once you’ve contributed to your account, you can use the funds in your HSA to pay for qualified medical expenses such as: Dental care, including extractions and braces, Vision care, including contact lenses, prescription sunglasses and LASIK surgery, Prescription medications and certain over-the-counter drugs, Chiropractic services, Acupuncture, etc.
Save for the future – Your HSA rolls over from year to year, so you can continue to grow your savings and use it in the future – even into retirement.
If you would like to know more, be sure to attend a benefit meeting during Open Enrollment for details and to have all of your questions answered.