HSAs are powerful way to save for retirement - Insurance News | InsuranceNewsNet

InsuranceNewsNet — Your Industry. One Source.™

Sign in
  • Subscribe
  • About
  • Advertise
  • Contact
Home Now reading Newswires
Topics
    • Advisor News
    • Annuity Index
    • Annuity News
    • Companies
    • Earnings
    • Fiduciary
    • From the Field: Expert Insights
    • Health/Employee Benefits
    • Insurance & Financial Fraud
    • INN Magazine
    • Insiders Only
    • Life Insurance News
    • Newswires
    • Property and Casualty
    • Regulation News
    • Sponsored Articles
    • Washington Wire
    • Videos
    • ———
    • About
    • Meet our Editorial Staff
    • Advertise
    • Contact
    • Newsletters
  • Exclusives
  • NewsWires
  • Magazine
  • Newsletters
Sign in or register to be an INNsider.
  • AdvisorNews
  • Annuity News
  • Companies
  • Earnings
  • Fiduciary
  • Health/Employee Benefits
  • Insurance & Financial Fraud
  • INN Exclusives
  • INN Magazine
  • Insurtech
  • Life Insurance News
  • Newswires
  • Property and Casualty
  • Regulation News
  • Sponsored Articles
  • Video
  • Washington Wire
  • Life Insurance
  • Annuities
  • Advisor
  • Health/Benefits
  • Property & Casualty
  • Insurtech
  • About
  • Advertise
  • Contact
  • Editorial Staff

Get Social

  • Facebook
  • X
  • LinkedIn
Newswires
Newswires RSS Get our newsletter
Order Prints
September 28, 2017 Newswires
Share
Share
Post
Email

HSAs are powerful way to save for retirement

Indianapolis Business Journal (IN)

INVESTING

Health savings accounts are one of the most attractive investment vehicles available in the marketplace. An HSA is the savings or investment account that is coupled with a high-deductible health plan.

More people are becoming aware of the triple-tax-advantaged benefits of an HSA: 1) The pre-tax contribution to an HSA is tax deductible; 2) the earnings accumulate tax deferred; 3) withdrawals are tax-free if they are used for qualified health expenses.

Assets in HSAs have tripled since 2012, to $43 billion, and are likely to reach $60 billion by 2019, according to HSA consultant Devenir Group.

While the health insurance industry is in abject disarray, it is almost certain that HSAs will play a central role in the eventual reforms made to the system. The recently failed House and Senate health care bills contained provisions to nearly double HSA contribution limits.

To qualify as an HSA-eligible plan, the high-deductible health plan must have a minimum deductible of $1,300 for a single person or $2,600 for a family. Also, the maximum annual out-of-pocket expenses (deductibles, copayments and other amounts, but not premiums) cannot exceed $6,550 for a single person and $13,100 for family coverage.

In 2017, a family that has an HSAqualified plan can contribute up to $6,750 ($3,400 if single) into an HSA investment account. If account holders are over 55 years of age, they can contribute an additional $1,000, the "catch-up provision," including both spouses in a family plan.

Before age 65, any withdrawals from an HSA that are not used for qualified medical expenses are taxable and subject to a 20 percent penalty. After age 65, any distributions that are not for medical expenses will still incur tax.

And while people often use their HSAs as a spending vehicle to pay for current health care costs, these accounts can, better yet, be used to accumulate significant assets for retirement health costs. Investors with HSAs who can pay for health care costs out-of-pocket and invest the HSA account in the stock market can compound their annual contributions over time, thereby creating another nest egg for retirement. By keeping track of cumulative health expenses paid over the years, the long-term investor can later reimburse himself for those expenses with tax-free withdrawals from his HSA.

Once you obtain health insurance that's a qualified high-deductible health plan, there are several custodians to choose from to establish an HSA account, including HSA Bank, HealthEquity, Optum and Bank of America. It is important to review the various fees and the available investment options offered by these firms. Obviously, it is best to look for low custodial fees and low-fee investment options. Some custodians have a brokerage account feature that allows for investments in individual stocks or other securities.

One of the thoughts behind the HSA was to put the consumer in more control over health costs. HSA premiums were meant to be lower and the deductibles were set higher. The idea was that consumers would shop health care pricing and drive costs lower. However, premiums for HSAs soared under Obamacare, raising the ire of consumers.

With Congress planning to enhance the benefits of HSA accounts, these taxadvantaged accounts are excellent vehicles for investors to provide for their retirement medical costss

Newer

Cantwell, Murray ask Trump to step up aid for Puerto Rico

Advisor News

  • Flourish brings private-bank-like cash solution to MassMutual’s network
  • Majority of Americans concerned recent market highs are unsustainable
  • GLP-1 users choose between medication and retirement saving
  • Gen X and millennials seek new retirement model
  • Are families ready for the costs of aging at home?
More Advisor News

Annuity News

  • New class-action lawsuit targets Delaware Life over annuity disclosures
  • A client remarried: Does their annuity still fit?
  • Gen X and millennials seek new retirement model
  • Global Atlantic names Dan Farrelly head of IMO and IBD channels
  • A rising retirement challenge: The license to spend
More Annuity News

Health/Employee Benefits News

  • NABIP urges Congress to address underlying healthcare costs
  • Understanding health insurance: What fraud, waste, and abuse mean for your healthcare
  • Fairview sues UnitedHealthcare over 2027 Medicare plan info
  • Women can face challenges in obtaining LTCi
  • Health affordability task force considers utility model
Sponsor
More Health/Employee Benefits News

Life Insurance News

  • Life insurance applications rise 15.2% in September, MIB reports
  • Flourish brings private-bank-like cash solution to MassMutual’s network
  • What ‘above and beyond’ means for today’s advisor
  • AM Best Maintains Stable Outlook on Indonesia’s Non-Life Insurance Segment
  • Owings Mills insurance agent pleads guilty to stealing more than $100,000 in life insurance commissions
Sponsor
More Life Insurance News

NEWS INSIDE

  • Companies
  • Earnings
  • Economic News
  • INN Magazine
  • Insurtech News
  • Newswires Feed
  • Regulation News
  • Washington Wire
  • Videos

FEATURED OFFERS

Press Releases

  • Lauren Sinnott Named to Ragan’s Top Women in Marketing Awards, Class of 2026 
  • Classic Car Insurer OpenRoad Insurance Expands to 40 U.S. States in Two Years
  • How Aspire General Turned an Early Technology Bet Into Claims Automation at Scale with Kyber
  • Adjusto launches AI-Native contents claims services powered by its technology platform
  • URL Insurance Group Celebrates 40 Years of Service, Growth, and Industry Leadership
More Press Releases > Add Your Press Release >

How to Write For InsuranceNewsNet

Find out how you can submit content for publishing on our website.
View Guidelines

Topics

  • Advisor News
  • Annuity Index
  • Annuity News
  • Companies
  • Earnings
  • Fiduciary
  • From the Field: Expert Insights
  • Health/Employee Benefits
  • Insurance & Financial Fraud
  • INN Magazine
  • Insiders Only
  • Life Insurance News
  • Newswires
  • Property and Casualty
  • Regulation News
  • Sponsored Articles
  • Washington Wire
  • Videos
  • ———
  • About
  • Meet our Editorial Staff
  • Advertise
  • Contact
  • Newsletters

Top Sections

  • AdvisorNews
  • Annuity News
  • Health/Employee Benefits News
  • InsuranceNewsNet Magazine
  • Life Insurance News
  • Property and Casualty News
  • Washington Wire

Our Company

  • About
  • Advertise
  • Contact
  • Meet our Editorial Staff
  • Magazine Subscription
  • Write for INN

Sign up for our FREE e-Newsletter!

Get breaking news, exclusive stories, and money- making insights straight into your inbox.

select Newsletter Options
Facebook Linkedin Twitter
© 2026 InsuranceNewsNet.com, Inc. All rights reserved.
  • Terms & Conditions
  • Privacy Policy
  • InsuranceNewsNet Magazine

Sign in with your Insider Pro Account

Not registered? Become an Insider Pro.