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I have an HSA with company contributions. Now what?

Congratulations! It is a big deal and a big relief to have your company contribute to your health savings account (HSA).

Always remember, this is a tax-free way to save for all your current and future health care expenses. When not used, the money continues to roll over year after year. The other benefit is that an HSA is yours. Forever. It travels with you as an individual if you change jobs or even change health coverage.

Perspective is everything. Thirty percent of employers who offer high-deductible health plans offer no contributions to health savings accounts. Of those companies who do contribute, the average employer contribution for covered workers is $809 for single coverage and $1,412 for family coverage.* Regardless of your circumstance, your goal now is to manage the account in a manner that does two things: a) pays for your medical expenses as they happen and b) creates a safety net of funds should an accident, event or sickness impact your family.

HSA

You are eligible to contribute to an HSA if you are:

  • Covered under a high-deductible health plan (HDHP)

  • Not also covered by a non-HDHP

  • Not enrolled in Medicare

  • Not claimed as a dependent on someone else’s tax return

It sounds impossible, but your job is to try over the course of the year to contribute the maximum you can to the account. Remember, it’s tax-free. Some employers offer incentives like $25 for a wellness checkup or $50 for losing a percentage of weight. If this is the case, take advantage of it. Every penny invested in your account is yours. Each year, the IRS sets a maximum limit for individual or family contributions. Check the IRS website at www.irs.gov to confirm what the current maximums are.

If you find yourself starting an HSA a little later in life, say age 55, you are allowed an extra contribution. The IRS sets the limit for the extra contribution each year. An HSA can only be in one person’s name. It is an individual account—even though it may cover a family. To maximize the catch-up money, if both husband and wife are over 55, open a separate account for the additional contribution amount.

Good luck as you look for every opportunity to contribute to your HSA.