If You Have High Deductible Health Insurance, Consider Opening an HSA
Medical Savings Accounts (HSA) are like a contingency fund to cover your medical expenses . If you need to pay for medical care and have not met your deductible, the money you put into HSA will be right for you. And unlike FSA on a use-or-lose basis , money in HSA will be yours forever.
This is why, if you have just signed up for a high deductible health insurance plan, you should consider opening an HSA in order to accept it. While you can just put your savings in a regular bank account, HSA is better because you don’t have to pay taxes on the money that goes into it.
Since high deductible plans tend to have a lower premium, you can budget enough HSA contributions throughout the year to cover your deductible. That way, if you break your leg, you don’t have to come up with thousands of dollars straight away. And whatever money is in the account at the end of the year, it ‘s still yours – so you can keep it for yourself for next year. (You can even withdraw them in cash when you turn 65. ) Watch the video to learn more about how to use HSA to make medical bills less disruptive.
What is HSA? | PlanSource