A health savings (HSA) account is a tax-advantaged medical savings account that allows account holders to save money for the payment of health-care costs for themselves and their families. The money you contribute to your HSA goes in, grows, and comes out income-tax free when used for qualified medical expenses. HSA funds roll over from year to year with no use-it-or-lose-it limits.
HSAs are not only tax-advantaged savings accounts, but individual account holders may invest the funds. As part of your protection plan, they may help avoid depleting a comprehensive retirement package by providing assistance with long-term care insurance premiums and medical expenses.
At the end of the previous meeting, the group decided to review this funding mechanism which is steadily gaining in popularity. Jodi starts the discussion. “Did you know you can use an HSA account as a long-term care funding mechanism?”
Everyone shakes their head.
Doug doesn’t want to upstage Jodi, so he waits to pitch in. “Don’t feel bad. Dad and I also thought you couldn’t use an HSA account to pay long-term care premiums, and we actually have HSAs!”
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