As Health Insurance Rises, Is an HSA in Your Future?

For years, Americans have been schooled on the benefits of saving: for retirement, for a child's higher education, and even for a rainy day. It's time to add another item to that list: health care.

As insurance premiums and deductibles rise, the need to save specifically for medical costs becomes greater. In 2003, the government created a tax-deductible savings vehicle for medical expenses, called a health savings account (HSA). HSAs are rapidly finding favor with the self-employed and small-business owners.

Anyone can open an HSA, provided they:

HSA Benefits Today ...

HSAs allow account holders to lower their health insurance premiums by purchasing higher-deductible plans. You can tap into your HSA to pay for any "qualified medical expense," including doctor's visits, prescriptions, dental and vision care, and over-the-counter drugs.

All contributions to an HSA are tax deductible and there are no income or phase-out restrictions. The maximums are adjusted for inflation annually. For 2015, singles can contribute up to $3,350 and families can sock away $6,650. The out-of-pocket limits are $6,450 for singles and $12,900 for families.

Additional benefits:

 ... And Tomorrow



Your tax or financial professional can help you determine if an HSA is right for you.

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