Can You Participate in an HSA if You Terminate Employment and FSA?

Participating in a Health Savings Account (HSA), especially after terminating employment and Flexible Spending Account (FSA), can be a common concern for many individuals. It's important to understand the rules and regulations surrounding HSAs to make informed decisions about your healthcare savings.

Upon terminating employment:

• Termination does not affect your ability to keep your existing HSA.
• You can continue to use the remaining balance for eligible medical expenses tax-free.

Regarding an FSA:

• If still employed, terminating an FSA does not impact your HSA eligibility.
• Once both employment and FSA end:
• Continuing HSA contributions may be restricted depending on your new health plan.
• You can still use existing HSA funds for medical expenses.

It's essential to stay informed about HSA regulations and consult with a financial advisor to maximize your healthcare savings post-employment.

When you terminate your employment, it's natural to wonder how it will impact your Health Savings Account (HSA) and whether you can still enjoy the benefits it offers.