How Much Can You Save in Your HSA?

One of the key benefits of having a Health Savings Account (HSA) is the ability to save money for your healthcare expenses while enjoying tax advantages. When it comes to saving in your HSA, the amount you can contribute depends on various factors.

Here are some key points to consider:

• For 2021, the annual contribution limits for an individual with self-only coverage is $3,600, and for those with family coverage, it is $7,200.
• If you are 55 or older, you can make an additional 'catch-up' contribution of $1,000 per year.
• Contributions to your HSA are tax-deductible and grow tax-free.
• You can use the funds in your HSA to pay for qualified medical expenses, including deductibles, copayments, and some services not covered by your insurance plan.
• Unused funds in your HSA roll over from year to year, so they are not lost if you don't use them by the end of the year.

By maximizing your contributions to your HSA, you can build up a significant nest egg to cover future healthcare costs and enjoy the tax advantages along the way.

Understanding the potential of your Health Savings Account (HSA) can significantly impact your financial health. Aside from the 2021 limits of $3,600 for individuals and $7,200 for families, these contributions can be a game-changer when it comes to unexpected medical expenses.