What Happens When I Make a Contribution to HSA?

When you make a contribution to your Health Savings Account (HSA), you are taking a step towards securing your financial health and well-being. There are a few things that happen when you decide to contribute to your HSA:

Tax Benefits: Your contributions to HSA are tax-deductible, meaning you can reduce your taxable income by the amount you contribute.

Save for Future Medical Expenses: By contributing to your HSA, you are setting aside funds specifically for your future medical expenses.

Investment Potential: Some HSA providers offer the option to invest your HSA funds, allowing you to potentially grow your savings over time.

Easy Access to Funds: With an HSA, you can easily access your funds to pay for qualified medical expenses when needed.

It's important to keep in mind that there are annual contribution limits set by the IRS for HSAs. For 2021, the contribution limit for individuals is $3,600 and for families is $7,200. If you are 55 or older, you can make an additional catch-up contribution of $1,000.

Making contributions to your Health Savings Account (HSA) is not just a financial decision, it's an investment in your future health care needs. Each dollar you contribute is a step closer to better financial security during times of medical need.