Understanding HSA Funding: What You Need to Know

When it comes to Health Savings Accounts (HSAs), understanding how they are funded is essential for maximizing the benefits they offer. Here are key points to keep in mind:

1. Contributions to an HSA can be made by both you and your employer.
2. HSA funds can be rolled over from year to year, allowing them to grow over time.
3. Contributions to an HSA are tax-deductible, reducing your taxable income.
4. Individuals aged 55 and older can make additional catch-up contributions to their HSA.

When it comes to Health Savings Accounts (HSAs), understanding how they are funded is essential for maximizing the benefits they offer. Not only can contributions be made by you and your employer, but there are also strategies to ensure that your funds are continuously growing.

1. Contributions to an HSA can be made by both you and your employer, which means you can boost your savings faster.
2. One of the greatest benefits of HSAs is that the funds can roll over from year to year without any restrictions, allowing you to accumulate savings for future healthcare expenses.
3. Additionally, contributions made to an HSA are tax-deductible, effectively lowering your taxable income, which is a fantastic advantage at tax time.
4. If you're aged 55 and older, you can make catch-up contributions to your HSA, enabling you to save even more as you approach retirement.