HEALTH SAVINGS ACCOUNTS (HSA's)

A recent headline from the Associated Press states that 40 million HSA's will be sold in the next decade!  Why the expected popularity of HSA's?  There are many reasons, but the main ones are reduced premium costs and huge tax advantages.

What is a Health Savings Account?

HSA's are a little like IRA's.  You buy a qualified high deductible health insurance policy that enables you to open a health savings account, into which you can deposit pre-tax dollars.  For 2010 the deposit can be up to $3,050 for individuals and $6,150 for families.  You don't have to deposit a lump sum all at once.  Generally, you'll be able to make monthly deposits by automatic debit.

Once the money is in your account, it's yours to spend - tax-free - on health care.  If you don't use it, your money can remain in the account and grow tax-deferred. If you withdraw money before you reach age 65 for things other than IRS-approved healthcare expenditures, it will be taxed as income and you'll pay a 10% penalty.  At age 65 the penalty vanishes.  At all times the money in the account belongs to you.  If you change jobs you can take it with you. 

Why an HSA?

• To combat the rising cost of healthcare.
• Recent trends in cost-shifting from employers to employees is noticeable, and has employees vested in finding a solution to the problem.
• Reward individuals that efficiently manage their healthcare dollars.
• Desire for individuals to take more control over how medical dollars are spent.
• Provide a lifetime savings vehicle for medical expenses.
• Individuals want to have more control over their financial destiny.
• With an HSA, health insurance plans start looking and costing like other types of insurance such as auto and homeowners insurance. 

For more information on HSA's, click this link: http://www.ustreas.gov/offices/public-affairs/hsa/faq_basics.shtml.   

We offer the best HSA plans available in the marketplace.  Please contact us with any questions on this exciting product!