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Managing Your HSA Money

Most people think about their HSA’s primary purpose of paying for out-of-pocket medical expenses and don't give much thought of anything beyond that, but your HSA is like any other asset you may have, it can appreciate and work for you.

 

First of all, you need to keep track of your money.  Keep in mind that it is all your money, whether you put it in or someone else does.  Also, keep in mind that even though you have a plastic card that came with your account, it is a Debit Card, not a Credit Card, you can use it if there is money in your account.  For that reason, you need to keep a running balance of your account and balance from your statements every month.  Most custodians (the financial institution where you have your account) will give you a monthly statement just like any other bank account, that you can use to keep track of the money going in and out.  Also save receipts for any expenses you use your money for, this will come in very handy if the IRS ever wants proof that you used your HSA money for eligible expenses.

 

Speaking of your custodian, you have a choice as to where you have your account.  If your employer contributes to your HSA, they probably will set up an account with a specific financial institution, however, you can have more than one account.  If you don't like the way the account that your employer set up for you handles your money, you can transfer that money into another account.  Things to keep in mind when choosing a custodian for your HSA are: what are the fees, is there a minimum balance required, what is the interest rate, and are there investment options?

 

When you turn 65 you will probably be on Medicare which means that you will no longer be able to deposit money into your HSA, however, you can continue to use and invest the money in your account.  Also at age 65 you can withdraw money for non-medical expenses with no penalty.  Taxes are due on these non-medical withdrawals, so it would be in your best interest to continue to use your HSA only for medical expenses.

 

Hopefully you will see that it is easy to manage your HSA so that you will receive the most benefit from it.  For more advice on managing your HSA to its fullest, contact your financial advisor.

 
 
Contact Information:
Rockford Insurance in Michigan
PO Box 265
Rockford, MI 49341
Phone 616.361.2550
The Rockford Insurance promise that gives peace of mind

Our mission is to make insurance "a promise that gives peace of mind". We understand that insurance is a promise, a promise that when sickness, accident or death occurs, the insurance will provide a source of funds to help make you whole again. The promise isn't only the insurnace policy but also the on-going service and personal care needed during a time such as this.  
Our complete Mission Statement