How An HSA Can Be A Lifesaver In Retirement Planning

by John F. Wasik | Originally posted on Forbes

There’s little not to like about a Health Savings Account (HSA). They allow you to invest and withdraw money for health care expenses. The contributions and proceeds are tax free (if used for a wide range of medical/health expenses).

You can sock away quite a bit of money annually in an HSA: For 2021, the annual cap on HSAs will be $3,600 for self-only and $7,200 for family coverage. Better yet, if you don’t use the money, you can keep it.

Not surprisingly, HSAs are becoming more popular, even during the pandemic. According to a Bank of America study of customers using the plans, “average balances in HSAs increased 17% in 2020, with employee contributions jumping 10%. Also, 35% of HSA balances were saved for future use, which is 25% higher than the national average.”

One of the best features of an HSA is that you can…