There are many perks to having an HSA. Not only are they a great way to pay for medical expenses and save on taxes, but you can also invest your HSA funds to create a powerful future financial asset.
If you consistently contribute to your HSA, you may think you’re all set. Truth is, investing your HSA can exponentially grow your health savings to use for any future medical expenses, especially in retirement. Remember, just like contributions and payments for qualified medical expenses, your HSA growth and investment earnings are also tax-free.
The numbers vary, but the average American spends over $280,000 on out-of-pocket healthcare costs in retirement. Investing your HSA is just one way to create a more secure future and prepare for any large, unexpected medical costs along the way. And, remember, couples have a higher contribution max at a combined HSA contribution of $7,100.
Let’s say you just started building your HSA at age 40. You start with an investment of your current HSA balance of $3,000 and plan on retiring at 65. If you continue to contribute $3,000 towards your HSA each year without investing and only use about $1,000 on out-of-pocket expenses each year, you’d have a savings of about $60,000. Now let’s take the same scenario but say you decided to invest your original balance of $3,000 at 7%. You’d then have about $172,600 in savings!
As you can see, investing your HSA can have big payoffs in the future. Imagine if you started early, by age 25 instead, for example, you could save upwards of $500,000 But, even if you started a little later, it’s never too late to start saving for retirement. Individuals over the age of 55 can also contribute an extra $1,000 as a “catch-up contribution.”
The MotivHealth HSA Investments platform allows for easy access to investments through your Member Portal. To qualify for investments, you must have at least $2,000 in your HSA.
Want to learn more about investing with us? Call us today! 844-234-4472