10 Reasons You Need an HSA in 2024

We’re all living more empowered lifestyles, and taking control of your own wellness is one of the most empowering moves you can make. Every decision you make culminates in your overall health and wellness, from the foods you eat to your morning meditation routine. Listening to your body and giving it what it needs is crucial.

An HSA can help to put you in control of your health and wellness by making your needs more affordable and helping you budget for the things that matter most. There are countless benefits of HSA accounts and many reasons why you need an HSA in 2024.

1. Necessities Are Getting More Expensive

Although inflation is forecasted to normalize in the coming months, you’ve likely noticed that many of the things you use every day have become substantially more expensive than they were in previous years. Many of us are still rebounding from shocking price increases on everyday goods and services that shot up at the beginning of the pandemic and took a long time to come back down. 

There are some areas where it makes sense to cut costs. Buying store-brand almond milk or generic toilet paper won’t have a negative impact on the quality of your life. Cutting costs on your healthcare needs or skipping your essentials can negatively impact your whole family.

An HSA will help you budget your family’s healthcare needs while allowing your dollars to go further. HSA money is pre-tax. When you place your health and wellness funds into an HSA account, you’re getting more money than you would if you paid for those goods out of pocket. 

2. An HSA Saves You Money

The easiest way to have more money without doing more work is to legally avoid paying taxes on your money. HSA accounts are for pre-tax money for healthcare-related expenses. You don’t have to pay taxes on any money you deposit into your HSA as long as you’re spending it on a qualified healthcare expense. Your healthcare dollars go substantially further when you use an HSA.

3. Your HSA Can Accumulate Interest

An HSA is a savings account, and like all savings accounts, it can accumulate interest. If you regularly make deposits into your HSA, you may be able to rack up a substantial amount of interest over the course of a few years. It may not be an overwhelming amount of interest, but any interest is better than none. 

4. Most Americans Need To Prioritize Their Health

The average American diet is regarded as harmful to overall health. If you feel like you haven’t been making the best choices, an HSA may be the tool you need to help you get started. If you get a Letter of Medical Necessity from your doctor, the horizons on HSA eligibility expand. 

You can use your HSA to purchase things like a gym membership, wearable fitness tracking tech, vitamins, and supplements more affordably. If you’re working toward a healthier you, your HSA can be a push in the right direction.

5. An Increasing Number of Retailers Accept Direct HSA Payment

Having an HSA used to be a hassle. It was nearly impossible to pay for something directly with an HSA account. You were required to make a purchase with your own personal funds and reimburse yourself from your HSA. A lot of people find that idea offputting. When it’s difficult to spend your healthcare funds and reimburse yourself, some people feel like it isn’t worth the effort.

An increasing number of retailers and service providers are accepting direct HSA/FSA payments from an HSA-linked debit card. This simplifies HSA shopping dramatically. You’re able to use your HSA debit card to make an eligible purchase and completely bypass the reimbursement process.

Truemed provides integration for direct HSA/FSA payment for a large number of health and wellness brands. Shopping with a Truemed integrated retailer makes it easy to take control of your wellness at checkout. 

6. Many Americans Work for Themselves

Many Americans are freelance workers, independent contractors, entrepreneurs, and small business owners. You can’t rely on an employer to meet all of your healthcare needs when you’re the one in charge. Your HSA allows you to make health and wellness decisions for yourself by putting you at the helm. 

7. An HSA Can Help You Provide for Your Family

When you have a family relying on you, every dollar adds up quickly. There are a lot of needs to meet, and keeping everyone healthy is one of the most important roles a primary breadwinner plays in a household. 

If you claim a dependent on your taxes, you’re allowed to use your HSA to pay for their health and wellness needs as well as your own. An HSA improves your ability to care for and provide for your children and your spouse. This is true even if you only have single coverage. Their medical expenses qualify, and you’re allowed to share your HSA-eligible goods with them.

If you have school-aged children, your HSA can be a lifesaver. Parents often find themselves purchasing cold medicine and allergy medicine for their children during flu season and the peak of allergy season.

First aid kits and supplies are HSA eligible, and they’re a must in a household with active children. Menstrual supplies are also covered by HSA funds. If you have several children or dependents who menstruate, your HSA can substantially cut costs over the course of the year.

8. HSA Funds Don’t Expire

If you’ve been using a flexible spending account (FSA) you obtained through an employer, you’re likely familiar with the pitfalls of the system. Employers have the option to preserve some of your unused funds at the end of the year, but many don’t. There’s a good chance that your unused FSA funds expire and disappear into thin air.

HSA funds never expire. Every dollar you deposit into your HSA is ready and waiting when you need it, whether it’s three weeks from now or three years from now. Since HSA accounts can accumulate interest, you’re likely to wind up with more money as a result of unused funds. Don’t let anything go to waste — switch from an FSA to an HSA.

9. Your HSA Can Bolster Your Retirement Savings

If you withdraw money from your HSA and use it for an expense that isn’t HSA eligible, you’ll pay a 20% tax penalty on that money because it’s no longer eligible for tax exemption. All the rules change when you turn 65 years old. At that point, you’re allowed to use the funds in your HSA for whatever you want. 

If you regularly make contributions to your HSA account, those contributions will accumulate interest over the course of the next few decades. Your money will grow while it sits in your health savings account. This growth can be helpful if you ever encounter an unplanned hefty medical expense. It can also be helpful when you want to retire and need to fortify your safety net. 

Your patience and careful budgeting can pay off when you finally gain access to pre-tax money that grew over time. Your stored HSA funds can go a long way in helping you meet your healthcare needs when you become an older adult, or it can help you purchase an accessible condo in a nice neighborhood. Use your HSA to plan for the distant future. 

10. You Can Take Your HSA With You

You deserve to feel satisfied and thrive in your career. The urge might strike you to pursue a new opportunity or even go into business for yourself. If you have an FSA through your employer and you’re relying on it to pay for your healthcare needs, it could be tethering you into a situation that’s causing you to miss an opportunity for personal and professional growth.

Your HSA belongs to you, and you can take it with you anywhere. If you change jobs or begin a new solo venture, your HSA will still be there. You won’t lose any of your contributions, and your funds can never expire.

An HSA May Be a Game Changer for You

If you’ve been considering establishing an HSA for yourself, 2024 may be the year to do it. The benefits of HSA saving and spending can improve the quality of your life and help your money go much further. Prioritize the health of your family while taking a proactive approach to your budget. 

Sources:

United States Inflation Rate | Trading Economics

How HSA-eligible plans work | HealthCare.gov

The U.S. diet is deadly. Here are 7 ideas to get Americans eating healthier | NPR

How And Why The Freelance Workforce Is Setting New Records | Forbes