Tell me about Health Savings Accounts?
Answer:
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usually a company benefit, you deposit pretax money withheld from your wages up to a preset amount, then you can claim against it for deductible expenses.copays, glasses, dental work, crutches etc. Only hook is if you dont spend it all you lose whats left at the end of the year. Have to plan carefully.
Only get it if your low maintenance in terms of using health benefits.
A very good information source is www.hsabankusa.com. It is basically a savings account that you use the funds to pay for expenses that usually goes toward your high deductible on your health insurance. However, you can use the money in the HSA for many things not covered by health insurance, too. You also get tax benefits as it is treated like an IRA is when you file your tax return with the IRS. Don't confuse it with a 125 plan that if you don't spend it, you lose it. An HSA account accumulates and grows and can be used as additional retirement income, too.
I agree with "Working Woman". One thing to add is that the money may be grown using simple interest rates or by using equities.
I agree to answer number one, however, there is a discrepancy. The "use it or lose it rule" applies to Flexible Spending Accounts. This is different than a HEalth Savings Account. A health savings account can be taken with you after you leave employment, and the balance actually rolls over from year to year. The trick is, however, you can only have an HSA if you are covered by a qualified high deductible health plan.
basically, an HSA account is one in which the only withdrawals are for medical expenses. you can make contributions to it, and so can your employer. some banks offer HSA debit cards as well. for more information, please visit www.1stsource.com
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