Suze Orman TwitterSuze Orman FacebookSuze Orman YouTubeSuze Orman LinkedIn
View Blog & News List

Health Insurance: 3 Reasons You Should Pick the HSA Option

October 01, 2015 at 12:00 AM

About half of large employers now offer a high-deductible health insurance plan (HDHP). I know the mere mention of “high deductible” might send your blood pressure skyward, but please listen to me. For many of you, a HDHP may be the smartest health insurance.

There’s no denying that employers like HDHPs as a way to control ever-rising health insurance costs. But that doesn’t make HDHPs bad for you. It’s important to understand that HDHP plans come with a savings account option, called a Health Savings Account (HSA). And it's the HSA part of the plan that is the key to it all.

Here are three reasons you should seriously consider an HDHP with an HSA.

1.   A lower premium.  If you work for an employer that requires you to pay a part of your monthly health insurance premium, the HDHP will typically have a lower premium than other plans. That makes sense because you’re on the hook for a higher deductible.

2.   Employers typically kick in money to your HSA. The HSA is your own personal savings account that can be used to pay for approved medical costs. Everything from co-pays to deductibles (just not premiums.) Many employers make an annual contribution to an employee’s HSA account. If your employer offers this “seed” money, go through this mental exercise: subtract the amount of the seed from the annual deductible for the plan. I bet you will be surprised that your net out of pocket cost for this “high deductible” plan is not so high now.

3.   HSA savings are a tax bonanza. In addition to your employer’s “seed” contribution to your HSA, you can also contribute to your HSA savings account. The money you contribute comes straight from your paycheck, and is pre-tax, so it reduces your taxable income for the year. Any money you don’t use in a given year to cover medical costs continues to grow tax-free. (There is no use-it-or-lose-it issue to worry about, as you have with a Flexible Savings Account.) And the biggest tax break comes in retirement. Any money you withdraw from your HSA to cover an approved medical expense will be 100% tax-free. Yep, your HSA is the equivalent of a Roth IRA for health care. That is a seriously great deal.

I highly recommend you give a HDHP with an HSA serious consideration.


Tag Cloud

savingsdeath benefit needs for familyreduce monthly paymentpercentage of women widowed 75-84overspend on nights outonly refinance if it paysraise insurance deductiblewives should be involved in retirementbest loan deal University of Illinoisbetter termsvalue moneybuying a carbudgetinsuranceno apologyaffordabilityshorter payback periodFinancial Power of Attorneystudent loan repayment planFederal Stafford loanlow credit scorerefinancedangerous money seasonprotect dependent Employer Matched ContributionMoneycouple financestax refund fraudcut monthly cable billeight month living expense peace of mindretirementunsubsidized Stafford loancar loanUrbana-Champaignsame-sex marriageRevocable Living Trustyours, mine & oursalternative FICO scoredon't derail retirement savingsno tax on withdrawlsnew carquick closingSatisfyingGiftsfraudulent returncar buying mistakescnbc alarm clockNew York LifeRetirement Savingsstore credit cardspay high rate off firstemergency fund savingsdepreciating asset at worst still pay 75% benefitdon't buy wantsritual scheduleenjoy saving not gender specific financing car Conventional loan PMIrequire chore in exchange for allowanceAmy LacyetARM Caution2015 financial roadmapSuze Orman's Money Warsholiday spendinghealthy aging social security not going brokeretain separate credit cardsfinancial independencelong term goalloan necessityMoney-Saving15-year refinance dealFHA loan feesNewtowntitle insuranceAshley SpringerThe Suze Orman ShowSave Us Moneyiffy incomePrime Rate Rise 2015back door Roth IRAloan is giftCollege of Veterinary Medicinebuy homeitemized deductionmultiple lendersschool buy down Financial Advice2016 adjust withholdingfamily save at least $100 monthlynon conventional routeWashingtoncollege graduatepurely financial standpointFinal Goodbyehigh down paymentprotect and provide for minor child Student Loanmarriage inequalitycredit card20% down payment avoid feesface your financial fearOne Wallet At A Timecost of capitalization calculatorFree Debt EliminatorrefundVital DocumentsSuze changed my lifedon't extend mortgage HDHP'sWall Street8 month safety netbuying car 2016low down paymenthome insuranceForbesearn allowanceloved ones dependent on incomeFinancial Awarenessmoney vowshome ownershipkeep a schedulemake saving a pleasureCredit Card Rate Increasedebthome related tax break bonus lowest cost fund optionannual cost of living adjustmentSandy Hook Elementary Schoolreal estate marketignore 6 month grace period long-term care premiumsrising home pricesmax benefit coveredshort term goal real estate mistakesrolloverincrease emergency savingsbill paying prioritiesPersonal Financerequired disclosureAARPno life insurance financially irresponsibleautomatic paymentphysical healthpreexisting condition not coveredmax employer matched 401(k) contributioninsurance mistakerepay student loansallowance taskkids schedule paymentsidentity thefttelevision hostadjust allocations High FICO Score = Better Rateis it true? FICO at least 720Suze Orman Scholarshipcredit utilization rateFederal PLUS loanjuggle multiple financial goalsdebit cardLong Term Care premiumscomparison shoppingget credit cardpoint cost offset by savingsprotect your familyconfident of solutionstrained relationshipSuze Ormanmonthly dental insurance premiumHDHP/HSAhome budget after tax costcompare provider pricingcontribute household expenses FICO credit score credit card mortgage3% debt transferred pay more than minimumbuy home you can affordretirement planaffordable premiumclosing feescalculate dependents annual income needsHow To Build Creditanticipated salaryspeak new goalhigh premiumshealthy retirement weightone credit cardwomen longer life spanpay interest while in schoolWarner Bros Television Groupthree year car loanLTCi ASAPlive below your meansno private loancreate new truthwomen outlive mentaxesAdequate Auto and Home Insurancebe good examplenear historic lowsHoliday Seasonterm insuranceHearthome buying budgetHolidayDurable Power of Attorney for Health Careovercome financial fearsYoung Adult bad decisionsdebt freecan you afford itgift not loanpaid in fullmental healthage appropriate goalsjanuary billsclosing costs 2% of loanGracegraduationHDHP's are good for youno late fee low mileage discountdon't use allowance as bribeLong Term Care shoppingadvice for college graduatesNew american Dream better loan dealsescrowvalentines dayPhyllis Shelton expert long-term careschedule vacation6 month waiting periodpercentage men widowed 75-84pay down car loanpresident Obamauniversal college accessdangerous retirement planworst financial mistakeSuze approvedworkaholicLifestylefinancial concernverify wellness screening and programsteensno sneaking in feesMinor Children higher monthly paymentteens and moneyAuto Savings low-cost index mutual fundno waiting periodhome loan credit score below 740 Jose Rodriguez!00% tuition paid20% equityalways use all paid time offinterest capitalizationmarriage financial responsibilitylower interest ratestudent loan debtRichreferrals 15 year mortgageFiscal Responsibilityhigher insurance deductibledon't ignore open enrollmentget over life insurance phobiaprotect loved ones standard deduction Alarm Clocksetup automatic savings withdrawnot enough life insuranceUS Tax Codemaintain standard of livingdo you need life insuranceincreased auto insurance premiumstudent loan repayment estimatoroverspend on giftstax ID thefthealthy youloan big picture overspend on dining outtoo expensive schoolpremiumgay marriage ban end Florida 3 savings buckets Eric Dodge write new goaldon't charge a pennynegotiate points with bank or sellerget the most out of social security Credit Card Interest Ratepay down student loan debtHigh Credit Scoresave staycationFixed Rate Mortgagestudent loan repaymentHDHP 8 Rules50 over 50add teenapproved medical 100% tax-freeconsider roth 401(k)mobile appcredit managementhighest possible benefitMotherGoodbyeHDHP's are not badsame sex marriage band end FloridaEmergency Savingshigh credit score discountStaffords this year have a fixed 6.8% interest rateplanHSA tax savingsback-to-school budgetchildren's bookcostly legal 40% toward financial goaldon't defer interest paymentsdon't do five year car loanARMpay off debtonly offered while employed LoveFinancial Awareness Video Festivaldon't spend Changing Livesswitch to spouse coverageCommencementidentity fraudemployer funding HSAExhibitionbalance transfer paying for collegeInvest for savings growthGay Couplesrent vs buyno retirement funds for down paymentdental discount plantake actiondo not pay allowance for good behaviorraise deductiblesgrandchild summer job IRA contributionmoney-aware childretirement accountsdeath benefit 20 to 25 times annual incomefile asapMortgage Credit Availability IndexFinancial Educator30 year mortgage healthy retirement blood pressureOverspendingleave a legacyLegal Guardian4 Must Have Documents housing marketFederal Funds Rateteach your child good money habitsresponsibledon't cover cosmetic dentistryFinancial Cliffspecial saving accountteach importance of helping othersmortgage interest tax deductionStudent Debt Crisiswomen long term careForeclosurecompare monthly expensescredit reportdear suzebe true to yourselfbetter loan ratesswitch to roth 401(k)borrowing plan Civil RightsLTCfour steps to retirement savings 20% down paymentsidelinedInfluentialsget health insurancehome buying mistakesmax employee matchclosing disclosureSchool of Social Workno fee transferautomate student loan paymentssummer job match income increase retirement savings20 to 25 times annual incomesocial securitysmall changes become member Prime Rate Increasesuccessburn outBill and Pennylower premiumis it necessaryfederal student loan deferment Money Marketgift up to 14,000Influential Celebrityfinancial argumentspublic service loan forgiveness programage appropriate choreunder 18 financial giftlife insurance name trust as beneficiaryIRA contribution gifted moneyallowanceVeterinary SchoolPBS Specialgrandparent IRA contribution GiftAccuQuote.comdental insurance community collegeemotional stakeshome buying seasonis it kind?insurance yearly reviewFICO Scorecommunity bankMass Mutual2016 adjust estimated taxorigination feesMarlo ThomasFRAopen enrollment review Must Have DocumentsGay Rightspay credit debt ASAPproperty taxAARP Social security calculatorprovider of financial supportUniversity of Floridapublic service career student loan repayment don't blow tax refundlousy investmentno interestno private loansCPI-Wincentives for health care wellness screeningultimate compounding giftemergency fund Fundsprescription tierdream school2015 record year car salesInterestdoctor no longer in networkEasy Life Insurance 3 bucket approachFinancial SystemSelectQuote.comlower overall drug costverify retirement plan with HR or plan sponsorshop online guaranteed level term policycar leasingsavings pleasureinterest on student loansSuze Orman spouse Kathy Travismortgage brokerreduce interest ratestandard rateinitial tax break Revocable Trustno negativitybig results loan no longer than 36monthschildren under 18one annual feeHoliday Shoppinglong term carecollege studentfinancial fearsBankFinancial Solutions For YouLTC shoppingderailed plandental savings planSpendingbad retirement planningBaby Boomerspay 100% cashlet them have 50% controlFinancial Gift Cliffsecured cardCommunication Skills Retirement Incomeroth irastretch out haircut appointmentsresponsible with moneycredit unionTelepicturesretirment savingsmortgagefocus on new truth social security never insolventknow before you owehigh deductible health care planCNBCCory BookerBeautylearn good financial choicessocial work740 credit scoreMost Influential Celebrities Listfinancial goal phraseRoth 401(k)lower mortgage interest8 month emergency fundcontribution avoid burn out401(k) ContributionsBankruptcyautomatic withdraw to savings unexpected expenseAmericans don't use all paid vacation timeStudent Debtreduce withholdingsave moneyWillcommitstay positiveForbes Top 10long-term care adult childrenreplace permanent life insurance with termpush yourself to save more for retirementheartachecharges on credit cardbreakdown projected monthly housing cost20 year level term secure creditwaive home inspection bidkid borrow firstcut monthly cellular billFinancialmanage student loansCredit scoreCiti Simplicity Card 10% donate to charityraise your deductiblebe kind to yourselfwould you decline a bonusPost-Divorcewomen live longerstudentSelfishpaid vacationis it necessary?Stock InvestmentsPay Off Debt Before Retirementexercise reguarlyterm life insurance19 years cash flow problemfocus on needsTeachemployer offered life insurancetraditional vs roth 401(k)10 year repayment plan Sandy Hook PromisepowerfulLong Term Care Insurance financial aidSuze is my biggest mentorlower ratebest interest rates2017 TaxesCOLAfile taxes quicklyconfidentco-sign meet monthly high FICO score401Kborrow each year, capitalization is going to pile up increase retirement contribution rateno splurge mortgage disclosureletter to suzemonthly benefit ETF'szero rate transfer dealsspring summer doctors in networkpositivecostly insurance mistakepermanent life insurancegift grandchild IRA contribution3 step financial road mapfull retirement agelife insurance

View Blog & News List
People First. Then Money. Then Things.
Connect with me on Facebook Connect with me on YouTube Connect with me on Twitter
© 2017 Suze Orman Media Inc. All rights reserved.
 |  Search  |  Sitemap  |  Privacy  |  Terms
Sign Up For E-mail Offers
Open Panel
Close Panel