NEW YORK, Feb. 11, 2019 /PRNewswire/ -- HSA administration company, Clarity Benefit Solutions, discusses the underutilized advantages of HSAs.
Health Savings Accounts (HSAs) help employees make tax-free contributions in an account to pay for qualified medical expenses. The earnings within the account are tax free as well, along with withdrawals for all qualifying medical expenses. This makes HSAs an extremely attractive option for employees.
The use of HSAs has grown dramatically over the past few years, as many people are seeing their value. However, industry research shows that users are utilizing all of the advantages of their HSAs.
Many users are not contributing close to the maximum allowed. For example, in 2016, the average HSA contribution was less than $2,000. That year, the individual contribution limit was $3,350 and the family contribution was $6,750. By not contributing anywhere near the maximum, users are missing out on key benefits.
First, HSA balances can be carried over from year to year, unlike Flexible Spending Accounts. Therefore, users can go into the following year with a sizeable nest egg from the year before, without worrying about wasting funds.
Another underutilized feature of HSAs is the ability to invest contributed funds. If you do not anticipate using all of your HSA funds, let some of the balance grow by investing it, that way you have a sizeable fund available in case of an unplanned medical emergency down the line, or to cover Medicare or other long-term care plans. Many people do not know that investing some of their balance is an option, but this option can be extremely beneficial as part of a long-term plan.
If users are in a position to do so, they should seriously consider taking full advantage of their HSA's potential. While enrollment numbers are steadily increasing, the number of people letting additional benefits go underutilized is also growing. Not only are HSAs a way for employees to meet deductibles short term, but making sure they are educated on all underutilized benefits helps them build a better retirement plan.
About Clarity Benefit Solutions: Clarity Benefit Solutions HSA Administration Company provides technology that makes the health insurance plan selection process fast, easy, and straightforward. For over two decades, we have provided clients with industry-leading technology, compliance, and exceptional customer service. Our offering is designed to save time and lower the costs of managing benefits while also promoting employee self-service and automated ACA compliance.
SOURCE Clarity Benefit Solutions