HSA Administrators, Clarity Benefit Solutions, Shares Tips for Maximizing HSA Contributions

NEW YORK, Feb. 19, 2019 /PRNewswire/ -- HSA administrators, Clarity Benefit Solutions, shares tips for employees to utilize to maximize their HSA contributions.

A Health Savings Account (HSA) is a great tool for employees, with many financial benefits. For example, HSA contributions are tax-deductible, the money in those accounts grows at a tax-free rate, and qualified purchases made with these funds are tax-free. The money stays in your account and rolls over from year to year, with no penalties for not using funds. Over time, these small advantages can add up and make a big impact on your savings goals.

HSAs can be even more beneficial when employees make the most of every dollar they contribute. Here are tips for maximizing the impact of your HSA dollars.

Contribute the Maximum Allowed, If You Are Able To. If your primary goal for your HSA is for savings or because you anticipate a lot of out-of-pocket medical expenses in the future, then it is smart to contribute the maximum amount allowed each year. For individuals, the maximum contribution is $3,500 and for families, it is $7,000. If you are over 55 years old, you can make an additional catch-up contribution of $1,000 per year to increase your balance further. This allows you to maximize the amount of your money that is growing tax-free. If the maximum contribution is not reasonable for you, start with a lower amount and slowly increase as your income allows.

Focus on Eligible Expenses. Traditionally, people use HSA money for things like deductibles, copayments, prescriptions, vision, and dental expenses. However, there are other eligible items that you can purchase tax-free using HSA dollars, that you might be already purchasing and paying taxes on. Some of these items include, but are not limited to asthma equipment, crutches, first aid kits, shoe insoles, thermometers, and vitamins.

Invest For The Future. You can invest a portion of your HSA funds in mutual funds to accumulate tax-free growth. If you have a higher income, it might be a good idea to use non-HSA money to pay for manageable healthcare expenses so that you can invest more of your HSA in a safe, tax-free environment.

About Clarity Benefit Solutions: Clarity Benefit Solutions 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

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https://claritybenefitsolutions.com/