Hsa

[Atretes1]

Is anyone else using an HSA as an extra retirement vehicle? I am maxing out my HSA every year. Saving my medical reciepts and will claim them later in life. I just cash flow current Medical costs and invest all of my HSA funds.

[kork13]

My father has talked about him doing it, singing the praises of how it'll be tax free growth later on. I honestly don't know how any of this works exactly though. I always hear about people holding on to receipts to claim later ... But I've also heard that once you hit a certain age (65?) the receipts don't matter & it's effectively another Roth IRA that can withdrawn anytime without penalty or taxes?

I've never had an HSA, so I've only ever done minimal research to understand how they work, besides being a means of saving for medical expenses under an HDHP.

[ua_guy]

Historically I've used it only for health expenses and I accumulated enough money to start investing a little. You can only contribute when you're actively enrolled in a High Deductible Health Plan. The husband and I haven't signed up for HDHP's in a while because most of the plans and incentives have been leaned-out over the years. Good thing we didn't, because last year he was diagnosed with cancer. That was an expensive year even with lower deductibles and "great" coverage.

[cypher1]

Is anyone else using an HSA as an extra retirement vehicle? I am maxing out my HSA every year. Saving my medical reciepts and will claim them later in life. I just cash flow current Medical costs and invest all of my HSA funds.

I do the same thing each year with my HSA. While the primary usage is for medical expenses, if you're relatively healthy with minimal medical expenses I think investing it is a great option. I only started investing mine 5-6 years ago (up 35%) and started saving receipts the last 4yrs ago. Later on if i need cash, I would consider reimbursing those older receipts.

[Atretes1]

My father has talked about him doing it, singing the praises of how it'll be tax free growth later on. I honestly don't know how any of this works exactly though. I always hear about people holding on to receipts to claim later ... But I've also heard that once you hit a certain age (65?) the receipts don't matter & it's effectively another Roth IRA that can withdrawn anytime without penalty or taxes?

I've never had an HSA, so I've only ever done minimal research to understand how they work, besides being a means of saving for medical expenses under an HDHP.

At age 65 you can withdraw penalty free, but you are taxed at your normal rate. If you have medical receipts you can withdraw it tax free and penalty free.

[disneysteve]

At age 65 you can withdraw penalty free, but you are taxed at your normal rate. If you have medical receipts you can withdraw it tax free and penalty free.

I didn't know you could use old receipts.

[Atretes1]

I didn't know you could use old receipts.

Yes, you can. I guess they could always change that but as of now there is no time limit to claim. I have 5 years of receipts sorted on my google drive so far.

Tentatively, if insurance is generally the same in 7 years. I will use COBRA insurance when I retire at 56. You can claim Cobra premiums for the HSA but not regular insurance premiums. Who knows maybe they will change it by then that I could claim regular insurance premiums that would be nice.

[srblanco7]

Is anyone else using an HSA as an extra retirement vehicle? I am maxing out my HSA every year. Saving my medical reciepts and will claim them later in life. I just cash flow current Medical costs and invest all of my HSA funds.

A great way to leverage the HSA. Colloquially Ive heard this referred to as "triple tax advantaged". Money goes in tax free, grows tax free, and is withdrawn tax free.

High deductible health care plans came about a bit too late in my career for us to set aside meaningful monies, but for those who are younger, it's a great opportunity to grow some meaningful wealth.

[QuarterMillionMan]

I would like to take advantage of an HSA but I don't have a HDHP.

[Atretes1]

A great way to leverage the HSA. Colloquially Ive heard this referred to as "triple tax advantaged". Money goes in tax free, grows tax free, and is withdrawn tax free.

High deductible health care plans came about a bit too late in my career for us to set aside meaningful monies, but for those who are younger, it's a great opportunity to grow some meaningful wealth.

I am retiring early at 56. I have 5 years in an HSA so far with 7.5 years left till retirement. I wont have a lot in there per se compared to other avenues but I like the triple tax advantage and if I don't need it for medical stuff I can use it at 65 anyway. I may have 100k in it by the time I am 56.

[kork13]

I am retiring early at 56. I have 5 years in an HSA so far with 7.5 years left till retirement. I wont have a lot in there per se compared to other avenues but I like the triple tax advantage and if I don't need it for medical stuff I can use it at 65 anyway. I may have 100k in it by the time I am 56.

Someone more knowledge correct me if I'm mistaken ... But I believe that even after you're retired, you can still continue adding to your HSA if you continue to carry a HDHP (like through ACA). So with another 9 years to 65, you could very easily get it up to $200k+.

[Atretes1]

Someone more knowledge correct me if I'm mistaken ... But I believe that even after you're retired, you can still continue adding to your HSA if you continue to carry a HDHP (like through ACA). So with another 9 years to 65, you could very easily get it up to $200k+.

Yes you can if you have an HDHP and are not using medicare. It would depend if I like any of the HDHP when I retire in 7.5 years. I do not like any of them that I can see now and there are only 2 available for me if I were needing it this year.

[Like2Plan]

We’ve never been eligible to contribute to an HSA. (Having coinsurance disqualified us from enrolling in a HDHP.)

A lot of folks using a HDHP continue to pay expenses out of pocket in order to continue to save the HSA funds-- letting the HSA funds grow tax free. I can see how the HSA can be a pretty sweet deal under the right circumstances.
When you get to Medicare age, you can use HSA funds to pay part B premiums (even if they are deducted automatically from your SS check) and also co-pays . But, as Atretes1 noted, you cannot contribute to an HSA if you are on Medicare (also TRICARE or receipt of VA or IHS healthcare benefits within the previous three months).

Link to an article:

https://www.kiplinger.com/article/retirement/t039-c001-s003-hsas-can-reimburse-you-for-medicare-premiums-paid.html

[Atretes1]

We’ve never been eligible to contribute to an HSA. (Having coinsurance disqualified us from enrolling in a HDHP.)

A lot of folks using a HDHP continue to pay expenses out of pocket in order to continue to save the HSA funds-- letting the HSA funds grow tax free. I can see how the HSA can be a pretty sweet deal under the right circumstances.
When you get to Medicare age, you can use HSA funds to pay part B premiums (even if they are deducted automatically from your SS check) and also co-pays . But, as Atretes1 noted, you cannot contribute to an HSA if you are on Medicare (also TRICARE or receipt of VA or IHS healthcare benefits within the previous three months).

Link to an article:
https://www.kiplinger.com/article/re...iums-paid.html

Oh, that's cool I didn't know you could pay for Medicare premiums. When I retire at 56 I'll use cobra insurance for 18 months. You can also claim cobra premiums on the HSA but not regular insurance premiums.

[disneysteve]

Oh, that's cool I didn't know you could pay for Medicare premiums. When I retire at 56 I'll use cobra insurance for 18 months.

Be sure to compare ACA rates. I went on COBRA because my wife was in the midst of some care and I didn’t want to rock the boat but our ACA plan costs half of what COBRA did, $1,000/month less.