Do you include your HSA in your overall retirement #s

[MooseBucks]

I keep a running spreadsheet with all of our retirement portfolio balances in it (401k, Roth & Trad IRA, along with pension cash balance)...I haven't included our HSA balance but the company that has my 401k shows it under retirement balances. What is your opinion, include or exclude?

[disneysteve]

I don’t count it as retirement money because that is not it’s primary or intended purpose. It is possible that it could end up being used as supplemental
retirement money but that’s just a side issue. I expect the HSA money will
be spent on medical bills.

[dczech09]

I don't see why not. It is an asset, and a lot of people build up the HSA as another retirement account after maxing the other options. Compared to the other retirement accounts, the HSA is likely to be smaller as it is more of a "sinking fund" than it is an accumulation account.

To build off of what disneysteve said - yes, the HSA money will likely (and should) be spent on medical bills. However, the bulk of one's medical bills will likely arise during retirement. The more money that there is in the HSA, the less money that will be taken from traditional retirement accounts to cover medical bills. So in a very real way, the HSA can be an extensive of one's retirement assets.

[cypher1]

I consider HSA a part of my EF since it's only a matter of time for when I have to dip into it for medical expenses.

[MooseBucks]

I don’t count it as retirement money because that is not it’s primary or intended purpose. It is possible that it could end up being used as supplemental
retirement money but that’s just a side issue. I expect the HSA money will
be spent on medical bills.

Recently read in Money mag that medical expenses average ~275k during retirement. I figured during retirement instead of withdrawing from 401k/IRA I'd be using the HSA since it is tax free in, tax free growth, tax free out.

[disneysteve]

Recently read in Money mag that medical expenses average ~275k during retirement. I figured during retirement instead of withdrawing from 401k/IRA I'd be using the HSA since it is tax free in, tax free growth, tax free out.

By that line of thinking, pretty much any money is potentially retirement money. I hope to travel more in retirement. Does that mean my vacation fund is actually part of my retirement portfolio? What about our new car fund? I'm sure we'll buy at least a car or two after retirement.

Seriously, though, I understand why they would count the HSA as retirement money. Because it grows tax free and can be withdrawn tax free in retirement, it has some of the same qualities as a retirement account.

I suppose if the balance of your HSA grows to the point where it is considerably more than you will realistically spend on medical care, it could be thought of as part of your retirement portfolio at that point.

[Goldy]

I don’t include the hsa in my retirement numbers but I don’t have a good reason for not doing it. It’s not a huge amount of money so i view it more like a get out of hospital free card than a retirement boost.

[Gailete]

I wish we could have HSA plans. I do not understand why self-employed people aren't allowed to have them. Of course we probably pay more per year on medical things than we could put into the account anyhow.

[scfr]

I do, sort of. Now that we are older and closer to retirement, what I count as my retirement savings is: All financial assets - generous emergency fund - funds set aside specifically for planned purchases/expenditures.

Medical expenses are no different than other expenses in that they will be paid one way or another, regardless of the source of the funds.

When I was younger I was more particular about what I counted as retirement savings, but the closer we get to retirement the more it all becomes part of the same pot.

I think there are good arguments for doing either (counting a HSA as part of retirement savings or not) depending on how you decide to structure your individual finances, how close you are to retirement, how well your EF is funded, etc.

For a young person with no EF, I would not recommend that they count their HSA as part of their retirement savings.

[scfr]

I wish we could have HSA plans. I do not understand why self-employed people aren't allowed to have them.

When we were funding our HSA, we were self-employed and were eligible. I'm not as up-to-date on eligibility requirements as I used to be, but I'd be surprised if the self-employed were not allowed to have a HSA if they met the other requirements.

[disneysteve]

I do, sort of. Now that we are older and closer to retirement, what I count as my retirement savings is: All financial assets - generous emergency fund - funds set aside specifically for planned purchases/expenditures.

the closer we get to retirement the more it all becomes part of the same pot.

That makes sense. Ultimately, money is money.

We have three large taxable mutual fund accounts. They aren't technically retirement accounts since they aren't held in a 401k, Roth, IRA, 403b, etc., but I have no intention of ever touching that money until retirement. So in reality, they definitely are retirement accounts.