This video explains how Health Savings Accounts (HSAs) offer a triple tax advantage for wealth building. The speakers detail how to contribute to an HSA, qualify for a plan, invest the funds, and utilize advanced strategies for maximizing tax benefits and long-term growth.
Triple Tax Advantage: HSAs provide a tax deduction for contributions, tax-free growth on investments, and tax-free withdrawals for qualified medical expenses. This contrasts with Roth IRAs (tax paid upfront, tax-free withdrawals) and 401(k)s (tax-deductible contributions, taxable withdrawals).
Contribution Limits & Eligibility: Contribution limits vary based on marital status (e.g., $4,300 single, $8,550 married in 2025). Eligibility requires a high-deductible health plan; however, most bronze plans now qualify.
Investment Strategies: HSAs can be invested beyond traditional stocks and bonds. Self-directed HSAs allow investment in alternative assets like real estate, cryptocurrency, and even livestock.
Reimbursement Strategies: Taxpayers can track medical expenses and reimburse themselves from their HSA later, even years after the expenses were incurred. This allows for tax-advantaged compounding of the HSA funds.
Advanced Strategies: The video touches upon utilizing HSAs for long-term care expenses and service animal costs. Specific regulations and requirements should be confirmed with a qualified professional.
