What’s an HSA? HRA? FSA?
what’s an HSA HRA FSA tsa that last one’s easy tsa Pat’s you down at the airport and checks your carry-on bag they don’t have anything to do with health insurance the other three are tools to help you pay for health care services let’s start with the HSA an HSA or health savings account is a smart way to pay for out-of-pocket health care expenses it’s a bank account that can be used alongside certain health plans like high deductible health plans you decide how much money you want to contribute tax-free each pay period sometimes employers will also contribute when you pay for your out-of-pocket health care expenses like doctor’s visits dental services eye exams and eyeglasses prescription drugs and more it’s with tax-free money you’re stretching your health care dollars further if the great thing about an HSA is that you take it with you from job to job the money in the account whether from your employer or yourself is yours to keep and always many people have an HSA but they don’t contribute keep in mind the HSA is a good way to be prepared for health care expenses it’s nice to know your bank account is safe from big expenses because you’ve saved your maximum out-of-pocket amount in an HSA an HRA is very similar to an it stands for health reimbursement account if you have an HRA only your employer contributes money you don’t add a dime your employer determines the out-of-pocket expenses you can cover with your HRA check your benefits materials to learn what your HRA will cover you spend money from your HRA on qualified health care expenses you roll the money over each year but unlike the when you leave your job the leftover money goes back to your employer since you never paid anything lastly we come to the FSA or flexible spending account a health care FSA helps you pay for out-of-pocket health care like doctor’s office visits prescription medications and lab work choose how much money you want to go into your FSA each year and it’ll go into your account in equal installments the money you contribute is pre-tax so you don’t pay taxes on it but make sure you spend the full amount you contribute each year you don’t get to keep leftover money in your account at the end of the year so plan ahead and make sure you get the most out of your dollars now that you’ve learned about all three health care spending account options we hope you’ll take advantage if you can you want to get serious about planning and saving for your future health care expenses planning ahead and making the most of your tax-free money can ultimately help you stretch your healthcare dollars even further.
How to start an HSA
believe funding an HSA is as close to a no-brainer as you can get these days if you’d like to start your own HSA and don’t know where to begin you’ve come to the right place first make sure you qualify to contribute in general you must not be coveredin this simple BB&T worksheet to see if you qualify for an second find a qualifying policy when purchasing health insurance be crystal clear with your agent that you want to purchase an qualifying policy these are the 2019 deductible and out-of-pocket limits along with how much you can contribute for 2019 third find the right custodian for you the custodian manages your account and it’s usually separate from your insurance agent it is responsible for reporting your activity to you and to the IRS there are many custodians available and services vary for example having an debit card will be convenient if you plan to spend on your say but you may want investment options if you’re saving for retirement search is a good place to begin your hunt the due date for contributing to your HSA and your IRA are the same as your text you de which falls on April 18th this year so are you intrigued by the thought of having an extra IRA want to know even more schedule a free initial consult a simply common or going through this link as you know most of our clients are not local so we can be wherever you are at the click of a mouse until next time Cheers.
Why Should I Use a Health Savings Account ?
97% of the people and other team members and using the Ramsey solutions are HSA we offer a PPO but we do not recommend it and what the HSA is for is a great high deductible lower premium because it’s a high deductible health The insurance plan and most of them have a hundred percent coverage once you meet the deductible but the high deductible is five thousand bucks or seven thousand bucks or something like that but once you meet it it’s a hundred percent coverage. The second thing is that after a hundred percent of the checks you make, you are allowed to invest in a savings account. If you have a thousand dollar medical bill and you have just paid for it, then you have to pay for it. for with pre-tax dollars it’s By using the kind of like seven hundred fifty or six hundred and fifty dollars to pay for it, you can get the tax break free by going with your medical bills. The HSA and the savings account itself, so if you can fund that, you may not even know that the fund is just a cheaper premiums.
If you plan to work for that high deductible and cover a hundred percent, then you may be very sick or someone has a chronic illness. You’re always blowing through the deductible and you come out with a cheerleader because it picks up a hundred bucks and then you pick it up a hundred percent later that other time it works out. ‘t use insurance hard at all I haven’t ever had my life knocked on but I mean very few health claims on me and Sharron and even when our kids would go home with the seldom use. Through the deductible and what that means, we just ended up with cheaper premiums, so that’s how it works and what the benefits are. premiums are cheaper on the insuranc Essential but then you can choose if you want to put money into the HSA now I have no money to go through the baby step three. I am already working on it and off the mortgage okay cool then you want to use it as a methodology saving for what I’ve been doing but again I haven’t used it ‘I’ve got almost 150,000 bucks because of the stupid thing I’ve never used, I just keep throwing in the money and there are a few tax-free things to do. So it’s a cool I’m a big fan of the I think it would have solved a lot of things that we have leaned on but instead of some stupid Obamacare stuff we did but I think it was the way to go.