Health Savings Accounts- The Affordable Health Insurance Solution
You’ve probably heard about health savings accounts – those tax-protected bank accounts you set up yourself in conjunction with high-deductible, affordable health insurance plans. Today, these accounts are more attractive than ever for a simple reason: many experts are predicting health insurance premiums are going up – way up – as a direct result of the recently passed healthcare law. (Read my blog to learn more about why the new healthcare law will almost certainly raise rates, not lower them, as the law’s backers promised.)
How can you save money? When you deposit money into your HSA account at your bank, savings-and-loan, credit union, etc., you pay no federal income taxes on the money you deposit, your money grows tax-free in the account and there’s no tax on earnings when you tap into it for medical expenses. Then, after you meet your high deductible on your affordable, high-deductible health insurance policy (remember, the higher the deductible, the more affordable the premium), you are covered up to the maximum for that particular policy.
To open an HSA account, you must also have what the law describes as a “high-deductible” health insurance plan. But that “high deductible” can be as low as $1200 for individuals and $2400 for families! You are then allowed to contribute $3050 annually to your HSA if you are an individual or $6150 if you have a family. You can even make an additional $1000 contribution if you are 55 or older. Remember, the HSA contribution is your money: you keep what you do not withdraw for medical expenses. It is not a “use it or lose it” account like the employer plans many of you are familiar with.
In a sense, with Health Savings Accounts, you are paying part of your health insurance premiums to the health insurance company, and part of the premiums to yourself!
With the health insurance industry changing rapidly, it’s critical that you work with a licensed, independent health insurance agent. If you live in Missouri or Illinois, contact the Vincent K. Blair Health Insurance Agency today at 314-961-7777 and I will explain all your affordable health insurance options to you.
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