Strategically Using Your HSA as a Retirement Account

A health savings account can provide tax-free health care savings while also serving as a powerful retirement planning tool.

Health savings accounts offer triple tax advantages and potential long-term retirement benefits. everydayplus/Shutterstock

A health savings account (HSA) can help you cover qualified health care expenses tax-free. This may become especially important during retirement. In fact, a 65-year-old retiring today could spend $172,500 on health care in retirement, according to a study by Fidelity Investments.

But beyond its distinct tax benefits, an HSA can also serve as a secret weapon in your retirement savings arsenal. So let’s begin by exploring the basics of an HSA and how to get one.

HSA Benefits

If you have a high-deductible health plan, you can pair it with an HSA. An HSA offers three key tax benefits.