When one is getting a health insurance he or she might come across a term called HSA. The full form of HSA is known as Health Savings Account. It helps in saving the medical expenses and also reduces the taxable income of the individual.
The biggest advantage of Health savings accounts is that it has certain tax advantages. This helps the clients in investing the Health Savings Account funds. The money that is there is absolutely tax free. The account of this fund will grow but no tax will be charged on the growth. Even when one withdraws the money he or she does not have to pay any tax.
The income of an individual is normally taxed after he or she contributes to the HSA. So the tax burden is considerably decreased. For example, if one earns $40000 and contributes $3000 to the Health Savings Account then he or she will be taxed on $37000. Therefore the HSA account definitely lowers down the tax burden.
Another very big advantage of Health Savings Account is that one can actually invest these funds. If one wants then he or she can invest in stocks, in the mutual funds and other investment gears available. There are a number of companies present that will help an individual invest the HSA funds in the investment tools that he or she desires.
Why participate in the health insurance open enrollment 2018?
The medical expenses have increased a lot. It is for this reason that most people prefer getting a health insurance plan.Being a part of the open enrollment of 2018 one will be able to get an HSA as well. This does not have the use it or lose it rule. Rather one can use the funds in the days of financial crises and save funds in other times.
It is because of this innumerable number of benefits that getting an HSA is highly recommended.