If there’s one thing most people can agree on when it comes to money, it’s probably this: we don’t like to pay taxes.  If there’s a permissible way to avoid a higher tax bill, common sense would tell us that it’s wise to consider it.

A Roth IRA, for example, gives us the potential for tax-free distributions when done according to the tax laws.  And any growth that may occur within a traditional IRA is tax deferred until distribution. 

But what if you could get an up-front tax deduction, as well as tax deferral, AND tax-free distributions?  On this week’s episode of Managing Your Financial Future, our moderator Johnny Dean  talks with “Professor” Rick Plum,  CFP®  about the triple-tax benefits of owning a Health Savings Account….(read more)

LEARN MORE ABOUT: IRA Accounts

INVESTING IN A GOLD IRA: Gold IRA Account

INVESTING IN A SILVER IRA: Silver IRA Account

REVEALED: Best Gold Backed IRA

Health Savings Accounts (HSAs) have become increasingly popular in recent years as a way for individuals to save for future medical expenses while reaping the benefits of tax advantages. One of the biggest advantages of an HSA is the triple tax benefit it provides. This unique feature sets it apart from other savings vehicles and makes it an attractive option for those looking to save for healthcare costs.

The first tax benefit of an HSA is the ability to make tax-deductible contributions. Contributions made to an HSA are tax-deductible, meaning that individuals can lower their taxable income by contributing to their HSA. This can result in significant tax savings, especially for those in higher income tax brackets. For 2021, individuals can contribute up to $3,600 to an HSA, while families can contribute up to $7,200. Those over the age of 55 can also make an additional $1,000 catch-up contribution. This tax-deductible contribution feature makes an HSA an attractive option for those looking to reduce their tax bill while saving for future medical expenses.

The second tax benefit of an HSA is the ability to grow savings tax-free. Unlike traditional savings accounts, the funds in an HSA can be invested in various investment options, such as stocks, bonds, and mutual funds. Any earnings from these investments are tax-free, meaning that individuals can benefit from the compounding growth of their savings without having to worry about paying taxes on the gains each year. This tax-free growth feature can significantly boost the amount of money individuals have available to use for medical expenses in the future.

The third tax benefit of an HSA is the ability to make tax-free withdrawals for qualified medical expenses. Perhaps the most valuable tax benefit of an HSA is the ability to use the funds to pay for a wide range of medical expenses on a tax-free basis. These expenses can include everything from doctor’s visits and prescription medications to dental and vision care. In addition, individuals can also use their HSA funds to pay for long-term care insurance premiums and Medicare premiums on a tax-free basis. This tax-free withdrawal feature provides flexibility and peace of mind to those who are saving for medical expenses in the future.

In conclusion, Health Savings Accounts offer the triple tax benefit of tax-deductible contributions, tax-free growth, and tax-free withdrawals for qualified medical expenses. These tax advantages make an HSA an attractive option for individuals looking to save for healthcare costs while reducing their tax burden. By taking advantage of the unique tax benefits of an HSA, individuals can ensure that they have the resources available to cover their medical expenses both now and in the future.