DayCents

Health Savings Account (HSA)

An HSA is a tax-advantaged account for medical costs, available if you have a high-deductible health plan. It's uniquely triple-tax-free: contributions are deductible, growth is untaxed, and withdrawals for qualified medical expenses are tax-free — no other account does all three.

Unspent HSA money rolls over every year and can be invested, so many savers treat it as a stealth retirement account, paying current medical bills out of pocket and letting the HSA grow. After 65, non-medical withdrawals are taxed like a traditional IRA.