Benefits of an HSA

A health savings account, also known as an HSA, is a combination of a tax favored savings account and a high deductible health insurance policy. The money that builds up in the savings account can be used to help cover the cost of the deducible. Once the deductible of the policy is met, the insurance will start paying for health needs. The money that is left within the savings account is yours to keep after all payments are made, and can even earn interest.

There are many benefits of investing in a health savings account, including:

• Just like an IRA, the money that you contribute to your health savings account are 100 percent tax deductible, up to the legal limit (federally). 
• The withdrawals you pay for qualified medical expenses, including both vision and dental, will never be taxed.
• The interest that is earned with the savings account are tax deferred, and if the interest is used to pay for any qualified medical expenses, they are tax free.
• Different from a flexible spending account, or FSA, the money that you do not use in your HSA is not forfeited at the end of the year, it will simply continue to grow, tax deferred. 

In order to take advantage of all the benefits that are provided by an HSA, the savings account is required by law to be combined with a qualified high deductible health insurance policy.

For all of your health insurance needs throughout Sonoma County and to ensure that you have the right amount of coverage, contact Sackett & Associates Insurance Services. As an independent insurance agent, we will work with you to ensure that you have the right amount of protection, all at the right price for your budget.