HSA Guide

HSA like a pro

Stretch your dollars further and put more money in your pocket. Health Savings Accounts empower you to save more, spend smarter and invest in your healthcare.

What is a Health Savings Account

HSAs are tax-advantaged member-owned accounts that let you save pre-tax¹ dollars for future qualified medical expenses. You can invest² your account—and funds never expire.

Expect Remarkable

24/7 member services

Award-winning mobile app³

Convenient Help Center

Easy account management

Am I eligible for a Health Savings Account?

HSAs are available exclusively to those with a qualifying health plan.

You are eligible if you have a High-deductible health plan

You are not eligible if you have Healthcare coverage beyond qualified health plans (including Medicare enrollment)

You are not eligible if you are Being claimed as a dependent on someone’s tax returns

You are not eligible if you are Receiving Veterans Affairs benefits within the past three months

Save

Put more money in your pocket

Enjoy lower health plan premiums

Qualified health plans offer lower premiums, enabling you to save potentially thousands every year.

Try our health plan comparison tool

Keep your premium savings

Just put the extra money you would’ve paid toward traditional premiums into your account. Voila! Long-term savings.

Take advantage of triple-tax savings¹

See how much you could save next year

Make pre-tax payroll contributions
Grow tax-free earnings
Enjoy tax-free distributions for qualified medical expenses

See how much you could save next year

FSA	HSA
FSA	HSA
Traditional health plan	HSA-qualified health plan
Higher premiums	Lower premiums
Lower deductibles	Higher deductibles
Not investable	Investable
Funds expire	Funds don’t expire

Roll over funds

Unlike Flexible Spending Accounts (FSA), you own your HSA. That means your entire balance rolls over every year—even if you change health plans, retire, or leave your employer.

Compare healthcare accounts

Roll over funds

Unlike Flexible Spending Accounts (FSA), you own your HSA. That means your entire balance rolls over every year—even if you change health plans, retire, or leave your employer.

FSA	HSA
FSA	HSA
Traditional health plan	HSA-qualified health plan
Higher premiums	Lower premiums
Lower deductibles	Higher deductibles
Not investable	Investable
Funds expire	Funds don’t expire

Compare healthcare accounts

The more you contribute, the more you save

Each contribution potentially reduces your annual tax bill.¹ Link a bank account and make tax-deductible contributions anytime.

HSA Annual Contribution Limits

Tax year	Individual coverage limit	Family coverage limit	Annual Employer Contribution
2024	$4,150	$8,300	Up to $750⁸
2025	$4,300	$8,550

Tax year

Individual coverage limit

Family coverage limit

Annual Employer Contribution

2024

$4,150

$8,300

Up to

$750⁸

2025

$4,300

$8,550

At age 55, members can contribute an additional $1,000 beyond IRS limits.

HSA Annual Contribution Limits

Tax year	Individual coverage limit
2024	$4,150
2025	$4,300

Tax year	Family coverage limit
2024	$8,300
2025	$8,550

Tax year	Annual Employer Contribution
2021	Up to $750⁸
2022

Tax year

Annual Employer Contribution

2021

Up to

$750⁸

2022

At age 55, members can contribute an additional $1,000 beyond IRS limits.

View all HSA limits and guidelines

Spend

Stretch your dollars further

HSA qualified medical expenses

Because of the tax savings on contributions, you can save an average of 30 percent⁴ on qualified medical expenses, including but not limited to:

Acne Medicine
Braces
Crutches
Denturist
Eyeglasses^Rx
Eye Surgery
Flu Shot
Hearing Aids
Motorized Wheelchair
Prescriptions^Rx
X-Rays

Allergy Medicines
Contact Lenses^Rx
Dental Cleanings
Doctor Fees
Eye Exams
Face Masks
Hand Sanitizer^LMN
Ibuprofen
Orthodontia
Sanitizing Wipes

Discover all the ways to spend your HSA

Your savings can add up fast

Here’s an example based on $4,000 annual spending and a 30 percent effective tax rate.

Medical expenses
$3,000

Vision expenses
$500

Dental expenses
$500

Annual tax savings⁴

$1,200

Become a savvy healthcare consumer

We make it easy to save at the doctor’s office and pharmacy. Here are a few strategies to help save even more.

Consider generics

Generic medications cost 20 to 70 percent less than branded medications.⁵

Prefer urgent care

Emergency room visits cost up to 5X more than urgent care.⁶ Unless it’s a life-threatening event, consider urgent care instead.

Comparison shop

Whether you need a simple procedure or even major surgery, be sure to get prices from several healthcare providers.

Consider generics

Generic medications cost 20 to 70 percent less than branded medications.⁵

Prefer urgent care

Emergency room visits cost up to 5X more than urgent care.⁶ Unless it’s a life-threatening event, consider urgent care instead.

Comparison shop

Whether you need a simple procedure or even major surgery, be sure to get prices from several healthcare providers.

Invest

Build long-term health savings

Your retirement engine

Unlike other account types, an HSA lets you invest money to build the ultimate retirement nest egg. To get you there, HealthEquity offers a powerful lineup of low-cost mutual funds,⁷ including index funds and target date funds.

Invest your money just like a 401(k)
Access liquid funds anytime
Enjoy lower fees and transparent pricing

401(k)	HSA
403(b)	HSA
FICA taxed contributions	100% tax-deductible contributions
Tax-free earnings	Tax-free earnings
Medical expenses taxed as ordinary income	Tax-free distribution for medical expenses
Regular expenses taxed as ordinary income	Regular expenses taxed as ordinary income
Minimum distributions requried	No required minimum distributions

HSA vs. 401(K)

Both accounts let you make pre-tax contributions and grow tax-free earnings. But only an HSA lets you take tax-free distributions for qualified medical expenses. After age 65 you can use your health savings account for any expense, you’ll simply pay ordinary income taxes—just like a 401(k) .

HSA vs. 401(k)

401(k)	HSA
401(k)	HSA
FICA taxed contributions	100% tax-deductible contributions
Tax-free earnings	Tax-free earnings
Medical expenses taxed as ordinary income	Tax-free distribution for medical expenses
Regular expenses taxed as ordinary income	Regular expenses taxed as ordinary income
Minimum distributions required	No required minimum distributions

Tools and resources

Check out these additional resources.

HSA webinars

Check out our snackable 15-minute webinars. Each episode gives you simple tips and tricks to get the most from your benefits. Learn how to use an HSA, spend less on healthcare, and invest for the future.

Harness the Power of an HSA

Take control of your health and grow your money. In just 15 minutes you’ll discover how to use a Health Savings Account (HSA) to save on healthcare premiums and build long-term health savings.

12m

Future in focus: Investing your HSA for retirement savings

Your HSA is like a second 401(k). It’s a powerful investment tool. Join us to find out how to invest your HSA and build the ultimate retirement nest egg.

16m

HSA Your Way: Spend, Save and Invest in Your Healthcare

Choosing an HSA is only the first step. Join us to see the power of an HSA in action. We’ll share three strategies for how to spend less on healthcare and invest even more for the future.

11m

¹HSAs are never taxed at a federal income tax level when used appropriately for qualified medical expenses. Also, most states recognize HSA funds as tax-deductible with very few exceptions. Please consult a tax advisor regarding your state’s specific rules.Return to content

²Investments are subject to risk, including the possible loss of the principal invested, and are not FDIC or NCUA insured, or guaranteed by HealthEquity, Inc. Investing through the HealthEquity investment platform is subject to the terms and conditions of the Health Savings Account Custodial Agreement and any applicable investment supplement. Investing may not be suitable for everyone and before making any investments, review the fund’s prospectus.Return to content

³Accounts must be activated via the HealthEquity website in order to use the mobile app.Return to content

⁴The example used is for illustrative purposes only; actual savings may vary. The figure is based on average tax rates, including state, federal and FICA taxes.Return to content

⁵Federal Trade Commission, 2020: Consumer.ftc.gov/articles/0063-generic-drugs-and-low-cost-prescriptions Return to content

⁶Debt.Org, 2020: Debt.org/medical/emergency-room-urgent-care-costs/Return to content

⁷You should carefully consider the investment objectives, risks, charges and expenses of any mutual fund before investing. A prospectus and, if available, a summary prospectus containing this and other important information can be obtained by visiting the Vanguard website at vanguard.com. Please read the prospectus carefully before investing.Return to content

⁸Eligibility and contribution amount may vary based on your health plan selection and other qualifying activities. Please see your plan documents for complete details.Return to content

HealthEquity does not provide legal, tax or financial advice. Always consult a professional when making life-changing decisions.

HSA Guide

HSA like a pro

What is a Health Savings Account

Expect Remarkable

Am I eligible for a Health Savings Account?

How do I sign up?

Save

Enjoy lower health plan premiums

Keep your premium savings

Take advantage of triple-tax savings1

Roll over funds

Roll over funds

The more you contribute, the more you save

HSA Annual Contribution Limits

HSA Annual Contribution Limits

Spend

HSA qualified medical expenses

Your savings can add up fast

$1,200

Become a savvy healthcare consumer

Consider generics

Prefer urgent care

Comparison shop

Consider generics

Prefer urgent care

Comparison shop

Invest

Your retirement engine

HSA vs. 401(K)

HSA vs. 401(k)

Tools and resources

HSA webinars

Take advantage of triple-tax savings¹