Comment on There is a fee to close my HSA account

disguy_ovahea@lemmy.world ⁨4⁩ ⁨days⁩ ago

• phdepressed@sh.itjust.works ⁨4⁩ ⁨days⁩ ago

  That’s FSAs.

  HSA funds continue growing so long as you aren’t using them. If you’re healthy and actually middle class or better they act as a 3rd retirement vehicle, since after 65 you can use it for whatever and they don’t penalize you.

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  • COASTER1921@lemmy.ml ⁨4⁩ ⁨days⁩ ago

    Exactly this, they’re best used as a tax free investment account rather than anything health related. If you’re on a plan with high enough a deductable to be eligible for an HSA and can afford it you should max out your HSA contributions before even a penny of unmatched 401k contributions. Personally I’d argue that you’re better off maxing out the HSA and using post-tax money to pay medical expenses unless close to the end of your career. It’s one of it not the single most easily taken advantage of ways to not pay tax at all on a long term investment.

    The system is indeed stupid but the least you can do is take advantage of it where possible and for the middle class the HSA is one of the best ways.

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    • ieatpillowtags@lemm.ee ⁨4⁩ ⁨days⁩ ago

      Why is it better than unmatched 401k?

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      • tburkhol@lemmy.world ⁨4⁩ ⁨days⁩ ago

        Once you hit 65, you can withdraw HSA funds for any purpose, tax free, like a Roth IRA. 401k withdrawals will be taxed as ordinary income, so an HSA dollar is worth about $1.20 in a 401k.

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      • AA5B@lemmy.world ⁨4⁩ ⁨days⁩ ago

        401k money is taxable as regular income on withdrawal. The expectation is you will be in a lower tax bracket after retiring, so you win.

        HSA is not taxable, although I don’t know if that’s just when used for medical expenses

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  • Sergio@slrpnk.net ⁨4⁩ ⁨days⁩ ago

    You know, I can look up the definitions of HSA and FSA and things like that, and I can have the definitions right there in a document on my screen, but they still don’t make any sense to me in terms of how they relate to me specifically. A lot of times they seem like they depend on me predicting things in the future that are unknowable, like my future health or how and where I will be billed for something. And that’s assuming I also look up related terms like APY and deductible and figure out what those mean. If I ask any HR people they’re like “just contact the provider for an explanation” and I’m like yeah, I totally want to deal with the phone menus and hold times of some faceless corporation, just to have them pull some BS like OP’s talking about.

    Sorry about the rant. I guess that’s what I find mildly infuriating.

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    • jacksilver@lemmy.world ⁨2⁩ ⁨days⁩ ago

      To simplify both posts below:

      • FSA: good if you know you’re going to have $2-3k+ medical expenses and want to use tax deffered money.

      • HSA: good if you want to save tax deffered money year over year (and don’t mind having a high deductible insurance plan)

      • additionally, some people use HSAs as an investment for retirement.

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    • bitchkat@lemmy.world ⁨4⁩ ⁨days⁩ ago

      The main difference is FSA is use it or lose it. I got Lasik many years ago because I had 1 month to use $2000 in my FSA.

      HSA is like a 401k that you can deduct from immediately for medical needs.

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    • phdepressed@sh.itjust.works ⁨4⁩ ⁨days⁩ ago

      FSAs do depend on you kinda predicting or hedging bets against your own health since they only last the year. You can also use them to buy certain health/exercise equipment though.

      HSAs can often be invested (in stock market) thus act like an IRA with extra tax avoidance if you manage not to use it for long enough. It’s counter to the stated purpose but it’s basically better to not withdraw or reimburse from it unless you need to.

      Deductibles are Deductibles. How much you have to pay before insurance “kicks in”. There are per visit deductibles and yearly deductibles which are as they sound. HSAs are only available to plans with high deductibles. FSAs are available to plans that aren’t just high deductible.

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  • disguy_ovahea@lemmy.world ⁨4⁩ ⁨days⁩ ago

    I switched off of the family HSA plan after two years of paying out of pocket at the end of the term. It depends on the customer.

    Regardless, the interest rates are abysmal.

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    • rimmedalpha@lemmynsfw.com ⁨4⁩ ⁨days⁩ ago

      Yes, but most HSAs let you invest in index funds so it becomes like another IRA.

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    • bitchkat@lemmy.world ⁨4⁩ ⁨days⁩ ago

      But now you’re paying your bills with post tax dollars instead of pretax.

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