Note: This is a sponsored post brought to you courtesy of United Healthcare. Any and all opinions implied or directly expressed are my own unless otherwise stated.
You may have noticed that we have been doing a series of posts covering UnitedHealthcare and the different monthly activities that they are offering to win prizes. This month the activity is all about the HSA (Health Savings Account). I have to admit, I had no idea what an HSA was before starting on this post. And I’m sure many of you are in the same boat. So let’s jump in and learn a bit more.
What is an HSA?
In a nutshell it’s a personal bank account to help you save and pay for covered health care services and qualified medical expenses. You own the account, and you, your family, or employer can deposit money into it, like a regular bank account. There is a yearly limit to how much you can deposit, but there is no limit on how much you can save over time. It is tax free! You don’t have to pay federal or, in most cases, state income taxes on deposits you make, money you spend from the account, or interest earned. If you don’t spend all the HSA money in your account in a year’s time, the money rolls over into the next year. It will stay in there until you choose to spend it.
How do you get an HSA?
In order to get one, you must sign up for a high-deductible health care plan that meets the requirements set by the IRS. Check out irs.gov for more information on what the deductible requirements are.
Now you can cash out your HSA at anytime. However, you might end up facing up to a 20% tax on the money you cash out. Since it doesn’t disappear at the end of each year, why not just leave it in there and use it for those unexpected medical emergencies. You really have no idea when one might hit, and as the old wive’s tale goes- Better safe than sorry.
The account is yours now matter whether you stay with the employer who you started the account with or not. So if you move on to a different job, you take your account with you and can continue to add money and use the account to pay for medical bills.
Now you know every month United Healthcare is doing giveaways to help entice people to learn more about what they offer and to expand your healthcare knowledge. This month is a simple quiz called the HSA 101. You can win up to $500! And I’m giving one lucky reader a $100 Amazon gift certificate (thank you UnitedHealthcare for making it possible) just for taking the quiz!