The first is the current-year tax break of pretax contributions. This is open to any HSA holder regardless of whether or not they use the money immediately or let it accumulate over time. This can serve as another tax break while you are working.
HSAs can also offer another retirement savings option for people who are already maxing out their 401(k) and IRAs.
For people who don’t need to use the money to cover current medical expenses, this money can grow as a “savings account” to cover eligible medical costs in retirement on a tax-free basis, making the HSA a very solid vehicle to accumulate extra money for retirement.
In next blogpost, we will discuss eligible retirement medical costs covered by HSA.