Do you have a Health Savings Account? If not, you should think about getting one.

Between so many saving accounts and investments, we need to think about saving some money to take care of our health. This is our most valuable good. You can save for a trip or a new car, but you will not enjoy these things if you’re sick or bedridden.

The Credit Stacker brings you this important topic. If you’d like to learn more, stay with us and read this content.

Let’s start from the beginning. A Health Savings Account (HSA) is a saving account designed for health care expenses. It differs from a personal savings account because it is not taxed.

But to open an HSA, you need health insurance. It has to be a specific type of health insurance, called a high-deductible plan. Also, you can’t be claimed as a dependent in anybody else’s tax returns.

So let’s say you can work your HSA and your health insurance plan like this: for minor expenses like a cold or little incident, you can use the money on your health savings account. For big medical bills, like more complex exams or surgeries, you can use your health insurance plan after your deductibles.

The Health Savings Account has a limited annual contribution of $3650 for an individual and $7300 for a family.

More than just a saving account, opening an HSA is a conscious decision to prioritize your health. Maybe you would spend this money on superfluous things instead of the important ones. It is always a responsible decision to save your money, but you for sure needs to check the pros and cons of each account.

We’ll give you five reasons to open your HSA:

The money you put on your HSA is tax-free. This is a great way to save money, even if you can only use it for medical expenses. No matter how healthy you are, you can make use of a complete check-up, or maybe you’ll need a dentist or to use glasses.

It is a triple tax-free advantage sort of account. The money will enter your account before taxes. Once it is there, it will grow tax-free. And when you need to withdraw it, it will also be done with no taxes.

Yes, you can invest and grow the money on your HSA. The is a wide range of mutual funds you can invest in, and it will be tax-free. This way, you can increase your savings for retirement. The Bank Of America even has an educational section about this kind of investment on their website.

If you need to pay for any medical bills, you can withdraw the invested money with no further problems. But remember that you only use this money for out-of-pocket health expenses.

In our future retirement years, we are more likely to have more health expenses and less income. Having a Health Savings Account is one of the best ways to save money for your old age and have fewer worries to enjoy your final years. Even if you are healthy now, years of savings can be handy in the future.

Even if your HSA is single coverage, you can claim your money to pay for the medical bills of a family member. To do this, you have to claim them on your taxes. Imagine how relieved you would feel to be able to pay for your family’s medical bills. No money in the world would pay back their lives. Your savings can save them.

When it comes to your HSA, you can choose how you’ll spend it or not. It is yours to do whatever you think is best. Of course, everything health-related. But you can make research to look for better prices. You can decide if you’ll do an annual check-up or leave it for the following year. It’s up to you and your doctor’s recommendations.

The fact that you won’t pay taxes on your health savings account may seem enough advantage to have one. But it would be best if you weighed some possible disadvantages of it.

The first one is that you can only withdraw the money for health expenses. Well, it makes sense, right? If you decide to take it for any other purpose, you’ll have to pay taxes (like you would in a different kind of savings account). But there are a lot of expenses that classify as health costs, like vision care, dental services, medical props, and a lot more.

Another disadvantage is one hard to predict. If you have high medical expenses, having a high-deductible plan and a health saving account may not be worth it.

Yes, If you have a high-deductible health plan, you can open an HSA any time you want. Sometimes your employer may suggest it, but it doesn’t have to be related to your job. Remember that your health savings account money will be yours even if you get dismissed from your job.

And if you want to know more about financial education, check out our guide on how to improve your personal finances!