A health savings account or HSA, is a great way to save for health care cost today… and into the future.
When you first start contributing to your HSA, your contributions are placed in an FDIC insured account, which earns interest and grows tax-free.
Then, in most cases, when your HSA has a balance of at least $1000 you can begin
investing in a variety of mutual funds. It's like a retirement account for health care,
with the added benefit of being able to withdraw funds for eligible health care expenses at anytime.
According to Fidelity Investments a 65-year-old couple retiring, will need about this much to cover every day medical expenses, not including long-term care insurance throughout retirement.
A diversified group of mutual funds allows you to choose the right mix of funds based on what your most comfortable with.
To determine what's right for you, you'll find all the tools you need to select and manage your investments options online.
You'll be able to research the mutual funds options available to you and select the funds of your choice.
View your investment balances... recent transactions... contributions, and other account information.
You can also set up your account to invest all or a portion of your future contributions in the funds you select.You have the flexibility to distribute
your HSA dollars among the fund choices however you like.
For example, if your minimum required balance is $1000, as long as you maintain this balance, you can continue to invest over this amount.
If you need to pay for an eligible expense that will lower the balance in your FDIC account under $1000,
you can always transfer money from your investment account to your FDIC interest bearing account. Keep in mind that early redemption fees may apply.
