Which Healthcare Account Will Save You More Money? HSA vs HRA vs FSA

There are three different types of healthcare accounts that are designed specifically to give you dollars that will help you pay for healthcare expenses. The Health Savings Account (HSA) is amazing, but would a Health Reimbursement Arrangement (HRA) or a Flex Spending Account (FSA) actually work better for you? We cover the pros and cons of each account in this video so you can better decide which is right for you.
How Medicare and HSAs work (or don't work) together:
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⏰ TIME CODES ⏰
0:00 Different Types of Accounts
0:54 HSA Pros
2:28 HSA Cons
5:22 HRA Cons
6:43 HRA Pros
7:56 FSA Cons
9:19 FSA Pros
10:12 Can You Have More Than One?
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#medicare #theretirementnerds #hsa #retirementnerds #finance
Federal Disclaimer:
We do not offer every plan available in your area. Any information we provide is limited to those plans we do offer in your area. Please contact Medicare.gov or 1-800-MEDICARE to get information on all your options.

[@diannalocke997]

I want to thank you for all your videos! I have learned so much! Big shout out!!! ❤

[@Theretirementnerds]

Thank you so much!!

[@headlibrarian1996]

As a 2% S-corporation owner I can’t participate in an HRA or FSA 😢 Congress needs to fix dumb tax rules like this and make all corporate benefits work the same way regardless of what corporate tax form you file. S-corporations are not really “incorporated partnerships” anymore, as they were envisioned in 1955.

[@NataliaLomnicky]

Feeling the same pain!! My husband and I are small business owners and it’s been so discouraging to not be able to apply for HSA. Health insurance is so expensive when not being used for years with thankfully great health, but rising up in age and now we’re needing to see doctors for everything!! 🤦🏻‍♀️💔🙏🏼

[@ggjr61]

HSA’s are great unless you or a family member on your insurance has serious or continuous medical issues that need the better coverage not available if you have an HSA. Unfortunately you likely could benefit most from having an HSA in retirement too but won’t have one.

[@davidfolts5893]

HSAs are great. One caveat: Consider how large you want the HSA balance to become because while you can use an HSA like a taxable IRA without penalty at age 65 when making withdrawals, you may be short-circuiting your intention to use the HSA tax-free. You become limited in your tax-free withdrawal amount when you reach Medicare by the Part B and Part D premiums and the Part B Deductible amounts if you use a Medicare Supplement plan. Estimate your total drawdowns from the HSA and use that as a guideline so it stays manageable and tax-free. While there is no RMD associated with the HSA like there is for a traditional IRA/ 401k, you probably did not intend to use it that way.

[@ChrisSadowski-pp1np]

Just use it for medical expenses. You obviously can't use it to pay for supplement premiums. If you have HDG you can use it for actual medical expenses. With G or N most of your expenses are already covered, so you can use that money to cover part B premium and pay for dental and vision expenses. If your brave enough to have an advantage plan you can apply it to the many copays you will have with a pay as you go system.

[@davidfolts5893]

@@ChrisSadowski-pp1np Some people accumulate rather large HSAs, which can not be offset by their medical expenses in retirement; the workaround is to be aware of those amounts before that happens. An S&P 500 Index Fund invested in an HSA can become a rather large amount over time.

[@ChrisSadowski-pp1np]

@@davidfolts5893 only 19 percent of people invest their HSA contributions so it's a good situation to be in. Alot of people don't even contribute enough to hit the annual limit. It is projected it will cost the average person about 315000 dollars for medical expenses in retirement so it's good to have the money set aside.

[@firehorsewoman414]

Am asking for opinion here: I contribute the max family amount each year to my HSA since 2004 and have another 12 years to go. I also calculate my dental and vision expenses for the year and put that amount in an FSA. If I have medical expenses, I pay the amount (after insurance) out of pocket, and not from my HSA but I save those receipts. My HSA is invested and I expect to have quite a bit in it when I retire. My plan was to use that money to pay medicare premiums / supplement coverage / and home health care in order to keep living at home rather than a nursing home. Keep in mind most years I incurred medical expenses equal to what was deposited. So I can reimburse myself for those amounts without penalty I believe, but am I not able to use the rest of the account for what I have planned?

[@ChrisSadowski-pp1np]

@@firehorsewoman414 you can't use HSA money to pay for supplement premiums.

[@jessiemartinfostersr.6067]

Hsa , so kind for the irs to tax you while you die ,,,

[@ivettelopez9509]

Hi- would the amount of money earn in the HSA, would it count as income when signed up to Medicare and pay higher premiums?

[@Theretirementnerds]

No, it would not. The only way it would count is if you pulled dollars put for non-qualified expenses. Those dollars count towards your income

[@Retiredmco]

Erik what about a Medicare MSA? Whats your take on it.

[@Theretirementnerds]

Working on that video 🙂

[@Retiredmco]

@@Theretirementnerds THANKS can't wait

[@nicolasrumboll608]

I think I have an FSA for dependants and an HRA in my health insurance. is that possible?

[@Theretirementnerds]

Yes, totally possible. A dependent care FSA and an HRA makes sense!

[@happyappy19931]

The bigger question is why healthcare continues to be so high.

[@jessiemartinfostersr.6067]

CONGRESS IS SO KIND TO US ,,, WE NEED MORE LAWYERS IN CONGRESS , TO DREAM UP ANOTHER WAY TO TAX A BODEARK FENCE POST , WHILE STEALING ALL VALUE OF YOUR DOLLARS. DO BARTER , NO TAXES ...

[@mdnahidseo]

U need a professional KZbin thumbnail designer?