Skip to main content

Boost your retirement income with HSA savings

An HSA is a hassle-free tool to help you prepare for future health care costs and retirement, giving you that cushion when you need it.

Health savings checkup Check your HSA balance
""

Your tool for retirement savings

Have you ever thought of your HSA as a tool to boost retirement savings?

​An HSA isn’t just to pay for medical expenses — it is a long-term investment tool that can help you meet your retirement goals.

Enjoy a lifetime of smart savings​

With an HSA, you have money set aside for your medical expenses, so you can avoid dipping into retirement accounts intended for regular expenses.

Plus, after turning 65, you can use your HSA funds for nonqualified expenses. You’ll just pay ordinary income tax on those expenses.​

More tax benefits than other retirement accounts​

With more tax benefits than other retirement accounts, HSAs are a powerful way to build savings for retirement: ​

  • Withdrawals for qualified medical expenses are income tax-free​.
  • Contributions to an HSA are income tax-free​.

Are you prepared for health care costs in retirement?

You may think of your HSA solely as a way to pay for qualified medical expenses, but did you know you can also use it as a savings tool?

Use our health savings checkup tool

How much will you need to cover your medical costs in retirement? Use our retirement checkup tool to make sure you're covered.
 

Calculate your costs

Make a catch-up contribution

Do you know that once you turn 55, you can contribute an additional $1,000 each year to your HSA? It's called a catch-up contribution.
 

Make a contribution

Accelerate your financial wellness

Once your HSA reaches a certain balance, you can potentially accelerate your savings by choosing to invest a portion of your HSA.
 

View investing options

Fill in the gaps of medical costs

HSAs can cover premiums, deductibles, copays and coinsurance in retirement, as well as hundreds of other qualified expenses.
 

View qualified expenses

HSA retirement guide

HSAs and Medicare

HSAs and Medicare work together to help you in retirement. Once you enroll in Medicare, you can no longer contribute to your HSA, but you can still use your HSA to pay for qualified medical expenses, including Medicare premiums.

HSAs can cover premiums, deductibles, copays and coinsurance for:​

  • Part A (hospital and inpatient care)​
  • Part B (doctor and outpatient care)​
  • Part D (prescription drugs)
Learn more

Maximize your savings by investing

Investing HSA dollars has many potential tax benefits and can be an additional way to save for long-term health care expenses and financial goals.

Investing options

Frequently asked questions about HSAs and retirement

No. You can open and contribute to an HSA at age 65 or later as long as you meet HSA eligibility requirements, which are:

  • You’re covered on an HSA-qualified medical plan.
  • You’re not a tax dependent of someone else.
  • You don’t have any conflicting coverage (including enrollment in Medicare). Turning age 65 does not, in and of itself, preclude you from remaining HSA-eligible absent any disqualifying coverage.

Yes. Medicare doesn't offer an HSA-qualifying option. You can't make contributions to your HSA after you enroll in any part of Medicare, even if you're also covered on an HSA-qualifying plan.

Yes. Once you turn 65 or meet Social Security’s definition of disabled, you can take distributions for items that aren’t HSA-qualified without incurring the 20% additional tax (penalty) that is otherwise assessed on nonqualified medical expenses.

You currently have diverse investment options in your HSA, including digitally managed investments from Betterment, self-directed mutual funds and a health savings brokerage account with Schwab. You can choose to invest based on how experienced you are and how involved you want to be in selecting your investments.

I want help investing and don’t want to spend a lot of time managing my portfolio. Can I get help investing?

You may choose to have Betterment manage your investment funds. Betterment is an independent online investment advisor and combines low-cost, tax-efficient investment strategies with technology and personalized advice to help you pursue your financial goals.

Once you answer a few brief questions about your investment goals and priorities, Betterment will build a personalized portfolio of exchange-traded funds (ETFs) with investment mixes and risk levels that are suitable for you.

I have some investment experience and prefer mutual funds. Can I choose my own investments?

You may choose from among a number of preselected mutual funds from nationally recognized fund families. These have been selected to offer a broad and diverse range of investment objectives, with high Morningstar ratings and some of the lowest expense ratios in the industry.

I am comfortable managing my own investments. Can I have the added flexibility?

You may choose to open a health savings brokerage account through Schwab. Find the right investments for you by selecting from thousands of investments. Schwab offers support when you need it with their industry-leading tools and resources.