If you have a health savings account, or HSA, which is offered in conjunction with high-deductible health care plans, you don’t have to spend your contributions the way you do with an FSA.
That means whatever you sock away in an HSA — plus any growth if your money is invested — can sit there for as long as you want it to. Its gains grow tax-free, and as long as withdrawals are used for qualifying medical expenses, tapping those funds also comes with no tax.
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Basically, this means that if you can afford to pay your medical expenses out-of-pocket now, you could consider leaving your HSA money alone. Then at any point in the future — next month, next year or even down the road in retirement — you can withdraw the money for qualifying health-care costs.
In fact, as long as you hang on to receipts for health-care costs — those you didn’t use FSA or HSA funds to pay yourself back for and did not count toward the medical expense deduction — you can withdraw the money at any point in the future to reimburse yourself.
It’s also worthwhile noting that HSAs are portable, while FSAs are not.
The 2018 contribution HSA limit for individuals is $3,450 and $6,900 for families. Additionally, if you’re age 55 or older, you can put an extra $1,000 in.