What are the advantages of an HSA?

There are several advantages to having an HSA:

  • Triple Tax savings: 
    1. Pre-tax contributions lower your taxable income.
    2. Tax-free growth, even on investments.
    3. Tax-free distributions mean you don’t pay taxes when you use HSA dollars to pay for eligible health care expenses.
  • You can contribute: When you contribute to an HSA, you lower your taxable income.
  • Investment opportunities: When your account balance reaches $500, you can invest some or all of your HSA money above that $500 in a variety of investment funds.
  • No “use it or lose it” rule: You don’t have to use all of your HSA money by the end of the year; it carries over from year to year, even after you retire or leave Morgan Stanley.
  • Higher before-tax savings opportunities: With an HSA in 2023, you can contribute up $3,850 per year for individual coverage or $7,750 per year for family coverage and, if you’re age 55+, you can contribute an additional $1,000 to your HSA until you become Medicare-eligible.
  • Portability: You can use it if you switch medical plans in the future and after you leave the Firm. The money in your account follows you wherever you go.
  • Flexibility: You can change or stop your HSA contributions at any point during the year. You also have flexibility as to when you use your HSA funds: now or in the future, including in retirement.
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