Paying for healthcare costs isn't easy. Even going to a doctor for a routine checkup can be pricey. However, there are ways to make healthcare more affordable.

One method is to contribute to an HSA.

What is an HSA?

HSA stands for health savings account. It's a unique tax-advantaged account that allows you to set aside money to offset healthcare costs every year. The amount you contribute rolls over every year. Not only that, but it generates interest.

Over time, an HSA can grow into a sizeable medical fund covering a wide range of expenses. If you're thinking, "How much can I contribute to my HSA?" Keep reading.

How Does an HSA Lower Healthcare Costs?

An HSA lets you contribute pre-tax income. Furthermore, your withdrawals to pay for qualifying medical expenses are tax-free. The same goes for any interest the HSA generates.

You benefit from instant savings on your overall healthcare costs by eliminating taxes from the equation.

Keep in mind, however, that there are tradeoffs. To be HSA-elidible, you must have a high deductible health plan (HDHP). With an HDHP, your monthly premiums are lower. But, the deductible you must pay before coverage kicks in is higher.

An HSA provides a much-needed buffer. You can keep your insurance premiums low while contributing to an HSA to cover your deductible if a sudden medical emergency or other expense occurs.

How Much Can I Contribute to My HSA?

The IRS sets annual limits on how much you can contribute to your HSA. For 2022, the limit is $3,650 for individuals. If you have a family plan, you can stash up to $7,300 to your HSA in 2022.

Peace of Mind

Having an HSA is an excellent step towards fiscal responsibility. These accounts can stay with you throughout your life, accumulating contributions and gaining interest.

If you ever experience a sudden medical issue, you'll be happy to have the HSA cover those unplanned expenses. They provide peace of mind while helping you stay on top of your healthcare costs.

Read a similar blog about HSA strategy here at this page.