The Benefits To Opening A Health Savings Account

Making financial planning part of your essential financial strategy is a wise decision

, regardless of who you are. Those with current health insurance might need to have extra resources available, just in case the insurance doesn't cover all the health expense costs that might health emergencies or more serious issues might incur. This is all the more reason to consider the advantages of have a health savings account. This little extra padding will help with any expenses not covered. The added bonus for employing a health savings account is that it could be tax free for certain qualifying medical expenses. There are many ways to build this account; direct deposit from a paycheck, bank account or a tax refund. Many of these accounts can be monitored online and is an excellent way to keep track of them yourself.

Employers and most health insurance companies have added this service to their list of benefits for employees and policy holders the help them put safety nets in place so emergency health issues and situations will not overwhelm anyone caught by surprise. This is just another way for preparing for the unexpected and this financial resources is also great for high deductibles and will allow you to pay deductibles up front in emergencies.

The standard amount to open a Health Savings Account is usually around a $100 and this includes a no minimum balance fee. Payments into the account can be deposited by your employer, yourself or both, also, all payments that are of a certain amount are tax deductible. This type of plan is easily accessible and manageable online and is fantastic for any future health related expenses that might catch you by surprise. Other account related good news is that these accounts gather interest that is also non taxable. Variable, tiered interest rates are compounded daily and is a great way to built up the amount in the account.

Many plans allow you to carry your balance from one year to the next and this can really benefit you in the long term because it may be a few years before you are hit with a significant health issue that costs you significantly out of pocket and since your account is FDIC insured you know that your money is as safe as any savings account that you have. Monthly statements will keep you informed with the option to receive paper statements through the mail or e-mail statements in your inbox.

The sad truth is that even health insurance might not give you enough protection when needed. With this being said a tax exempt saving account is the wisest way to save for the unexpected expenses of the future. Putting money aside over the years is just good financial planning for the unexpected, especially concerning your health expenses and issues.

by: Ethan Kalvin

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