Wednesday 29 November 2017

FSA or HSA: How to maximize your health savings

Health savings accounts and flexible spending accounts offer tax-deferred benefits. Here's how to best integrate them into your savings.
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Straight talk from the money editor
Flexible spending accounts and health savings accounts are tax-advantaged plans that allow people to save money to pay for qualified medical expenses. FSAs allow an employee to set aside a portion of earnings to pay for qualified expenses, most commonly for medical and dental bills not paid for by insurance, such as deductibles, co-payments and co-insurance for the employee's health plan. An HSA allows you to spend money on qualified health expenses if you have a high-deductible health plan. You can also pay for medical costs not covered at all by your insurance.
Using tax-favored accounts to pay for medical expenses is a great way to save money by cutting your tax bill. Though there are many similarities between the two plans, there are significant differences. It's worth the time to compare FSA and HSA plans to help you decide which is the best option for your family and you.
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Jim Pavia
Money Editor
@jimpavia

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