HSA for America

Funding Your HSA = Money in Your Pocket

September 9 , 2009
Vol. 5, Issue 8

Funding your HSA can reduce your taxes now, and allow you to build a tax-favored savings account that can provide choices and opportunity when you find yourself needing medical care – particularly if the health insurance program you are under at the time has a different idea than you do about what kind of care you should receive.

Why Funding Your HSA Now is More Critical Than Ever

First of all – a major confession.  I totally forgot to fund my HSA in 2008.  Don’t ask how this happened, because I honestly don’t have a good explanation.  But I can tell you this – it cost me money this year, and in future years.  The maximum contribution for 2008 for a family was $5800.  Not putting that money into my HSA cost me close to $2000 in extra federal and state income taxes that I otherwise would not have had to pay.  Even more painful is the knowledge that at a moderate 8% growth rate, that money would have been worth over $25,000 by the time I turned 65.  Ouch!.

Hopefully, no one reading this is making the same mistake.  Health Savings Accounts provide a special triple-tax advantage:  you get an immediate tax deduction; you earn tax-deferred growth; and if you use the money to cover a medical expense you get tax-free withdrawals.  For these reasons, you should fund your HSA first, before putting money into a SEP, Roth, IRA, or other savings vehicle.

Why Funding Your HSA Now is More Critical Than Ever

The U.S. debt is now nearly 12 trillion dollars.  This is an almost inconceivable amount of money.  But let’s say you and 100 of your best friends got to go on a spending spree, each of you spending $1 million per day.  How long would it take your group to spend this much money?  Over 300 years (hopefully you can spend some of it on some high-tech longevity treatments…).

No one can continue to borrow greater amounts of money for unlimited time.  At some point, the money will need to be paid back.  And what that means, for most of us, is higher taxes.  (I myself would vote for less government spending, but that doesn’t seem to be in the plans any time soon).

The other uncertainty facing us is the future of healthcare funding and delivery.  Will you still be able to carry an HSA plan through a private insurance company, or will you be covered with everyone else by a single-payer government-run program?  We are certainly pushing hard to keep HSAs and consumer-driven options as part of the solution, but there are many out there who don’t want HSAs to be part of the picture.  In fact, none of the leading proposals currently include HSA plans.

So put away as much money as possible while you can.  This will give you the money to control your own healthcare, should the time come when a government (or insurance company) bureaucrat decides that you do not qualify for a treatment because you are too old or the odds of success are too low.

HSA for America Additional Benefit:  Let Retailers Where You Shop Help You Fund Your HSA

In order to help make funding your HSA even easier, we are proud to announce a special program for our readers called My HSA Rewards.  Now when you shop through major retailers like Barnes & Noble, Target, Starbucks, Netflix, and others, you will automatically earn cash rewards of 0.5% to 25% on your qualifying purchases.  All your earned rewards accumulate and can transfer to your HSA when the amoun totals at least $50.

There is no cost to enroll, and your rewards start accumulating immediately.

Healthcare Solutions

The U.S. has the highest quality healthcare in the world.  Unfortunately, there are many problems with how our system works.  The biggest is the high cost, driven by the fact that no one knows what procedures really do cost, because doctors and hospitals are not transparent with their pricing.  Our employer-based system can also leave people uninsurable if they have pre-existing health problems and lose their job.

We believe that the solution is not in a government-run program, because government responds not to consumer need and price competition, but to special-interest lobbyists.  The inefficiency in government service is apparent whenever we need to renew a driver’s license or deal with the IRS.  Instead, we believe that any solution should have HSAs as their core, and should promote price transparency and competition among insurance companies, and among healthcare providers.

If this is of interest to you, you can read our blog and give your feedback at


To your health and wealth!

Wiley Long
President - HSA for America

P.S. - Next month we'll talk about how to negotiate with healthcare providers to lower the amount of your bill.


HSA for America
749 S. Lemay Ave, Suite A3-116
Fort Collins, CO 80524
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