Health savings accounts (HSAs) were introduced in 2004 and allow individuals to pay for medical services upfront through funds they deposit tax-free into a personal account. A required insurance policy then kicks in for catastrophic expenses. Any unused funds build up from year-to-year and collect interest in the process. [snip]
"Put simply, no other account has the tax advantages that HSAs do," "Throughout the life of an HSA its owners can withdraw funds for medical care tax-free. Because of this, taxpayers should consider fully funding their HSAs first, before other types of retirement accounts."
"With health care costs continuing to outpace wage increases and companies trimming retiree health benefits," said Fidelity Executive Vice President Brad Kimler in a recent release, "financing health care has to be central to retirement planning."
The beauty of HSAs is that they can be used to pay Medicare premiums, out-of-pocket expenses, long-term care insurance premiums, and many long-term care expenses, say researchers. Even better, HSAs can do all of this tax-free.
However, if you don't end up incurring these types of expenses, you can still use your HSA funds for other purposes and pay only regular income tax on your withdrawals after age 65.
[this is how we allow our children to avoid the coming bankruptcy re: medicare, and (finally) begin reducing the run away costs of medical treatment by spending our own money {the missing component that's allowed this asinine situation to grow in the first place}]
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