An HSA (health savings account) is a tax-advantaged account connected to a high-deductible health plan (HDHP). An HSA lets you save money for future medical expenses. HSAs are portable and can be used for retirement savings if not applied to a medical expense.
“It’s important for individuals to understand that an HDHP may not be the best option if they’re expecting large medical bills in a particular year. That’s because, although premiums are lower, it could be difficult to afford the deductible for a costly procedure, even with money in an HSA,” cautions Staton.