Health spending accounts are like personal bank accounts for your health. Simply put, it’s a way to save money on medical expenses, and it’s tax-free. There are three kinds of accounts: Health savings accounts (HSA), health reimbursement accounts (HRA) and flexible spending accounts (FSA).
Health savings accounts are like a 401(k) retirement account for medical expenses. The catch? You can only have an HSA if enrolled in a high-deductible plan. What you need to know:
A health reimbursement account is a benefit set up by the employer. It’s a fund that pays for medical expenses not covered by the health plan. What you need to know:
A flexible spending account is set up by the employer. They own the account, but the individual decides what expenses can be paid. What makes it flexible? It works with most employer-sponsored health plans. What you need to know:
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Photo Credit: Regan Walsh