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HSA and HDHP: An introduction to health care savings

When it comes to financial hardship, medical bills are usually high on the list of issues for most Americans. A recent study conducted by the New York Times and the Kaiser Family Foundation found that 77% of insured Americans put off vacations or other major household purchases to pay for medical bills. Of those who were insured when the bills were incurred, the study shows that bills for insurance copays, deductibles, or coinsurance was more than they could afford. So, what does that mean? Most of us can't afford our medical expenses. Luckily, if you're enrolled in a high deductible health care plan (HDHP), you may qualify to open a Health Savings Account (HSA). Learn more about what an HSA is and how it may benefit you below.

What is an HSA?

A Health Savings Account is a financial tool used to pay medical bills and can be used as a savings account for future medical expenses. You can contribute to your account each month or on a yearly basis and it builds wealth over time. You can access HSA funds for qualified medical expenses at any time.

What is an HDHP?

HSAs are great tools for many, but there's a catch: You can only open an HSA if you are enrolled in a qualifying high deductible health care plan (HDHP). Having an HDHP means that you need to pay a larger amount of out-of-pocket costs before your insurance plan kicks in, but you pay less in monthly premiums during the year. An HDHP could make sense if you or your family are at a point in life where your average yearly medical expenses are manageable. If you already have a HDHP through your employer, you could use an HSA to start saving for your medical expenses right away.

HSA Benefits

  • It's a form of savings: Think of your HSA as another savings account. You can automatically deposit money into it, and unlike a Flexible Spending Account, the funds you dont' use roll over year-to-year. You won't lose them. HSAs could also play a role in your retirement planning. After you turn 65, you can withdraw cash for non-medical purposes penalty free.
  • It's a form of protection: When you set up your HSA, you're putting a buffer in place so that when you do have medical costs, you have funds available to pay the bills.
  • It's easy: Think of your HSA as another asset in your financial tool box. HSAs are portable. That means that it's not connected to your employer. An HSA is yours – it travels with you throughout your career and into retirement. By opening an HSA you're building a tax-free fund to use for medical expenses at any time in your life.

Health Savings Account Bonus: Open a Thrivent Federal Credit Union Health Savings Account and $50 will be deposited into the Thrivent Share Savings Account. The Thrivent Share Savings account is a requirement for membership in Thrivent Federal Credit Union. To maintain membership, a par value of one share ($1.00) must be kept in the account at all times. If you fall below the par value you have six (6) months to increase the balance or your membership may be terminated. Both the Thrivent Share Savings account and the Health Savings Account must be opened by December 31, 2017. The $50.00 cash bonus will be deposited into the Thrivent Share Savings account after 60 days.

Cash bonus for new Thrivent Rewards Checking account with Thrivent Federal Credit Union; $50.00 cash bonus is earned when you open a new Thrivent Rewards Checking account and establish free online banking and enroll in e-statements within 60 days of account opening. To open and maintain a Thrivent Rewards Checking account, you need to set up direct deposit into any share/share draft account or complete five bill pays and 10 point of sale purchases every month. If the requirements are not maintained, the account will be transferred to a Simply Checking account after a 3-month period. As of September 25, 2017, our Thrivent Rewards Checking account earns an APY of 0.15%.

Offer begins September 1, 2017, and ends December 31, 2017, or until a maximum donation of $25,000 to St. Jude is reached, unless both organizations agree to a higher maximum. Thrivent Federal Credit Union's contribution to St. Jude as a result of this promotion is not tax-deductible by the member. Accounts open for 60 days will receive bonus as a credit within ten (10) business days. Bonus may be reported to the IRS as dividends earned. Limit one (1) bonus offer per new member; must be primary owner on account and cannot be combined with any other offer. Offer is subject to change without notice.