HSA vs 401(k): Where to defer income for the future
This session will outline key aspects of how Health Savings Accounts (HSAs) and 401(k)s help members save for the future. The session will discussion how to defer dollars from payroll to either solution; how to contribute dollars outside of payroll; and how to best use those dollars in the future.
- [06:17] For 2021, an individual meeting certain requirements can add up to $6,000 to either IRA type or combination of the two depending on their financial pictures. Most people aren’t aware that with an IRA once you reach age 50 in a given year or older, you can add an additional $1000 to that overall contribution limit.
- [08:38] The HSA gives you greater flexibility if you put the contributions into the account the contributions are tax-deferred. If you use it for qualified health expenses at any time after you make the contribution they are tax exempt.
- [10:01] If the employer doesn’t offer an HSA option, the individual member can go into the local credit union and establish the HSA. It gives the credit unions something else to cross-sell with the individual member and really strengthen that relationship.