A Health Savings Account (HSA) can be one of the most tax-efficient accounts available—if you use it correctly. With triple tax advantages, HSAs can serve as both a medical spending account and a stealth retirement account.
Triple Tax Advantage
- Tax-deductible contributions
- Tax-free growth
- Tax-free withdrawals for qualified medical expenses
Eligibility & 2025 Limits
You must be covered by a qualifying High-Deductible Health Plan (HDHP). Check the latest IRS contribution limits for 2025, including catch-up contributions for those 55+.
HSA Investment Strategy
- Maintain a cash buffer for near-term medical expenses.
- Invest the remainder in low-cost index funds to compound over decades.
- Save receipts and reimburse yourself tax-free later.
Pro Tip
Pay current medical expenses out of pocket, keep receipts, and let HSA investments grow. You can reimburse yourself in the future tax-free.
Qualified Expenses
Includes doctor visits, prescriptions, dental/vision services, and more. See IRS Publication 502 for a full list.
HSA vs FSA
HSAs roll over year-to-year and can be invested; FSAs are generally use-it-or-lose-it and less flexible.
Track your growing HSA and overall net worth in Vine Wealth Tracking. For tax planning, explore our Tax tools.
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