There’s little not to like about a Health Savings Account (HSA). They allow you to invest and withdraw money for health care expenses. The contributions and proceeds are tax free (if used for a wide range of medical/health expenses).
You can sock away quite a bit of money annually in an HSA: For 2021, the annual cap on HSAs will be $3,600 for self-only and $7,200 for family coverage. Better yet, if you don’t use the money, you can keep it.
Not surprisingly, HSAs are becoming more popular, even during the pandemic. According to a Bank of America
One of the best features of an HSA is that you can use the savings for anything, but if you don’t tap the accounts for health-related expenses, you’ll pay income tax on the withdrawals. Still, it’s a great way to supplement your retirement savings while covering out-of-pocket health expenses.