3 thoughts on “HSA Account in California – Worth It?”

  1. The Mad Fientist does a great write up about HSAs….essentially cashflow all medical now (keeping all the receipts), then treat it as a Traditional IRA when you retire (cashing in those receipts).


    B/C you aren’t depleting the account, you never drop below the $5k limit you mentioned, so no (minimal) fees and the money has time to sit and compound.

    That’s crazy CA doesn’t recognize HSAs pre-tax! How absurd!

    1. Interesting idea. Seems rather complicated. 🙂 Also — the $5000 limit is also a lie. If you put the $5000 into an investment account in your HSA (i.e. HSA Bank has TD Ameritrade) then if you don’t leave $5000 in the “savings” account (gaining very little interest), you have to pay the fees. I am pretty sure that’s how it works. I’d rather have the opportunity to invest in real ETFs long term vs keep $5000 sitting in the account with less than inflation gains. Since HSAs only let you put $3400 into them a year, it is def possible to get to the point where leaving $5k in the savings account isn’t a big deal – but my HSA account is only $7k so I moved it all over to investments. I’m thinking of avoiding HSAs in the future entirely unless I can figure something clever out (like what you linked to here.) But, man, do you really trust the government will have the same rules around HSAs in 30-40 years? Also — yes, it sucks that CA does not recognize the HSA. And no one talks about that either! It’s ridiculous.

  2. Your HSA can be used against any medical expense, and you get to contribute/use the funds from both of you.

    IF you are going to the doctor, using prescriptions, or doing things like therapy, or dental or eyeglasses, you can write checks out of the account and its all tax free.

    I am too lazy to look it up, but I think at 65 the money becomes tax free for use. ITs like a big roth account.

    Just track your medical expenses, you can pull money out 30 years down the line if you want.

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