Medical costs and insurance premiums keep going up. Fortunately, there are some steps you can take to minimize the effects of rising costs. This tip will discuss how Health Savings Accounts (HSAs) can help you manage some of those expenses and save money.  

Let’s start by explaining what an HSA is.

HSA stands for Health Savings Account and is very similar to a personal savings account, but money saved in the account must be used to pay for health care expenses (there is an exception to that, which will be covered in a bit). The good news is this is your money, so you get to control how the funds are spent and for which medical expenses.    

You can open an HSA if you have a high-deductible health plan (HDHP); however, if you’re on Medicare, TRICARE, TRICARE for Life, or are listed as someone else’s dependent for taxes, you can not. If you’re self-employed and have an HDHP, you can get an HSA. If you switch jobs, your HSA stays with you.  

Since we’ve discussed high-deductible health plans, let’s define an HDHP. In 2026, the IRS sets the minimum deductible at $1,700 for individuals or $3,400 for families. The total yearly out-of-pocket costs, including deductibles, copays, and coinsurance, cannot exceed $8,500 for individuals or $17,000 for families.  

There are many benefits to having an HSA.

One of the most notable is the tax savings. HSA contributions are made before taxes, so they’re deducted from your total income when it comes time to file. In 2026, the IRS lets you put in $4,400 for individual coverage or $8,750 for family coverage. If you’re 55 or older, you can add an extra $1,000 each year until you turn 65 or enroll in Medicare. This extra amount is called a catch-up contribution. Money you take out of your HSA is tax-free if you use it for qualified medical expenses, no matter your age. Plus, any money your HSA earns is also tax-free.  

With an HSA, you also save on premiums. Most high-deductible health plans have lower premiums, so you can put your savings into your HSA. Use your HSA to pay for any medical expense, including coinsurance, copays, and your deductible.  

Your HSA is your money. You own all the money in your HSA, even if your employer contributed, and you keep it if you change jobs, lose coverage, or retire. Your balance rolls over yearly and never expires. If you are 65 or older or disabled, you can withdraw funds for non-medical use without penalty.

If you’re interested in opening an HSA* with a debit card to pay for expenses like copays, deductibles, and prescriptions, visit Triangle Credit Union for more information and to schedule an appointment!  

*To be eligible for an HSA, you must be covered by a qualified High‑Deductible Health Plan and meet IRS eligibility requirements. Contribution limits are set annually by the IRS. HSA funds must be used for qualified medical expenses to avoid tax penalties. Consult a tax advisor for information regarding tax treatment. Insured by the NCUA.