HSA Myths – Have You Misunderstood? Top 6 Myths Explained

HSAs (Health Savings Accounts) Are Not FSAs – Myths and Misinformation Cleared Up

Recently I had a conversation with a wonderful client of mine about adding HSAs to the Employee Benefits Package. I explained what a powerful benefit and financial planning tool they are. She reminded me that they already offer FSAs so they are “all set”. I had assumed she knew the difference. My mistake.

HSAs are Health Savings Accounts. Don’t confuse them with FSA (flexible savings accounts). Totally different animal.

HSA Myth #1: Owners forfeit unused balances at the end of each year.

Fact: Balances are never forfeited and can be used for eligible expenses at any point in the future, as long as there are funds in the account.

Did you know? Fifty-percent of HSA account holders know that they can carry over balances from year to year.1 That means we need to get the word out!

HSA Myth #2: Owners lose their accounts when they leave employment.

Fact: Health Savings Accounts are personal accounts and they’re portable through job changes and into retirement.*

Did you know? Fifty-percent of employees know HSAs are portable.1 Yes, we need to get the word out!

HSA Myth #3: Contribution levels are fixed.

Fact: Account owners can change their pre-tax payroll deduction amount as often as their employer allows throughout the year.**

Did you know? Only 29% of employees know contribution levels can be changed outside of open enrollment.1

HSA Myth #4: Employees can only make contributions to an HSA through payroll deduction.

Fact: Account holders can deposit funds into their HSA via a transfer from their bank account through the online portal, payroll deduction or even personal check.

Only 37% of employees know contributions can be made through multiple methods.1

HSA Myth #5: Employees who don’t open their accounts during open enrollment have to wait until the following year.

Fact: Account owners can open and fund their HSAs as soon as they meet eligibility requirements.

Did you know? Only 22% of employees know they can open an HSA at any time.1

HSA Myth #6: HSA investment options are limited.

Fact: HSA account owners may have access to a robust investment menu, depending on the program.***

Did you know? Only 34% of employees know HSAs offer robust investment options.1

Next step: Let’s discuss if HSAs are right for your company. Book a time below.