The important connection between HSAs and a successful retirement

Health savings accounts are popular health benefit plans, but did you know they can also play a critical role in retirement savings?

Helping employees plan for retirement health care costs is critical to their long-term financial well-being. Fortunately, there’s a savings vehicle that can help solve for both current and future health care needs: the health savings account (HSA).

Use the insights and resources below to deepen your conversations with employers about health care costs in retirement and the potential uses of HSAs.

What is an HSA?

A health savings account (HSA) is a tax-advantaged trust or custodial account created for the benefit of a qualified individual. HSAs can be an integral part of retirement planning since the funds can be invested long-term.

Three reasons to talk with your clients about the retirement benefits of HSAs

Health care is employees’ single biggest retirement expenditure

Retirement health care costs are one of the most significant sources of concern. For good reason: The average healthy 65-year old couple retiring this year can expect to pay $363,946 ($537,334 future value) in lifetime Medicare and supplemental insurance premiums and out-of-pocket costs.¹

Health savings accounts can be an integral part of a retirement plan

In fact, 75% of employers view HSAs as part of their retirement benefits strategy.² Plus, HSAs are triple tax-advantaged and can help reduce employers’ current health care costs.

Few people use health savings accounts as a retirement savings tool

The majority of employees use their health savings account funds for current health care needs, large and small.³ Only 8% of employees focus on saving their HSA funds for future health care expenses.³ There’s a need for more education and awareness of the value HSAs provide as part of a holistic retirement plan.

Use our Retirement Wellness Planner to connect your HSA with your other retirement accounts

Need some help with your conversations? Use these resources.

For you

The connection between HSAs and retirement saving

What's all the buzz about levelizing retirement plan fees?

Discover the role HSAs can play in long-term health care saving and retirement wellness.

Download the presentation

Use with employees

Retirement wellness planner

Track your HSA alongside your other retirement accounts for a better picture of your overall financial health.

View the tool

HSA eligibility calculator

Answer a few quick questions to see if you meet the requirements for having an HSA.

Visit the calculator

Use with employers

Saving for health and retirement readiness

For employers, HSAs make efficient use of your entire benefits package by covering both health and retirement. Find out how.

Download the presentation

HSA max contribution calculator

Calculate how much you may be able to contribute this year to an HSA.

Visit the calculator

¹ HealthView Services, 2018 Retirement Health Care Costs Data Report.
² 2018 Plan Sponsor Council of America survey.
³ Willis Towers Watson 2018 Health Account Employee Attitudes Survey, January 2019. Principal does not make available products related to Health Savings Accounts

Principal^®does not make available products related to health savings accounts.

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The subject matter in this communication is educational only and provided with the understanding that Principal^® is not rendering legal, accounting, investment advice or tax advice. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, investment or accounting obligations and requirements.

Insurance products and plan administrative services provided through Principal Life Insurance Co., a member of the Principal Financial Group^®, Des Moines, IA 50392.