Health Savings Plan – Where to Get the Best Rate

How much are you paying for health insurance? If you’re like most Americans and your health insurance costs are continuing to rise each year, you may need to look into a cheaper alternative such as a Health Savings Plan.

First, Some Definitions

If you have an IRA, you already understand the basic concept behind this new type of health coverage. Also called a Health Savings Account, this plan is a medical form of an IRA. You put money into your account tax-free, and you use that money to pay for minor health expenses. You combine this with low-cost, high-deductible health insurance to pay for major expenses.

What If I Need the Money For Something Else?

If you withdraw the money from your account to pay for non-medical expenses, you will likely have to pay a penalty.

How Do I Withdraw Money from the Account When I Need It?

You will typically have a debit card or checkbook linked to your account. When you have a medical expense, you pay with that debit card or a check and money is paid from the Health Savings Account.

Money in an IRA Can Increase in Value. Does Money In A Health Account?

Yes, your money can be earning interest and growing for future use.

How Do I Find a Plan to Enroll In?

Before you can sign up for a Health Savings Account, you typically have to set up a High Deductible Health Plan (HDHP) first. Such a plan protects you against catastrophic expenses that would be more than you have in your savings plan. Your goal will be to put enough in your savings plan each year to pay for the deductible on your HDHP plan.

The best way to find this type of health coverage is to go to an insurance comparison website. By filling out a simple online questionnaire, you’ll have access to quotes from multiple A-rated insurance companies and you’ll be able to choose the best policy for you (see link below).

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