HSAs: Are They Worth Your Time?

HSAs, or health savings accounts, are pre-tax savings accounts used to pay for medical costs. These accounts are available to any individual whose insurance deductible exceeds $1,400 or any family with a deductible of $2,800. With healthcare costs constantly rising, high deductible policies are becoming much more common in employer-sponsored healthcare plans. If you are on a high deductible medical insurance plan, an HSA can provide a vehicle for you to save on healthcare costs, potentially lower your tax burden, and serve as an emergency savings fund as well. 

HSAs often translate into lower monthly premiums, which can also potentially save you money over the long term. To determine if an HSA might be right for you, consider the following aspects of the account. Speaking with your employer and meeting with an experienced financial planner can also help you make a good choice. Here are five things to consider with HSAs:   

1. Look into an HSA if you don’t have any expensive chronic conditions.

An HSA might be right for you if you don’t have chronic conditions that lead to high yearly medical spending. HSAs can be a desirable option for relatively healthy individuals who may only need to visit a doctor a few times a year. If you have a high deductible that you’re unlikely to meet each year, an HSA is likely a good match. If you routinely meet and exceed an insurance policy’s deductible due to higher medical costs, an HSA might not be the right choice for you. 

2. An HSA might be right for you if your employer offers a contribution plan. 

Many employers now offer an HSA contribution plan for employees who opt in to a high-deductible insurance plan. Put simply, an employer will put aside a predetermined amount into your HSA account each month. Some employers contribute on a sliding scale basis, matching what the employee puts into the account. HSAs can be excellent for employers, because they are often less costly than purchasing a low-deductible plan for that employee. 

3. An HSA can provide greater healthcare flexibility. 

If you’re someone who values choice, autonomy, and control over your healthcare expenses, an HSA could be a solid match for you. Often, people who prefer HSAs cite the freedom they feel to select their own doctors, advocate for specific treatments, and have greater agency over how their money is spent on healthcare. While an HSA does require more intentionality and planning from the account user, the monetary savings can be significant. If you feel comfortable managing your own finances, an HSA could be the way to go for healthcare costs. 

4. HSAs can save you money on taxes. 

One of the key benefits of an HSA is the opportunity to set aside money in a pre-tax account. All HSA contributions, both yours and your employer’s, enter the account before taxes. An HSA can also lower your taxable income by diverting it into a savings account. These funds are used to pay copays, deductible costs, and even costs your healthcare plan doesn’t cover, like eye exams, glasses or contacts, orthodontics, and any dental care. 

5. An HSA can serve as a secondary savings account. 

If your current annual healthcare costs are reasonable, an HSA can serve a secondary purpose: saving for the future. Since HSAs allow medical expenses, this can also be helpful in the event of a sudden injury or illness. Any and all money you’ve saved in an HSA can be used to pay for big ticket healthcare items like surgeries, long-term treatments, or necessary but expensive medications. Your money continues to accrue each year in an HSA, however, since the money is collected pre-tax, it is not subject to income tax, no matter how large it grows. This means that it can be used as a secondary retirement or savings account. In fact, IRAs can be converted into an HSA. Although this type of transfer can only be done once, it allows for even more flexibility when it comes to saving for retirement. 

Medical decisions can be complex. Southwestern Investment Group can help advise you on healthcare spending. If you have any questions about how an HSA could fit into your overall financial plan, contact us to meet with a helpful, experienced financial advisor.

Jeffrey Dobyns
Jeffrey T. Dobyns


President, SageSpring | Financial Advisor, RJFS 

Jeffrey T. Dobyns

President, SageSpring | Financial Advisor, RJFS

Jeff Dobyns has enjoyed extraordinary success providing comprehensive financial planning to retirees, entrepreneurs, entertainers, and executives by taking the time to truly know his clients, understand their goals and develop and execute their ongoing, strategic, financial plans.

Jeff earned his finance degree in business administration from Ohio University and has held executive positions with financial planning firms for more than two decades. After serving as Vice President of Investments of Lykins Financial Group, CPA’s, in his hometown of Westerville, Ohio, Jeff moved to Nashville, Tennessee to found SageSpring Wealth Partners in 2002. As its President, Jeff has led SageSpring to remarkable success, holding the distinction of being one of Raymond James’ top independent contractor offices, and a member of its Chairman’s Council*, every year since 2008.

Jeff’s true calling, however, is working directly with clients, helping them plan their financial futures in a manner that aligns with their values and helps provide them with financial confidence. To help meet these goals, Jeff leads the team of Dobyns Wealth Team and also incorporates the expertise of attorneys, accountants and other professionals to provide quality financial, tax and estate planning, and ongoing asset and risk management.

As independent advisory businesses, neither SageSpring Wealth Partners nor Dobyns Wealth Team hold any assets on behalf of clients, with such custodial and brokerage services being provided by Raymond James. As a leader in wealth management, Raymond James has an exemplary reputation and today serves more than $930 billion in client assets through 8,200 financial advisors worldwide (as of 9/30/2020).

In order to meet the highest standards of professionalism and ethics in the industry, Jeff is a CERTIFIED FINANCIAL PLANNERTM practitioner**, a Chartered Life Underwriter and a Chartered Financial Consultant. Jeff is also a participant of the Dave Ramsey SmartVestor program.

Jeff’s work and personal life are both guided by his faith and the Christian principles of honesty, generosity, compassion, and integrity. Accordingly, Jeff devotes considerable time and resources to a number of causes, including serving as a board member of Men of Valor, a prison ministry and mentoring program. He is also on the advisory board of The Signatry of Middle Tennessee, which works with families to increase their charitable giving to their favorite causes. Additionally, Jeff is on the advisory board for Halftime Institute, an organization that coaches marketplace leaders to discern and engage in their life purpose. Lastly, Jeff serves on the board of the Legacy Center of Nashville, a collaboration of independent coaching resources. He is a past board member of Porter’s Call, a Nashville charity that provides free counseling for musicians and their families, and the Martha O’Bryan Center, which empowers those in poverty to transform their lives through work, education, employment, and fellowship.

Jeff and his wife, Amy, are raising their family in Brentwood where they are members of the Brentwood Baptist Church, and their children, Gracyn, Hunter, and twins Tanner and Logan, attend the Christ Presbyterian Academy. For recreation, Jeff enjoys hunting, fishing and just being outdoors.

* Membership is based on prior fiscal year production. Re-qualification is required annually.

**Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER, CFP® (with plaque design) and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board’s initial and ongoing certification requirements.

SmartVestor is an advertising and referral service for investing professionals (“SmartVestor Pros”) operated by The Lampo Group, LLC d/b/a Ramsey Solutions (“Ramsey Solutions”). Pursuant to an arrangement between Ramsey Solutions, SageSpring Wealth Partners and your advisor, your advisor pays Ramsey Solutions a flat monthly fee to: (a) be a SmartVestor Pro, (b) advertise services through the SmartVestor website, and (c) receive client referrals in the form of an initial introduction to interested consumers who are located in your advisor’s Pros geographic region. SageSpring Wealth Partners does not endorse and are not affiliated with Ramsey Solutions, except with respect to the arrangement described above, and neither Ramsey Solutions nor its agents are officers or employees of SageSpring Wealth Partners. Further, neither Ramsey Solutions nor its agents are authorized to provide investment advice or act in any way on behalf of SageSpring Wealth Partners, except in connection with providing your contact information to your advisor.

Ramsey Solutions’ relationship and agreement is between SageSpring Wealth Partners only. Raymond James Financial Services, Inc. is not affiliated with the solicitor arrangement between Ramsey Solutions and SageSpring Wealth Partners.

Raymond James is not affiliated with any of the organizations mentioned above.