HSAs can save you a lot of money on various eligible products and services. But, as it turns out, HSA holders are also some of the most-educated spenders in the United States.
The 2018 Alegeus HSA Participant Profile confirmed this for us. However, it also pointed out something else -- despite being shrewd spenders, HSA owners aren't fully utilizing the savings aspect of these accounts.
Intriguing snapshots of HSA users - Mary Beth Franklin, Investment News
These first two articles seem to be aligned. First, Alegeus (a leader in consumer-directed healthcare solutions) released it's research results on HSA participants, and found that those with HSAs are more likely to understand health and financial concepts, make cost/value-based decisions, and save with discipline. They also do more pre-purchase research into what they're buying and better understand when to seek out alternatives.
The second article gives a little insight into consumer demographics, behaviors and fluency. The results found that HSA users are overall healthier, wealthier and wiser than the average worker.
More than half of HSA holders are between 25 and 44, and 60% are college-educated. On top of that, 90% claim to be healthy, and the average household income of an HSA participant is $72,000. The numbers seem to just keep trending in the right direction.
Both articles touch on how HSAs held $45 billion in assets by the end of 2017. The growth trajectory has assets nearly doubling every three years, leaving us with an estimate of $64 billion by the end of 2019. That's a lot of savings...or so you'd think.
HSA users do not see plans as tax savings, retirement tools - Cort Olsen, Employee Benefit Advisor
Despite all of the info above, this article points out that only 13% of HSA holders have invested in their HSA for growth purposes, and even fewer have contributed the maximum amount allowed by the IRS. This adds to the ongoing debate of what consumers are really using their HSA for -- savings or spendings?
The article points out that HSA owners are under-funding their accounts, meaning they're not taking full advantage of the retirement savings potential. Instead, they're using the money to pay for healthcare-related expenses like deductibles and medical products and services. While definitely helpful for those in need, HSAs aren't best used as spending accounts.
Though it seems HSA holders aren't using their HSAs to invest for retirement, the article points out that, on average, HSA holders are more confident in understanding their health insurance coverage and are more likely to have established savings plans and goals.
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