ByteOnBikes@slrpnk.net to Mildly Infuriating@lemmy.worldEnglish · 1 year agoThere is a fee to close my HSA accountslrpnk.netexternal-linkmessage-square84linkfedilinkarrow-up11arrow-down10
arrow-up11arrow-down1external-linkThere is a fee to close my HSA accountslrpnk.netByteOnBikes@slrpnk.net to Mildly Infuriating@lemmy.worldEnglish · 1 year agomessage-square84linkfedilink
minus-squareieatpillowtags@lemm.eelinkfedilinkEnglisharrow-up0·1 year agoWhy is it better than unmatched 401k?
minus-squareAA5B@lemmy.worldlinkfedilinkEnglisharrow-up0·1 year ago401k money is taxable as regular income on withdrawal. The expectation is you will be in a lower tax bracket after retiring, so you win. HSA is not taxable, although I don’t know if that’s just when used for medical expenses
minus-squarephdepressed@sh.itjust.workslinkfedilinkEnglisharrow-up0·1 year agoAfter 65 they don’t audit what you withdraw for.
minus-squaretburkhol@lemmy.worldlinkfedilinkEnglisharrow-up0·1 year agoOnce you hit 65, you can withdraw HSA funds for any purpose, tax free, like a Roth IRA. 401k withdrawals will be taxed as ordinary income, so an HSA dollar is worth about $1.20 in a 401k.
Why is it better than unmatched 401k?
401k money is taxable as regular income on withdrawal. The expectation is you will be in a lower tax bracket after retiring, so you win.
HSA is not taxable, although I don’t know if that’s just when used for medical expenses
After 65 they don’t audit what you withdraw for.
Once you hit 65, you can withdraw HSA funds for any purpose, tax free, like a Roth IRA. 401k withdrawals will be taxed as ordinary income, so an HSA dollar is worth about $1.20 in a 401k.