Healthcare is changing fast, and there are new ways for you to benefit. A WageWorks® Health Savings Account (HSA) is like a 401(k) for healthcare. Combined with your company’s high-deductible health plan, a WageWorks HSA gives you an easy, safe way to lower your healthcare costs today while saving money for future healthcare expenses.
Why enroll in a WageWorks HSA?
An HSA can help you save on taxes in three ways.
Use this calculator to see how much you can save with an HSA.
|Your Estimated Tax Savings|
|Without HSA||With HSA|
|Gross annual pay (estimate)||$60,000||Gross annual pay (estimate)||$60,000|
|Estimated tax rate (30%)||-$18,000||Max. annual family HSA contribution||-6,750|
|Net annual pay||=$42,000||Adjusted gross pay||=$53,250|
|Estimated annual medical expenses||-$6,750||Estimated tax rate (30%)||-$15,975|
|Final take-home pay||=$35,250||Final take-home pay||=$37,245|
Take home this much more with a HSA Account: $2,025
All figures in this table are estimates and based on an annual salary of $60,000 and maximum contribution limits to the benefit account. Your salary, tax rate, healthcare expenses, and tax savings may be different.
An HSA is right for you if:
Find out if you’re qualified to enroll in an HSA. Take this short HSA qualification quiz.
Building your healthcare nest egg couldn’t be easier. Simply decide how much you want to contribute to your WageWorks HSA each year, and funds are automatically withdrawn from your paycheck for deposit into your account before taxes are deducted.
You can add money to your HSA in two ways:
Any money left in your account at the end of the year stays in your HSA. Or you can choose to move it to an investment account that offers competitive interest rates, low fees, and a variety of investment options.
You can contribute the following amounts to your HSA:*
The IRS sets the annual contribution limits. A different limit may apply to you according to your employer’s plan.
HSA contributions in excess of the IRS annual contribution limits are not tax deductible and are generally subject to a 6% excise tax.
If you’ve contributed too much to your HSA, you can do one of two things:
Consult with your HSA trustee to return excess contributions and determine net income attributable to the excess contribution. See Form 5329, Additional Taxes on Qualified Plans (including IRAs) and Other Tax-Favored Accounts for more information.
While there are no spending limits on your HSA and the money in your HSA rolls over year to year and is yours to keep, it’s still a good idea to estimate how much you spend on eligible healthcare expenses for you and your eligible dependents each year before you decide how much to contribute to your HSA.
Use this calculator to estimate your annual eligible expenses and determine an annual HSA election amount that’s right for you and your family.
You enroll in or renew your enrollment in your HSA through your employer during your Open Enrollment period each year. Your human resources department or benefits administrator can tell you when employees in your organization can enroll in an HSA and help you get started.
You should plan on an election amount to your HSA that meets your needs for the entire plan year. Check with your benefits administrator to see how often you can change your HSA election amount during the plan year.
The best part about your WageWorks HSA is that you can earn money while saving money. Just like a traditional savings account, the money in your HSA earns interest in an FDIC-insured account from which you withdraw funds at any time. You can keep some money liquid in your account to pay for today’s healthcare expenses as they arise. And you can invest the remainder of your balance to save for future healthcare expenses.
WageWorks has partnered with a trusted and FDIC-insured bank, BNY Mellon as your HSA custodian. You get competitive interest rates, low fees, and attractive investment options to grow your healthcare nest egg according to your own needs and risk tolerance. You can choose from several high-, moderate-, or low-risk investment vehicles to maximize your savings as your financial situation changes over time. And your WageWorks HSA is supported by a full-featured technology platform with wealth planning tools.
Once your balance reaches $1,000, you may start investing the money in your HSA and not pay taxes on your gains. Your interest and investment income earned on HSA balances is also tax-free, allowing you to build a bigger nest egg even faster. *
With a WageWorks HSA, you can take your healthcare nest egg with you wherever your career takes you. Unlike a Healthcare Flexible Spending Account, your HSA is yours to keep, even if you change jobs, switch healthcare plans, or retire. If you lose your job and elect to retain your high-deductible health plan under COBRA, you may even pay the COBRA premiums from your HSA. The money in your account always rolls over year to year—there’s no “use it or lose it” risk.
With a variety of convenient payment options, your WageWorks HSA makes it easy for you to get reimbursed for hundreds of eligible healthcare expenses, like copayments for doctor visits, prescription drugs, and new eyeglasses or contact lenses.
Payment options include:
WageWorks makes it easy to manage your HSA. Log into the WageWorks secure web portal to manage all aspects of your WageWorks account:
The WageWorks EZ Receipts® mobile app puts the power of the WageWorks web portal in the palm of your hand. Download this handy app to your mobile device, log into your account, and check balances, submit claims, view transactions, snap photos of receipts, get account alerts by text or email—all on the go!
The combination of a Healthcare FSA and an HSA is a great way to maximize your savings this year and in the future. But there are rules guiding your participation in both accounts.
You can choose to have both an HSA and Healthcare FSA if you: