HSA Calculator

Calculate your HSA tax savings, investment growth, and retirement healthcare costs. See the triple tax advantage in real dollars — contributions, growth, and withdrawals all tax-free. Updated IRS limits.

Coverage type

🧑 Self Only 👪 Family

⚠️ Note: Your state does not conform to federal HSA tax treatment. Check with your state tax authority — you may owe state income tax on HSA contributions.

Annual HSA Contribution ($)

2026 max: $4,400 self / $8,750 family

Your Federal Tax Bracket

State Income Tax Rate (%)

0% for no state income tax

Contribution Type

State

Age 55+ Catch-Up?

Contribution

—

this year

Tax Savings

—

all taxes

Effective Cost

—

after tax savings

Savings Rate

—

% of contribution

Full Tax Breakdown

The HSA is the only account with a triple tax advantage — contributions reduce taxable income, growth is tax-free, and withdrawals for medical expenses are tax-free. After age 65, you can withdraw for any purpose (paying ordinary income tax, like a traditional IRA).

Annual Contribution ($)

Current HSA Balance ($)

Years Until Retirement

Annual Investment Return (%)

S&P 500 historical avg ~7% inflation-adjusted

Annual Out-of-Pocket Expenses ($)

Amount you spend from HSA each year

Retirement Healthcare Need

Balance at Retire

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investing growth

Retirement Need

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healthcare est.

Total Contrib.

—

over all years

Tax-Free Growth

—

earnings

Growth & Retirement Analysis

HSAs and FSAs both let you pay medical costs with pre-tax dollars — but they have important differences. The right choice depends on your health plan, how much you spend on healthcare, and your long-term goals.

Feature	HSA	FSA
2026 Contribution Limit	$4,400 / $8,750 (family)	$3,300
Requires HDHP?	Yes — required	No — any plan
Rolls over year to year?	Yes — 100%, forever	Limited ($660 max or grace period)
Owned by	You (portable)	Your employer
Invest funds?	Yes — stocks, ETFs, mutual funds	No — cash only
Tax on contributions	Pre-tax (federal + state* + FICA)	Pre-tax (federal + state*)
Tax on growth	Tax-free forever	N/A — no investment
Tax on qualified withdrawals	Tax-free	Tax-free
Non-medical withdrawals (65+)	Yes (ordinary income tax)	No
Funds available immediately?	Accumulate over time	Full amount Jan 1
Self-employed eligible?	Yes	No
Change contributions mid-year?	Yes (any time)	Only with life event
Lose job — keep account?	Yes	No (forfeit balance)
Best for	Long-term health + retirement	Predictable annual expenses

            🏆 Which should you choose?

            If you have an HDHP and are relatively healthy, the HSA wins decisively — higher limits, rolls over forever, can be invested for retirement, and you own it. The FSA's main advantage is immediate availability (full year's funds on Jan 1) and it doesn't require an HDHP. If your employer offers both, you can pair an HSA with a Limited Purpose FSA (vision/dental only) to maximize tax savings.

2026 IRS Limits Reference

HSA

Self-only contribution limit$4,400

Family contribution limit$8,750

Catch-up contribution (age 55+)+$1,000

HDHP minimum deductible (self)$1,650

HDHP minimum deductible (family)$3,300

HDHP out-of-pocket max (self)$8,300

HDHP out-of-pocket max (family)$16,600

FSA

Health FSA limit$3,300

FSA rollover maximum$660

Dependent Care FSA limit$5,000 ($2,500 married filing separately)

HSA Calculator — Complete Guide ()

A Health Savings Account (HSA) is arguably the most powerful tax-advantaged account in the US tax code. Unlike a 401(k) or Roth IRA, which have only a single tax benefit, HSAs offer a triple tax advantage — contributions reduce your taxable income, the money grows tax-free, and withdrawals for qualified medical expenses are tax-free. No other account type offers all three.

        💡 The "Stealth IRA" Strategy: Many financial planners recommend maxing your HSA before contributing to other retirement accounts. Pay medical expenses out-of-pocket now (save the receipts!), let your HSA grow invested for decades, then reimburse yourself tax-free at retirement — there's no time limit on reimbursement. After age 65 you can withdraw for any reason (just pay ordinary income tax, like a traditional IRA). This effectively turns your HSA into a second retirement account with better tax treatment than a 401(k).
      

How the Triple Tax Advantage Works

1. Contributions reduce taxable income. Every dollar you contribute to an HSA reduces your federal and state taxable income. If you're in the 22% federal bracket and contribute $4,400, you save $968 in federal income tax. If your state has income tax, you save even more. If contributions are made through payroll, you also avoid FICA taxes (7.65% on up to the Social Security wage base), saving an additional $336.

2. Growth is completely tax-free. Unlike a taxable brokerage account where you pay capital gains and dividend taxes each year, HSA investments grow without any tax drag. Over 25 years at 7% returns, $4,400 per year grows to approximately $300,000 — entirely tax-free if used for medical expenses.

3. Qualified withdrawals are tax-free. Medical expenses paid with HSA funds are never taxed — not when the money went in, not when it grew, and not when it comes out. Qualified expenses include deductibles, copays, prescriptions, dental, vision, LASIK, hearing aids, mental health, and hundreds of other medical costs.

2026 HSA Contribution Limits

Coverage	2024 Limit	2025 Limit	2026 Limit	Change
Self-Only	$4,150	$4,300	$4,400	+$100
Family	$8,300	$8,550	$8,750	+$200
Catch-Up (55+)	$1,000	$1,000	$1,000	No change
Self-Only + Catch-Up	$5,150	$5,300	$5,400	+$100
Family + Catch-Up	$9,300	$9,550	$9,750	+$200

States That Don't Recognize HSA Deductions

Three states do not conform to the federal HSA tax treatment: California, New Jersey, and Alabama. Residents of these states must pay state income tax on HSA contributions and investment gains, though federal tax benefits still apply. If you live in one of these states, your HSA tax savings are lower than for most Americans — but the federal and FICA savings are still significant.

Qualified Medical Expenses

HSA funds can be used for a wide range of medical expenses including deductibles and copays, prescription medications, dental care (including orthodontia), vision care (glasses, contacts, LASIK), mental health services, chiropractic care, hearing aids, medical equipment, and long-term care insurance premiums. Since 2020, over-the-counter medications no longer require a prescription to qualify. Menstrual care products were added as qualified expenses in 2020.

What is an HSA and how does it work?

A Health Savings Account (HSA) is a tax-advantaged account you can use to pay for qualified medical expenses. To open and contribute to an HSA, you must be enrolled in a High Deductible Health Plan (HDHP). Money goes in pre-tax, grows tax-free, and comes out tax-free for medical expenses — the triple tax advantage. Unlike an FSA, HSA money rolls over every year with no "use it or lose it" rule, and you own the account even if you change jobs. Once you turn 65, you can withdraw for any purpose and just pay ordinary income tax, similar to a traditional IRA.

Can I invest my HSA funds?

Yes — most HSA providers allow you to invest your balance in mutual funds, ETFs, or index funds once your balance exceeds a minimum threshold (typically $500–$1,000). Investing your HSA is where the real power comes from. A $4,400 contribution invested at 7% annual returns becomes approximately $23,600 after 20 years, all tax-free. Popular HSA custodians with good investment options include Fidelity (zero fees, excellent fund selection), HSA Bank, Lively, and HealthEquity. Many employers use custodians with limited investment options — you can often do a trustee-to-trustee transfer to a better provider.

What happens to my HSA if I'm no longer on an HDHP?

You can keep your existing HSA and use the funds for qualified medical expenses — you just can't make new contributions while not enrolled in an HDHP. The money stays in your account, continues to grow tax-free, and you can continue using it for eligible expenses. This is one reason the HSA is so powerful: the portability means you build up a growing tax-free healthcare reserve regardless of future plan changes. If you later return to an HDHP, you can resume contributions.

Is an HDHP worth it just to get an HSA?

Often yes, but it depends on your health situation. HDHPs typically have lower premiums but higher deductibles. If you're relatively healthy, you pay less in premiums and can deposit the difference into your HSA. The tax savings plus the investment growth potential often outweigh the higher deductible risk — especially if you can afford to pay unexpected medical costs out of pocket and let the HSA compound. For people with chronic conditions or families with frequent medical needs, a traditional plan with lower deductibles may make more sense. Run the numbers with our calculator above using your actual premium difference and expected medical costs.

How much should I save in my HSA for retirement?

Fidelity estimates that the average couple retiring at 65 will need approximately $315,000 for healthcare expenses in retirement (2024 estimate), not including long-term care. A single retiree needs approximately $157,000. These estimates account for Medicare premiums (Parts B, D, and Medigap supplements), out-of-pocket costs, and dental and vision. If you maximize your HSA contributions and invest them, starting at age 35 with the 2026 family limit of $8,750/year at 7% growth, you'd accumulate approximately $650,000 by age 65 — more than enough to cover estimated healthcare costs tax-free in retirement.

Can I use my HSA for non-medical expenses?

After age 65, yes — you can withdraw for any reason and simply pay ordinary income tax on the amount, exactly like a traditional IRA. Before age 65, non-medical withdrawals are subject to income tax plus a 20% penalty. This is why the HSA is often called a "stealth IRA" — worst case, it's as good as a traditional IRA, but if you use it for medical expenses it's far better. The key insight: save your medical receipts indefinitely. There's no deadline to reimburse yourself from your HSA for past medical expenses, so you can pay out-of-pocket now and reimburse yourself years later when the money has grown substantially.