Using a HSA?

Continuing the discussion from Omicron:

I saw this post, and I’m curious — do people actually use their HSA for minor medical expenses like this? I try not to touch my HSA at all & basically use it as an additional retirement savings vessel. There have been occassional times where an expensive ER trip or something happened and I paid out of the HSA to avoid draining free cash, but usually I’ll just pay out of general savings and let the HSA keep growing. Is there a reason not to do that?

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I try not to use it if I don’t have to, but I’m not wealthy and most of my assets are not liquid, as I’m pumping as much as I can into retirement. So yeah, I’m a little cash-poor at the moment due to various factors, so if I’m buying $100 worth of covid tests, I’m probably pulling out the HSA card for that. Keeping my liquid assets for situations my HSA can’t help out with.

Just got a $550 medical bill for one of my kids. HSA will be paying for that as well.

In an ideal world, a $550 bill wouldn’t be a thought. In my current state, it is.

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I think just when you need liquid cash. I’d argue that if you need the cash, put less into your 401k and keep everything in HSA since it’s more tax efficient, but that takes some foresight.

I don’t have kids and am young-ish so I don’t have major medical expenses and haven’t touched my HSA since the first year I opened it.

Yeah, I totally get that reason. I wasn’t calling you out specifically — more wondering if in general people tended to use it as a saving or spending account.

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As with all of my savings accounts, they usually end up becoming a spending account at various points! =)


i have the luxury of using mine strictly as a retirement savings vehicle. don’t intend to withdraw for 10+ years.

also have a limited FSA that can be used for medical post-deductible (and vision/dental/other). I use that each year bc of the use or lose nature.

I used to use my HSA for all health expenses because health is real expensive when it ain’t free imho. But that HSA is tied to my old job now, and roughly 3K is just sitting there until I really need to use it.


It’s a spending account for me.

I have enough currently-un-reimbursed bills that, assuming no more medical bills, I’ll be making withdrawals for another two years.

I reimburse my stuff as soon as I can. I want the cash flow.

My BIL, has saved up all of his receipts and has not yet requested reimbursement. He’s going to let that HSA grow with the market, then, when he retires, use it as another source of income by finally requesting reimbursement for his medical bills from back in 2010.

Side comment: an HSA is the only tax-free income I’ll ever see. It’s not taxed going in. It’s not taxed going out.

Only if used for medical expenses, right? It is my understanding that those deferring specifically for retirement income will be paying ordinary income tax rates on the withdrawals.

I hadn’t considered this. What kind of limitations exist here? Can I use funds deposited in 2020 for an expense that occurred in 2010? Did the HSA have to exist when the expense was incurred?

Yes, only if used for medical expenses.

In my BIL’s case, he has medical expenses…he’s just going to hold off until retirement age to get them reimbursed.

Yeah…I’m not quite sure.

I do know that you have had to had an HSA before the expense happened…but I’m not clear on the details after that.

I am using it as a spending account, I am more liquid now-a-days, but developed habits

Also, have large deductible and wife had some major dental. But was using it on smaller purchases as well

I use it as a spending account. Dentist, Rx, basic physician care for three people.

Nothing expensive (well, a root canal and all my crowns, and my wife’s new front teeth (broke them skateboarding pre-teen, the caps needed replacing)), and I still “save” thousands yearly. It is mainly for the possibility of a major expense that will be higher than my deductible. Don’t want to spend my already-taxed dollars on that.

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pretty sure it does, but no idea what sort of audit system exists

The real question we should be asking is, is it “a HSA” or “an HSA”?


I have very few medical bills, but they all come out of my HSA including my $35 chiropractor visits. That is what it’s for after all; paying medical bills without paying any taxes. You can withdraw from an HSA at age 65 but you’re still going to pay taxes on the withdrawals, so it’s just a traditional IRA at that point.

Can an HSA be used to pay for previous year expenses?

You can pay or reimburse yourself for any eligible medical expenses incurred after your HSA was established.

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I changed it 3 times — get out of my head!