A recent analysis by the Employee Benefit Research Institute (EBRI) reports on the savings potential of health savings accounts. The authors conclude that the current statutory limits on yearly contributions relegate HSAs to playing merely a minor role in covering health costs in retirement.
Their analysis examines the potential savings of individuals who begin contributing to their HSA at age 55 and contribute $3,000 and a $1,000 catch-up contribution each year until age 65. With a 2 percent interest rate, one would save approximately $48,300 after 10 years and if the interest rate were 5 percent, just over $55,000 would be accumulated over 10 years.
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