The main reason I'm asking is because our employer lets us invest everything over $1,000 HSA balance into index funds. We're married filing jointly and our combined salaries are $175k. I contributed $4300 to my HSA and invested $3,300 into a few different funds from that, spouse only contributed $900 to HSA so couldn't invest any. Their logic is that they would rather have more cash every paycheck to invest in whatever they want or just to put in the bank for an emergency. My logic is that they're throwing away a lot of money over the course of our careers by not taking advantage of the tax-free income as well as the risk of not investing it safely (they just trickle money into BTC and save most of it as cash).
Spouse doesn't want to contribute very much to HSA, is this good/bad or does it depend?
byu/hellish_existance inpersonalfinance
Posted by hellish_existance
9 Comments
You’re married filing jointly, but on an everyday level, are you basically managing your finances separately?
If so, that’s the reason. Money in an HSA is for some distant date in the future. Money in their checking account is money they can spend now.
Your wife isn’t doing any actual investing. Crypto is gambling, and cash is for emergencies and to rot away losing value to inflation. She should consider HYS instead.
I’d say it depends because I’m curious on how you handle the rest of your finances. For instance, does your spouse earn significantly less than you? Do you both contribute to a joint emergency fund? If there were an emergency situation that directly affected them (for instance their car broke down), would they be expected to handle it out of their own money only?
I do think tax advantaged money is being left on the table, but the part about them banking the money for an emergency in light of your separate funds is interesting.
I mean if you are married but keeping eachothers finances separate for some reason I guess it’s her account and thus her choice.
Personally I view an HSA as the best investment account you can have so yes I am maxing mine out as a priority.
Do you each have HSA or do you share an HSA?
My wife has a primary PPO through her job, and I also cover her on my HDHP (I am not on her PPO). This means I can contribute to the family limit to my HSA through my payroll, and I do. She uses the HSA as needed. We settle up through our normal monthly accounting for expenses, as we are joint on each others accounts.
If your wife has her own HSA through her own HDHP then you cant make her contribute more. You cannot contribute more to your HSA unless you have more coverage than just yourself on your HDHP.
Also she is being silly, HSA is the best tax advantage investment account in America. HSA money isnt actually money in the future, it is also money right now because it can be used for health expenses now. You can be one of those people who saves receipts for the future if you want.
Talk to your spouse about getting her own HSA outside of her employer and invest into whatever they want to in there instead.
I never use my employer’s HSA because a lot of them have that same basic $1k cash minimum, and I want all my HSA money to be invested into the stock market.
HSAs are the only triple tax advantaged accounts in the US. Pre tax dollars, growth tax free, tax free withdrawals for health reasons. Save all your receipts from now to withdraw in 20 years after you get your growth. In short, you both should push as much money as you can in and save every receipt to collect later.
Imo, an HSA is the best financial instrument a family can use to avoid taxes; both immediately and long-term. If you can contribute to an HSA you should max out your contributions every year.
Maxing HSA is one of the most obvious saving/investment moves. It’s a no-brainer.