A health savings account (HSA) is a flexible financial tool that serves you throughout every stage of your life. This account allows you to take control over your finances in a way individually tailored to your financial situation.
The HSA market is rapidly evolving and growing with each passing year and UMB Healthcare Services currently manages 1.6 million HSAs. According to the 2024 Year-End Devenir HSA Research Report‡, as of Dec. 31, 2024, HSA assets reached $147 billion across more than 39 million accounts. Other key findings included:
- HSA investing has started to take hold: HSA investment assets increased 38% in 2024, reaching $64 billion, In total, about 9% of HSA accountholders invested a portion last year (3.5 million HSAs).
Saving and spending are up: Contributions to HSA accounts grew 11% in 2024 while withdrawals grew 10%. In addition to the above, 2025 has seen some legislative changes that will increase access to HSAs in 2026 and beyond. Now is the time for you to learn about the benefits of being an HSA accountholder and how it can improve your financial well-being.
Understand the basics of HSAs
There are many benefits of having an HSA and in order to get the most out of your account it is important to familiarize yourself with each. An HSA is an individually owned, tax-advantaged[1] account that may be used to pay for qualified medical expenses or to save for retirement and long-term care expenses. In 2025, the maximum contribution amount for HSAs is $4,300 for individuals and $8,550 for family coverage. If you are 55 or older, you can also contribute an extra $1,000 at the end of the year as part of the HSA catch-up contribution limits updates for 2025-26.
It is important to note that while there may be restrictions on making HSA contributions, there are no restrictions on when you can spend your HSA funds. This allows you to make the decision of when and where you want to put your HSA funds without the fear of them expiring at the end of the benefit year.
Determine if you are eligible for an HSA
You are ready to open and contribute to an HSA if you:
- Are enrolled in a high-deductible health plan (HDHP)
- Are not enrolled in any part of Medicare
- Are not claimed as a dependent on another’s taxes
- Do not have any other non-permissible health coverage, such as a medical plan other than a HDHP
Understand the unique benefits of an HSA
An HSA gives you the opportunity to save money on a tax-free basis and serves as a useful investment [2] vehicle to add to your 401(k) and/or individual retirement account (IRA) when looking ahead to your future savings. The triple tax advantage offered by HSAs means:
- Funds going into the HSA are tax-free
- Funds earn tax-free interest
- Funds and investment earnings withdrawn from the account for eligible medical expenses are tax-free
In addition, an HSA is owned by you and offers benefits that differ greatly from a FSA, which is sponsored by your employer. Unlike FSAs, the money in your HSA is yours, no matter if you change jobs or choose to retire. An HSA gives you the ability to roll over your entire unspent amount year after year and calculates, compounds and credits interest monthly.
Set up your HSA
During annual enrollment, many employers will offer HSAs, but if yours does not you can still open one with an HSA provider. If you have an insurance provider, check with them to see if they partner with a certain financial institution. Alternatively, you can check with your personal bank that you use for your regular checking and savings account needs, as many offer HSAs. Your bank will be able to provide you with assistance on setting up an HSA for your individual or family coverage.
Get the most out of your HSA
Whether you’re new or not new to the world of HSAs, there are a couple of approaches you can take to get the most out of your HSA benefits. In order to see the true impact of an HSA, it is important to learn how to maximize your HSA each year. For example, in your first year of having an HSA your strategy might look like spending or minimally saving, while in your sixth or tenth year with your HSA you could change your focus to increasing your contributions to save more and invest. As you progress through life stages the way you use your HSA will change along with you, so do not be afraid to switch up your HSA strategies for your financial needs.
Another way to fully utilize your HSA is to be intentional about investing assets within your HSA. Many are leaving money on the table, according to the Employee Benefit Research Institute’s analysis‡, only 25% of accountholders opened their HSA to help them invest. One of the greatest advantages of an HSA is that it offers you the ability to make investments once you reach a certain amount of money. Whether you are new to HSAs or have had an account for several years, it is a great time to better understand all your HSA offers and plan for financial well-being. Financial tools, like HSAs, offer flexibility and give you the power to better prepare for your financial future. Be sure to speak to a trusted financial advisor to see how an HSA could help you reach your financial goals.
Learn more about UMB Healthcare Services, which has one of the best HSAs for 2025 among all HSA providers.(Source: Investor Business Daily’s Best HSA Accounts For 2025)
[1] All mention of taxes is made in reference to federal tax law. Neither UMB Bank n.a., nor its parent, subsidiaries, or affiliates are engaged in rendering tax or legal advice and this document is not intended as tax or legal advice.
[2] Investments in securities through HSA Investment account are:
Not FDIC Insured. May Lose Value. No Bank Guarantee
When you click links marked with the “‡” symbol, you will leave UMB’s website and go to websites that are not controlled by or affiliated with UMB. We have provided these links for your convenience. However, we do not endorse or guarantee any products or services you may view on other sites. Other websites may not follow the same privacy policies and security procedures that UMB does, so please review their policies and procedures carefully.
