Growing our HSA

We decided a few weeks ago to make our HSA a priority, ahead of retirement accounts for the time being.   HSA’s double as retirement accounts if you don’t have to use the money for medical expenses, but the same is not true in reverse.   And we have our HSA invested in a great growth fund, so it’s not like the money is just sitting in a bank account.

Earlier this month, I arranged to cut my 457 plan contributions from about $480/month to about $80/month.   We’re putting the extra money into our HSA, and I made a $600 contribution this week.   We want to max out the account by year end ($5650 is the IRS limit for 2007 for a family HSA), which will be a stretch because we’ve only put in $2100 so far this year.   But we hadn’t been focusing on the HSA as much until this month.

My husband will get his knee fixed  in January, which will meet our health insurance deductible ($3000) for 2008.   We have 100% coverage after the deductible, so anything else we get done for the rest of the year will be covered in full.   This is why we decided to schedule the knee surgery (if it does indeed need surgery) for January instead of December, when the first appointment is available.    We have no intention of using doctors or a hospital for the birth of our baby or anything related to the pregnancy, but just in case some crazy complication were to arise, our health insurance deductible will already be met for both of us for the year once my husband’s knee is taken care of.  

Paying the deductible for his knee will take a big chunk of the money out of our HSA, but we intend to replace it in 2008, and keep the HSA as a major focus until we have $10,000 in it.   Medical expenses are really our largest potential emergency expense.   We have a $1000 deductible on our homeowner’s insurance (I’d prefer a higher deductible, but that’s as high as our  mortgage lender will allow).   We own two cars but could easily get by with one, since we both work from home, and I ride my bike  to my job at the library.   If an appliance goes out, we’ll get a “new” one at the refurbished appliance place where we got our washer and dryer for under $200 each.   We’re pretty savvy about finding ways to deal with the stuff that life throws at us without spending big bucks.   But medical expenses are always a possibility.   We take very good care of ourselves, but you never know when some freak accident or strange illness will strike.   And with a $3000 deductible on our health insurance, we don’t want to be caught without a solid medical emergency fund – our HSA.