2014 Health Savings Account (HSA) Contribution Limits

by Michael on Aug 19, 2013 · 1 comment

Photo of a Stethoscope and Piggy Bank

With open enrollment is just around the corner, I thought I’d take a moment to highlight the new HSA contribution limits for 2014.

As a reminder, an HSA (Health Savings Account) is a special, tax-advantaged savings account that you can use if you have a high-deductible health plan (HDHP).

By definition, an HDHP has to have a deductible of at least $1,250 for individuals and $2,500 for families (up from $1,200/$2,400 in 2013). We’ve had a $3k family deductible ever since making the leap to an HDHP and have come out way ahead thanks to the much cheaper premiums.

HSA contribution limits

In 2013, individuals were allowed to contribute up to $3,250/year and families could contribute up to $6,450/year. In 2014, those limits are increasing to $3,330/year for individuals and $6,550/year for families.

Thus, individuals will be able to sock away an extra $80/year and families will be able to save an additional $100/year. Both of these are very welcome increases and we’ll most definitely be taking advantage of the higher limit.

Making the most of your HSA

While your HSA is a handy tool for avoiding taxes on your medical expenses, it can be much more. Indeed, if you can swing it, you might consider leaving the money in place and using the account as an extra, tax-advantaged investment account.

Yes, a number of HSA providers offer decent investment options. And yes, you’re free to choose your own HSA provider if you don’t like the options (or fees!) associated with your employer’s preferred provider.

Related: Here’s my comparison of HSA Bank vs. HSA Administrators, which are two of the most popular HSA providers for those who wish to invest.

Note that I’m not suggesting that you start investing money that you’ll need in the short-term. But if your cash flow can handle both your HSA contributions and your medical expenses, then your HSA can serve as an additional retirement account.


1 Holly@ClubThrifty August 21, 2013 at 9:09 am

I still have about $1000 in my HSA from a few years ago so I haven’t contributed anything yet this year. We all need to go to the dentist, though, so I really need to start thinking about it!

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