Use HSAs and FSAs to Your Advantage in 2023
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If you’re looking to improve your financial wellness, then you’ll want to consider leveraging health savings accounts (HSAs) and flexible spending accounts (FSAs) to pay for your current healthcare expenses. Most of us have medical expenses, so these two accounts give us a way to pay for those expenses and receive some tax benefits at the same time.
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In this email, you’ll find information on:
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- Health Savings Accounts
- Updated IRS Limits for HSAs
- Flexible Spending Accounts
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If you choose Purdue Global’s CDHP (Consumer Driven Health Plan), you can also elect a Health Savings Account to help manage out-of-pocket expenses for those eligible to participate. You can use the HSA to pay for eligible expenses like your deductible, coinsurance, prescriptions, some over-the-counter products and vision and dental services.
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Individual: $3,850
Family: $7,750
Age 55+: Additional $1,000
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5 Things to Like About HSAs
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1. Tax benefits:You may contribute to your HSA with pre-tax dollars deducted from your paycheck each pay period. It lowers your current taxable income plus it allows you to save for healthcare needs.
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2. Owned by you: The money in the account always belongs to you, even if you leave Purdue Global. There are no deadlines for using the money because the funds roll over year to year.
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3. Purdue Global helps, too: We also make annual contributions to your HSA*, divided into deposits per pay period:
- Individual: $300
- Employee + 1 Dependent: $400
- Employee + Family: $500
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4. Flexibility: You decide how much to contribute, and you can increase or decrease your contribution amount at any point. Reminder: When determining how much to contribute, consider that Purdue Global’s employer contributions also count toward the maximum amount allowed annually by the IRS.
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5. Retirement tool: A lot of people use HSAs to build a medical nest egg for retirement. Bonus: If you are an employee age 55 or older, you may contribute an additional $1,000 in 2023.
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Deposits are made incrementally per paycheck. If you’re ineligible for an HSA, you have the option of enrolling in a Health Reimbursement Arrangement (HRA).
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Flexible Spending Accounts
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You can also have an FSA to help pay for healthcare expenses. If you don't have an HSA, you may elect a Healthcare FSA to pay for medical, dental and vision out-of-pocket expenses. Additionally, if you are paying for childcare or elder care while you and your spouse both work, then you may also consider electing a Dependent Care FSA.
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Use It or Lose It: FSAs operate on a “use-it-or- lose-it” basis—that means you forfeit any unused funds remaining in the account at the end of the year.
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Maximum FSA Contribution*
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Healthcare FSA: $2,850
Dependent Care FSA: $5,000
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*2023 maximum amounts are typically announced in late October
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You are encouraged to review all benefits and actively enroll for 2023 benefit coverage.
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Save the Date: Open Enrollment Presentations
We'll cover what you can expect during open enrollment and discuss topics like medical and prescriptions benefits, voluntary plan options and more. There will also be time for a Q&A session.
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