Ease Your Employees Into an HSA with HSA Advance
April 11, 2018
You’ve likely heard the saying, “You only have one chance to make a first impression.” A positive first impression is just as important for anyone enrolling in a Health Savings Account (HSA) and High-Deductible Health Plan (HDHP) for the first time. The number of accounts is expected to increase by 5.5 million from 2017 to 2019, meaning that as many as 25 percent of accountholders in 2019 will get their first impressions of an HSA this year and next year.
Getting started with a Health Savings Account and an HDHP can be intimidating for employees as they build up their balances. That’s where HSA Advance comes in. This feature lets you ease your employees into a Health Savings Account and HDHP by allowing them to use future contributions before they’ve built their funds. Keep reading (and download your free infographic below) to learn more about why you should offer HSA Advance to your employees.
You’ll save money
When your employees take advantage of an HSA’s tax benefits, you’ll save money as well. Employee contributions are made on a tax-free basis, which reduces your payroll tax. And any contributions you make into your employees’ accounts are tax-deductible.
How does it work? You pre-determine the amount of funds they can draw from through HSA Advance, which minimizes your risk. And your employees’ future contributions automatically pay back the advance amount owed first.
You’ll help your employees get started
HSA Advance can be particularly helpful to your employees in their first year with a Health Savings Account and an HDHP, since it helps them pay for eligible expenses while they’re still building their balances. According to Devenir’s latest year-end HSA trends report, the average account balance grows significantly in the second and third years:
This means HSA Advance can help your employees get their accounts started on the right foot until they reach a point where they’ve built up funds in their account.
You’ll give your employees time to get comfortable with their account
Health Savings Accounts are full of savings and investment potential, and employees are taking advantage. In each of the last three years, HSA assets and deposits have grown at a faster rate than the number of accounts, which could indicate that participants are:
- Setting aside more funds with each passing year to use their accounts as savings tools.
- Increasingly growing their dollars by investing their funds, since an account's retirement-planning potential rivals a 401(k) and IRA.
Using HSA Advance helps your employees’ first year with a Health Savings Account go smoothly, ultimately helping them see the benefit. And as they see and experience the benefits of an account, they might feel more inclined to continue contributing to their account, eventually getting to a point of saving and investing.
Want to learn more about HSA Advance? Download your free infographic today by completing the form below!