How Can I Determine the Right Amount to Contribute to My HSA?

• An HSA, or Health Savings Account is a tax-advantaged account that stays with you even if you leave your employer, and funds in an HSA generally rollover from year to year.
• The first step is to make sure you can contribute to an HSA with your health plan. Generally, you must be enrolled in an HDHP to contribute to an HSA—confirm you have an HDHP that is HSA-eligible.
• Pairing: If you or your spouse has a General-Purpose FSA for the plan year, you cannot contribute to an HSA at the same time.
• Changes to your HDHP plan such as enrolling in Medicare (which is often retroactive), adding or removing FSA coverage, are all factors that may change your eligibility to contribute to an HSA.*
• Eligibility vs. Spending Existing Funds: Since an HSA typically stays with you even if you change your job and funds rollover year to year, you can usually spend existing funds in your account, but you might not always be eligible to contribute each plan year if there are changes to your plan. There’s a difference between the two, so be sure to check whether you can contribute to your HSA at the beginning of every plan year.

* For any personal eligibility questions, confirm with your employer’s HR department or a tax professional.

Before you decide whether you should max out your HSA, it may be helpful to think about some contribution goals for the year. The “right” amount to contribute to your HSA looks different for everyone and will likely look different for you through life stages and transitions like adding dependents and changing healthcare needs. Here are a few contribution goals to consider:

• Option A: “Bare minimum” (This is only what you’re confident you’ll use in the current plan year)
• Option B: “Safety net” (Aim to cover your plan’s deductible and out-of-pocket max)
• Option C: “Maximize” (If it makes sense for your finances, contribute up to the current-year limit, $4,400 for self and $8,750 for family in 2026)

• Next, estimate how much you approximately spend on healthcare each year. Your HSA funds can be a good way to pay for out-of-pocket healthcare expenses with pre-tax dollars.
• Some common categories to include can be: prescriptions, labs, recurring visits, dental and vision costs, therapy, planned procedures, and devices or supplies.
• Other items to add would be any life events you may have coming up that could increase your healthcare expenses, such as pregnancy and postpartum care, managing a chronic condition, braces, planned imaging, etc.
• Make sure you subtract the amount that insurance typically covers vs what you actually pay when determining your yearly healthcare expenses.
• You may also want to consider contributing a buffer amount for any unexpected health expenses that might come up. While this looks different for everyone, you could contribute enough to cover your HDHP’s deductible, which is a minimum of $1,700 for self coverage and $3,400 in 2026, and a maximum of $8,500 for self coverage or $17,000 for family coverage.

• Once you figure out an annual target that makes sense for your finances and health expenses, you can then see how much you should put in your HSA per paycheck so you know exactly how much is going in.
• How much to put in your HSA per paycheck: Here’s a simple formula: annual target ÷ number of paychecks = contribution per paycheck
• Example: $2,400 annual target ÷ 24 paychecks per year = $100 per paycheck
• Remember, if you experience any changes to your income or expenses over the plan year, you can usually re-run the math and adjust your payroll contributions.
• Employer contributions: If your employer also contributes to your HSA, you may want to reduce your own per-paycheck amount accordingly.

Whether you max out your HSA depends on your individual financial situation, and the right answer is what makes the most sense for your money and healthcare costs. However, there are some pros and cons to consider if you’re thinking about maxing out your HSA.

Pros:

• Tax advantages: HSAs are triple-tax advantaged—pre-tax dollars are contributed, funds grow tax-free, and withdrawals are tax-free for eligible expenses.
• Rollover: HSA funds typically rollover from year to year.
• Flexibility: Flexibility for future qualified health expenses—both expected and unexpected.
• Investing: You can potentially invest the funds in your HSA, which could lead to more growth on your pre-tax dollars for future health expenses.

Cons:

• Cash flow: Maxing out your HSA might tie up cash you may need immediately.
• High-interest debt: Contributing to max out your HSA may not be ideal if you’re carrying high-interest debt or are unable to cover basic costs.
• Unstable income: If your income is not steady or you have other urgent short-term expenses, maxing out your HSA might not be the best fit for your finances.

Bottom Line: Look at your finances, and only max out your HSA if it doesn’t cause financial strain. Contributing the maximum amount to your HSA might be a better fit if you have a stable cash flow, emergency savings, more predictable expenses, and are looking to build health savings for the long term.

• Contribution limits: Make sure you verify the IRS contribution limits for the current plan year. For 2026, the HSA contribution limit is $4,400 for self-only coverage and $8,750 for family coverage. Remember, yours and your employer’s contributions both count toward the annual HSA limit.
• Catch-up contributions: If you’re 55 years or over and not enrolled in Medicare, you can contribute an additional $1,000 as a catch-up contribution into your HSA per plan year.
• Contribution deadline:
  • The last day to contribute to your HSA for 2025 tax year is April 15, 2026.
  • The last day to contribute for the 2026 tax year is April 15, 2027.
• Over-contribution: If your HSA contributions exceed the annual limit set by the IRS, you may be subject to tax penalties if it’s not corrected right away. To correct excess contributions to your HSA, withdraw the excess contributions by the tax filing deadline in the same plan year to avoid penalties.

Keep records: Be sure to keep all contribution records, receipts for qualified expenses, and any documentation you receive for reimbursements.

Once you determine your contribution targets and saving goals for your HSA, you’re good to start spending on eligible health expenses. Truemed* can help you spend your HSA funds on eligible purchases beyond what you might typically find at HSA or FSA online stores, when used to treat or manage a specific health condition supported by an LMN. Knowing your target contribution can help you budget for eligible expenses you may want to use your HSA funds for. Here’s how Truemed can help:

• Customers can complete a clinical intake form to see whether they may be eligible for certain purchases where a Letter of Medical Necessity (LMN) may be relevant, such as fitness equipment, mattresses, gym and studio memberships, and more.
• An independent licensed practitioner may issue a LMN when clinically appropriate.
• Eligibility is contingent on the individual, the product, documentation, and plan rules—your plan administrator makes all final reimbursement decisions.
• Note: Truemed can support how you use your HSA/FSA funds for eligible purchases, not how contribution eligibility is determined. Check your plan to be sure you are eligible to contribute to an HSA.

*Truemed is for qualified customers. See terms at truemed.com/disclosures.