4 Hacks To Turn Your HSA Into A $700,000 Tax-Free ATM

People are using HSA's like tax free ATM and in this video, I'm going to show you exactly how. For years, I have preached about how HSA's are the single best tax advantage account that exists because it is the only account where you get tax free investment growth, tax free withdrawals and reimbursements and tax deductions for simply putting money into it. And on top of all of the the wealthy have figured out a clever reimbursement strategy using these same exact rules and benefits that is allowing them to accelerate their HSA investment returns and even pull tax free dollars out later whenever they want to. So today I'm going to walk you through all of this and I will even tell you how I'm personally using my own HSA this year as a license CPA that tax plans every day at my CPA coach.com. So let's go ahead and jump right in. Okay, so let's start from the beginning. What exactly is an HSA? Some people confuse it with an FSA, which is a flexible spending account, but it's not. An HSA is a health savings account that is designed to incentivize people to save for their own health expenses. And the government desperately wants people to do this because number one, it eases the burden government programs like Medicare and Medicaid for instance. And number two, it helps people pay for their medical bills. Medical debt is the leading cause of bankruptcy in the United States and HESA are designed to help people pay their medical and health bills. So, to get people to do this, the government offers some of the best tax benefits that exist. The tax benefits associated with HESA are better than your IRA your 41K, your 529 plan and whatever else you have, okay? Like if I had to choose between saving through a retirement plan or an HSA, I'm always choosing my HSA first because the moment you contribute a single dollar to your HSA, you receive a tax deduction. That's the first benefit. Then you have to understand that you do not have to just let your money sit there. These accounts are not piggy banks. They're literally investment You can buy stocks, bonds, index funds and other investments. And guess what? When you do that, the money you earn on those investments are tax free. You don't have to pay any income tax, capital gains tax, dividend tax, nothing. You can earn as much money as you want inside your HSA and as long as those funds stay there, you will never have to pay taxes on it, which is the second benefit. You get tax free investment growth. But this third benefit is where things get very interesting. When you use your HSA for qualified health expenses, those dollars come out tax free. And this is just the beginning of how people can start using their HSA like a tax free ATM. I'll give you a simple example to start here. So, earlier this year, I actually tore my Achilles playing basketball. I never I mentioned it anywhere and I continue putting content out for you all here. But I had to get surgery, physical therapy, I had to use crutches, rollers, get on a bunch of pain medicine in the whole night. And none of this stuff was cheap, right? But fortunately, I was able to use my HSA to pay for all of these things. Despite being relatively healthy, I had already been maxing out my HSA every single year using it to reduce my tax. uses using it to invest and now I was able to pull dollars out of it tax free to pay for this sudden and unexpected medical expense. So I'm telling you personally and professionally when you use this correctly it is a win win. And to be honest this is just a simple basic example of how people are using HESA. There is one additional trick that savvy investors are using to get even more juice out of their HESA and it involves keeping their HSA dollars invested in reinvesting themselves for their out of pocket medical expenses at a later date. This allows them to benefit from maximum growth potential from their investments while receiving a tax-free reimbursement for all of the medical expenses they've incurred over the years. Now, I know at first that sounds like a load of, right? So let's break this down into very simple terms just so that you can see just how powerful this is. First, from an investing perspective, you must fully understand two famous quotes. Number one, compound interest is the eighth wonder of the world by Albert Einstein. And number two, the first rule of compounding is to never, never interrupt it on necessarily. So look, sophisticated investors who know how to actually double, triple or quadruple their money through compounding absolutely hate the idea of interrupting it. They understand that compound interest is like a snowball that will keep growing and growing, but if you interrupt it, you have to start over again and over again if you never let it grow. For example, let's say you contribute 4,000 per year to your HSA for 30 years. And every year, you have 4,000 of qualified medical expenses. So in total, that's about $120,000 in total contributions and $120,000 of qualified expenses you paid for. And you're basically treating your HSA like a checking account for your medical expenses every year. But let's flip this and say that you did the same exact thing, but you paid those same medical bills out of pocket and kept your HSA dollars invested the entire time in achieved a 10% rate of return. Well, that $120,000 that you kept invested could be worth over $725,000 due to the power of compound interest. And after all of that time, if you reinvest yourself for the same, $120,000 of medical expenses you had over that period, you would still have over $600,000 of additional wealth remaining inside your HSA. That's how much more money you could have by keeping your HSA dollars invested and simply issuing a tax re-reimbursement to yourself at a later date. Now, with all of that said, how exactly does any of this work in the real world in practice? Like who qualifies to use an HSA in the first place, what are the limitations? And probably most important of all, what kind of expenses can we actually reimburse ourselves for with this account? So Let's break the rules down a little bit here. First and foremost, in order to qualify to use an HSA, you must have a high deductible health plan. The IRS definition of a high deductible health plan changes every year, okay? So you will want to keep an eye out on this. But as of 2026, a high deductible health plan has a minimum deductible of $1700 for individual coverage and $3400 for family coverage. That is is the single most important requirement in order to qualify for an HSA. From there, you can set up your own HSA for free at many places and some employees even offer this to their employees as benefits. But then there is the second major requirement. The contribution limits. In 2026, individuals with self-only coverage can contribute about $4400 to their HSA and those with family coverage can contribute about $8750. And those over the age of 55 are able to contribute an additional $1,000 on top of this. Now, remember, your contributions are tax deductible up to these limits. So even if you do not expect to have any major health expenses, you can still use your HSA as a vehicle to save on taxes and also benefit from tax-free investment growth. But remember, in order for your dollars to actually come out tax free, you have to eventually use this account for qualified health expenses. And believe it or not, what qualified as a health expense is actually quite broad. Most people are actually surprised at what qualifies here, so let's touch on that for a second. Most people think that HSA's only apply to medical things like doctor visits, dental visits, prescription drugs and medical procedures and that is true and very useful but that's only part of it. You can also use your HESA's for things like cryophoresis treatment and in some cases even massages as well as therapists, psychologists and certain weight loss programs. You can also use it to buy certain items from convenience stores like health products from CVS and even Amazon. Amazon has an entire section of their website dedicated solely to HESA eligible purchases. According to the IRS, qualified medical expenses are the cost of diagnosis, cure, mitigation, treatment or prevention of a disease. If your expense does any one of those things, then it may be HESA eligible, especially if it is prescribed by a medical professional. And these qualified expenses do not include expenses you incur for just yourself. It can also include medical expenses you incur for your spouse or any dependent that you claim on your tax return like a child or parent for example. So look, this is exactly how people are using HESA's to save on taxes, build more wealth and basically right off their health expenses. If you found this video helpful, be sure to subscribe to this channel and share this with someone you know who might be able to benefit from this. And if you need help implementing strategies just like this to reduce your taxes before this year just apply to work with my team today at mycoach.com. Thank you.