Can HSA funds be invested?

Yes, an HSA offers significant tax advantages and provides opportunities to invest in mutual funds. If you’re looking for an additional way to plan for retirement, an HSA may provide you with another means to save for your retirement goals.

There is no time limit on when you can be reimbursed for eligible expenses, you can continue to invest your funds until you truly need them. For example, if you opened your HSA in January 2021 and had eligible medical expenses in June 2021 but decided to pay out-of-pocket, you can be reimbursed for those funds months or even years later. This is a great way to utilize your HSA as a savings tool for retirement. If you reach retirement age with years’ worth of eligible medical expenses, you can still receive reimbursement for these expenses free of taxes. The main thing to remember when applying this strategy, is to ensure you keep all your medical receipts and documentation in case of IRS audit.