This is phenomenal analysis and hits hard on something most people don't realize untill its too late. That aggregate deductible trap is especially brutal for families with ongoing care needs since insurance literally pays nothing untill the entire family hits the threshold. The problem is social media rewards oversimplification, so all we see are the sexy tax benefits without any mention of the structural trade-offs. I've been maxing my HSA thinking I was winning, but now I'm gonna actually run these numbers for my situation.
Appreciate this. And you’re spot on — HSAs feel like a win until the deductible reality shows up.
The goal isn’t to abandon HSAs. It’s to stop treating them as universally optimal. Once you run the numbers with your usage, the answer usually gets very clear, very fast.
We've never qualified for a HSA based on the type of insurance plan we have through my spouse and often also having a FSA. Will definitely have to do more research as we approach retirement and have to start weighing more healthcare options before age 65.
Healthcare is the number one reason (though there are a few other secondary reasons) that I can't get my husband to just retire completely at 55 vs later (though I've slowly been working him down from 65 to 62 to 60). It seems like it will be our biggest expense.. So the research continues.
Great summary. Like most tax and financial advice, it can be delivered to the masses in a catchy, eye-grabbing manner, but it won't be of much practical use if not applied to an individual's specific circumstances. There is just no way around the fact that you need to know your numbers before applying data-dependent advice.
Good callout. The case study data was from Feb 2025, before OBBB passed.
Yes, HSA got some upgrades. But the fundamentals didn’t change: HSAs work best for high earners with low medical spend, long horizons, and the ability to self-insure and max the account without touching it.
I honestly wasn't trying to catch you out, I am writing my own HSA post and am an ex-claims analyst for a health insurer. I was simply trying to understand what ground your guardrails covered.
This is an excellent summary.
Appreciate the kind words, Steve.
This is phenomenal analysis and hits hard on something most people don't realize untill its too late. That aggregate deductible trap is especially brutal for families with ongoing care needs since insurance literally pays nothing untill the entire family hits the threshold. The problem is social media rewards oversimplification, so all we see are the sexy tax benefits without any mention of the structural trade-offs. I've been maxing my HSA thinking I was winning, but now I'm gonna actually run these numbers for my situation.
Appreciate this. And you’re spot on — HSAs feel like a win until the deductible reality shows up.
The goal isn’t to abandon HSAs. It’s to stop treating them as universally optimal. Once you run the numbers with your usage, the answer usually gets very clear, very fast.
We've never qualified for a HSA based on the type of insurance plan we have through my spouse and often also having a FSA. Will definitely have to do more research as we approach retirement and have to start weighing more healthcare options before age 65.
You’re thinking about this at the right time. Pre-65 healthcare is where a lot of planning mistakes happen because people wait too long.
HSAs can play a role later, but only if the coverage structure lines up.
Research now = fewer surprises later.
Healthcare is the number one reason (though there are a few other secondary reasons) that I can't get my husband to just retire completely at 55 vs later (though I've slowly been working him down from 65 to 62 to 60). It seems like it will be our biggest expense.. So the research continues.
Great summary. Like most tax and financial advice, it can be delivered to the masses in a catchy, eye-grabbing manner, but it won't be of much practical use if not applied to an individual's specific circumstances. There is just no way around the fact that you need to know your numbers before applying data-dependent advice.
Exactly.
Catchy advice travels faster than correct advice.
Tax strategies only work in context, and HSAs are especially data-dependent. Until you run your premiums, usage, and cash flow, it’s just theory.
May I ask a question? Did you run these with the new OBBB rules in place? You didn't specify...?
Good callout. The case study data was from Feb 2025, before OBBB passed.
Yes, HSA got some upgrades. But the fundamentals didn’t change: HSAs work best for high earners with low medical spend, long horizons, and the ability to self-insure and max the account without touching it.
I honestly wasn't trying to catch you out, I am writing my own HSA post and am an ex-claims analyst for a health insurer. I was simply trying to understand what ground your guardrails covered.
All good! I didn't take offense to it. It's a great note worth pointing out.