Is a high deductible health plan (HDHP) worth it? For our household, the total yearly cost of an HDHP came out about the same as our old traditional plan, two years in a row. The difference: the HDHP gave us access to a Health Savings Account (HSA), which is pre-tax going in, grows tax-free, and comes out tax-free for qualified medical expenses. In this episode, I walk through how we compared plans, who is eligible for an HSA, the 2027 contribution limits, and the strategy most people miss: paying medical bills out of pocket, saving receipts, and letting the HSA keep growing. I also cover what changes at age 65 and what happens to an HSA when you die. Open enrollment is happening now for many employers, and the Federal Benefits Open Season runs November 9 to December 14, 2026. QUICK ANSWERS - 2027 HSA contribution limits: $4,500 self-only / $9,000 family, plus a $1,000 catch-up at age 55+. Employer or plan contributions count toward the limit. - 2027 HDHP minimum deductible: $1,750 self-only / $3,500 family. Out-of-pocket maximum: $8,700 / $17,400. - You can't contribute if you're enrolled in Medicare, covered by a spouse's general-purpose health FSA, or claimed as someone else's dependent. - Before 65, non-medical withdrawals are taxed as income plus a 20% penalty. After 65, the penalty goes away and non-medical withdrawals are taxed like a traditional 401(k). Qualified medical withdrawals stay tax-free at any age. - At death, a spouse beneficiary inherits the HSA as their own. A named non-spouse beneficiary receives it directly (not through probate), but the full balance becomes their taxable income in the year of death. CHAPTERS 0:00 Why HSAs matter during open enrollment 0:56 We ran the numbers: HDHP vs. our old plan 1:41 Who is eligible for an HSA 2:01 How the high deductible works 2:43 The triple tax advantage 3:02 2027 HSA contribution limits 3:44 When an HDHP isn't the right fit 4:10 Pre-tax payroll contributions 5:04 The HSA mistake most people make 5:57 Our receipt-tracking system 7:00 Withdrawals before vs. after age 65 7:48 What happens to an HSA when you die 8:49 What our family does 9:27 Open enrollment reminder 10:10 Disclosures RESOURCES How much emergency fund you actually need: https://engineeredwealthmanagement.com/how-much-emergency-fund-do-you-need/ Is your health an investment?: https://engineeredwealthmanagement.com/is-your-health-an-investment/ CONNECT Website: https://engineeredwealthmanagement.com/ Schedule a call: https://engineeredwealthmanagement.com/schedule The Blueprint newsletter (monthly): https://engineeredwealthmanagement.com/ Apple Podcasts: https://podcasts.apple.com/us/podcast/engineered-wealth/id1875623563 YouTube: https://www.youtube.com/@EngineeredWealthManagement Facebook: https://www.facebook.com/EngineeredWealthManagement/ Instagram: https://www.instagram.com/engineeredwealthmanagement/ DISCLOSURES This content is for educational and informational purposes only and is not personalized investment, tax, or legal advice. Every situation is different; consult your own qualified financial, tax, or legal professional before making decisions. Invested HSA funds are subject to market risk, including possible loss of principal. HSA tax treatment varies by state; California and New Jersey tax HSAs at the state level. Engineered Wealth Management LLC is a fee-only registered investment adviser. Registration does not imply a certain level of skill or training. Disclosures: https://engineeredwealthmanagement.com/privacy-policy/ Form ADV: https://adviserinfo.sec.gov/firm/summary/338494
