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1. 

   Ralphy
   

   Journeyman
   Joined: Jul '10
   Posts: 191

   It looks like I'll be needing some expensive dental work in the near future (poor preventive care on my part, I'm afraid). Is it better to pay for that out of pocket or from my HSA? I had read once that if you could afford to pay out of pocket, you should leave the HSA alone and treat it as extra IRA space. Is there a good rule of thumb to follow here?

   Posted 11 months ago #
2. 

   Mo
   

   Master
   Joined: Jul '10
   Posts: 442

   A previous thread:
   http://forum.earlyretirementextreme.com/topic.php?id=2316

   Using your HSA to pay the expenses, if qualified, means that you will never pay any taxes on that income.

   If you leave the money in the HSA and use it as extra IRA space, you'll likely end up paying some amount of tax on the income when you receive it.

   Posted 11 months ago #
3. 

   Dragline
   

   Master
   Joined: Aug '11
   Posts: 959

   I use the HSA for these sorts of things.

   Posted 11 months ago #
4. 

   Ralphy
   

   Journeyman
   Joined: Jul '10
   Posts: 191

   Thanks for the link, Mo.

   Posted 11 months ago #
5. 

   Mo
   

   Master
   Joined: Jul '10
   Posts: 442

   I've thought this through many times over, and generally come to the conclusion that one should use the HSA to pay medical costs as the costs arise.

   However, if one can invest the HSA funds and earn a return greater than the cost of medical services inflation, perhaps investing the HSA funds is the way to go. Based on the past 30 years though, if you can beat medical inflation, please take me on as a client.

   Posted 11 months ago #
6. 

   Seabourne
   

   Novice
   Joined: Jul '10
   Posts: 25

   Be sure that you consider any extra costs - my HSA plan (through work) has a $3/mo fee if the account has less than $3000. Also, since I believe that you can use HSA funds for COBRA premiums, I don't expect to have a problem spending them at some point (and thus avoiding taxes), so I tend to treat the account as another form of ROTH (i.e. post-tax money)

   Posted 11 months ago #
7. 

   Mirwen
   

   Journeyman
   Joined: Jun '11
   Posts: 169

   I pay for everything out of my HSA. However, according to the rules, you can reimburse yourself from the HSA at any time for expenses incurred while you had the HSA, whether or not it was funded at the time. So, if you don't know what you want to do, pay out of pocket and save the receipt. You can reimburse yourself for it later (even several years later) if you decide that's best.

   Posted 11 months ago #

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