Only half of Americans feel knowledgeable about HSAs

Only 51 percent of Americans believe they are knowledgeable about Health Savings Accounts (HSAs), according to a new joint report by the LIMRA Secure Retirement Institute and Insured Retirement Institute (IRI).

The survey found that many Americans are unaware that they can use HSA assets accumulated in their working years to pay for health care and long-term care expenses in retirement. In fact, two in five Americans mistakenly believe that balances must be spent by the end of the year, or forfeited. The growing costs of health care and long-term care have prompted many advisors to address these risks with their clients as they plan for retirement. Nine in 10 advisors surveyed say they typically discuss health care or long-term care with clients but only seveb in 10 have specifically addressed the use of an HSA. Those who do not discuss HSAs acknowledge they have insufficient expertise with HSAs. Nearly all advisors (96 percent) surveyed say they would like to learn more.

“Today, only a quarter of Americans plan to use HSA assets to fund future health care costs in retirement,” noted Judy Zaiken, corporate vice president and project director, LIMRA Secure Retirement Institute. “The findings underscore a great opportunity for the industry to educate consumers and advisors on the value of using HSAs for tax-free asset growth and as a financial hedge against retirement health care costs, which is still an uncommon strategy.”

The study found there were some groups of consumers that are more likely to be knowledgeable about HSAs than others:

  • Wealthier households are more likely to be knowledgeable about HSAs. Among households with $100,000 or more in financial assets, 65 percent are knowledgeable as compared to just 40 percent of those with less wealth.
  • Men are more likely than women to report being knowledgeable about HSAs (58 percent of men versus 48 percent of women are somewhat or very familiar).
  • Married workers report more HSA knowledge than do non-married workers (69 percent versus 52 percent).
  • Consumers with children report more HSA knowledge than those without children (55 percent versus 44 percent).

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