My wife has a pre-tax HSA kinda thihng through work, but it’s a yearly use-it-or-lose-it proposition

HSA are different, and encourage people to set aside funds and bank them year to year. I lost several hundred dollars in my use-it-or-lose-it Flexible spending account when I got laid off. I thought I have the whole year to spend those funds, but the large print gives and the small print takes away..

But can you use HSAs to purchase health insurance?

Umm, good question that I don’t have time to google yet. We’re talking about a High Deductible Health Plan, and I don’t know if you can pay next year’s premiums out of your current (tax free) HSA. I do know that you need to establish a HDHP first, before you can qualify to open a HSA, so for the first year the answer may be no.

I’ve put off doing this for a while, but I should be blogging the process shortly.

From the Wikipedia article: “If the policyholder ends their insurance coverage, he or she loses eligibility to deposit further funds, but funds already in the HSA remain available for use.”

Wikipedia link for Health savings account. Bottom line is even if your employer does not kick in a dime and you deposit after tax funds, you still get to take the deduction on your income taxes.