With open enrollment season in full swing, more Americans than ever will be able to fund tax-advantaged accounts aimed at health-care costs next year.
Embedded in the so-called “big beautiful” bill passed in July are three provisions that expand access to health savings accounts, accounts available to those enrolled in a high-deductible health insurance plan.
The changes are likely to attract 3 to 4 million new HSA participants in 2026, according to estimates from Morningstar.
Like a flexible spending account, an HSA is funded with pre-tax dollars and can be used to cover medical costs throughout the year. Unlike an FSA, the money doesn’t have a “use it or lose it” provision. Rather, the funds sit in an account you own and can take with you should you switch jobs.
Another feature that sets HSAs apart: You can invest the money in the likes of stocks, bonds or exchange-traded funds. And if you invest the money rather than spending it on pressing health-care needs, that’s where some serious advantages kick in, experts say.
