Health Savings Account plans are the fastest growing product in the health insurance marketplace. At last count, 25 million Americans were covered by an HSA plan and the account balances totaled $50 billion. That’s on a par with the gross domestic product of the entire state of Alaska. It’s more than the GDP of South Dakota, Montana, Wyoming or Vermont.

Readers of this post probably think they are quite familiar with HSAs. But did you know that:

  • HSAs are the best savings vehicle available under the tax code?
  • You can roll your IRA over into an HSA and, at some point in your life, you are foolish if you don’t?
  • The best retirement savings strategy is to put the maximum into an HSA and never spend a dime of it until you get old?
  • You can invest HSA funds just like you invest IRA funds and (again) you are foolish if you don’t?

I have to admit that I didn’t fully understand these things until I read HSAs: The Tax-Perfect Retirement Account by William Stuart. Most of what follows is based on Stuart’s analysis.