New HSA Contribution Limits Released for 2025 and Encouraging Smart Investment Choices

The IRS has announced the 2025 contribution limits for health savings accounts (HSAs), which have been increased for both self-only and family plans. For 2025, the limit for self-only coverage will be $4,300, while those with family plans can deposit up to $8,550 into their HSAs. Catch-up contributions for savers age 55 and older will also be released later this year.

To contribute to an HSA, individuals must have an eligible high-deductible health insurance plan with a minimum deductible of $1,650 for self-only plans or $3,300 for family plans in 2025. HSAs offer three tax benefits: an upfront deduction for contributions, tax-free growth, and no taxes on withdrawals for qualified medical expenses.

While HSAs offer tax advantages, only a small percentage of participants invest their balance according to a 2023 survey from the Plan Sponsor Council of America. Many HSA savers miss out on growth opportunities by leaving their savings in cash. A finance expert recommends writing a will as it goes beyond just financial planning.