Whether it’s planning for future healthcare needs or managing medical expenses, more Americans are listing healthcare costs as a top concern in 2023, finds the latest research from Fidelity Investments.
Fidelity, who recently reported a 27% increase in funded health savings accounts (HSAs) to $2.8 million, as well as $16 billion in total HSA assets, finds that over half (58%) of consumers say they’ve taken steps to reduce healthcare costs in the past two years. This includes nearly one-in-five (18%) Americans who say they have foregone paying their rent, car payments, or utilities to instead cover healthcare costs.
It’s why more American workers are either opting in or asking their employers for HSA benefits, says Fidelity. According to findings, 88% of Gen Zers with a high deductible health plan (HDHP) say they’ve opened an HSA. For those nearing retirement, Fidelity finds those with an HSA feel more prepared to meet expenses in retirement and are more likely to say they expect to live a comfortable lifestyle during their later years, especially due to its triple-tax advantage feature.
“Meeting the rising cost of health care continues to be a concern for Americans, particularly as inflation impacts household budgets,” said Begonya Klumb, head of health and benefit accounts at Fidelity, in a statement. “We see time and again that savers with access to an HSA are able to use the triple-tax advantage to become better prepared for the cost of health care, both today and in the future.”
Yet, while employees are taking advantage of HSAs, Fidelity data shows that just a few offer the benefit in their workplace plan. Only 35% of employees strongly agree that their health benefits meet their own or their family’s needs, and fewer than one-in-five (17%) health benefits leaders say their company offers navigation services that help coordinate employees’ care across multiple providers.
To combat this, Fidelity urges employers to reconsider their benefit offerings, while making such features more accessible to the workplace. Then, once HSAs are offered in a workplace, marketing the tool, and implementing education can drive engagement among workers.
SEE ALSO:
- Who’s Leading in Health Savings Accounts?
- HSAs Increasingly Positioned as Retirement Savings Tools
- Fidelity HSA Assets Top $10B
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.
