Communicate with retirement options
One reason that HSA participants typically use their HSA for short-term savings might be that they’re often communicated during open enrollment alongside FSAs and HRAs. After all, HSAs are health accounts. And the administrator of your HSA might also administer your FSA and HRA. But it’s important to also communicate HSAs when you’re discussing any available retirement options to your employees, such as an employer-sponsored 401(k) or pension plans.
Set the example, and they may follow
Many employers whet their employees’ appetites for 401(k) participation by matching funds. In 2018, employers contributed an average of 5.2 percent of employee salaries into a 401(k), which may have sparked an increase in employee contributions. If you offer an HSA, do you employees have any incentives to contribute? Provide them with a contribution or match to entice them to open and contribute to an HSA.
Emphasize retirement diversification
A diversified retirement approach isn’t limited only to diversified assets. Diversifying retirement accounts also makes sense, allowing each account to focus on a certain retirement need or a specific type of investment asset. HSAs are perfectly positioned to cover healthcare retirement costs. If someone is enrolled in an HSA, 401(k), and IRA, they could use the latter two to tackle other retirement needs, such as housing and transportation.