Here’s what happens to your HSA when you go on Medicare — and how to keep up the tax savings

Core Insights - The article discusses the implications of turning 65 and transitioning to Medicare, particularly regarding Health Savings Accounts (HSAs) and the potential loss of tax advantages associated with them [1][2][3]. HSA and Medicare Transition - Upon turning 65 and enrolling in Medicare, individuals lose the ability to contribute to their HSAs, which can impact their retirement savings strategy [1][3]. - While tax-free withdrawals for qualified medical expenses remain available, the inability to add funds may lead to a decrease in account balance over time unless investments are managed wisely [3][4]. Employer Health Plans and HSA Contributions - Some individuals may choose to remain on their employer's health plan while also enrolling in Medicare Part A, but this decision prevents further HSA contributions [4]. - Flexible Spending Accounts (FSAs) can serve as an alternative for tax-advantaged savings for those who continue working while on Medicare, with a contribution limit of $3,400 for 2026 [5]. Long-term Tax Planning - For those who enroll in Medicare and continue working, long-term tax planning becomes essential to manage expected tax liabilities throughout retirement [5][6]. - A Roth conversion is suggested as a strategy to maintain tax-free growth and withdrawals, particularly beneficial for high-income retirees facing potential tax rate increases in the future [7].