"A traditional 401(k) is taxed once on the way out, while a Roth 401(k) is taxed once on the way in. The HSA, used correctly, is taxed zero times: contributions are deductible, growth is tax-free, and qualified medical withdrawals are tax-free."
"For a household in the 24% federal bracket, the 2026 family contribution limit of $8,750 produces roughly $2,500 in combined federal and state tax savings in year one, before any investment growth."
"Assume the physician maxes the family limit every year from 45 to 65 and earns 7% inside the account. The base stream of $8,750 a year for 20 years compounds to roughly $358,710."
"Every dollar paid from the HSA in retirement is a dollar that never ran through ordinary-income tax. In a 24% bracket, that is a 24% haircut avoided on the way out, plus state tax in most jurisdictions."
A physician earning $400,000 should prioritize contributions to a Health Savings Account (HSA) over a 401(k) after the employer match. HSAs offer triple tax advantages: deductible contributions, tax-free growth, and tax-free withdrawals for qualified medical expenses. For a household in the 24% federal tax bracket, contributing the maximum limit can yield significant tax savings. Over 20 years, consistent contributions can grow substantially, providing a tax-efficient way to cover healthcare costs in retirement, avoiding ordinary income tax on withdrawals.
Read at 24/7 Wall St.
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