Why HSA often beats 401(k) per payroll dollar
Employer HSA contributions through a §125 cafeteria plan typically reduce federal income tax, state income tax, and FICA. Traditional 401(k) reduces income tax only. At the same dollar contribution, HSA usually saves more on the paycheck.
2026 HSA limits (planning)
Self-only coverage around $4,300 and family around $8,550 (confirm IRS annual limits). Contribution eligibility requires a qualifying high-deductible health plan.
Frequently asked questions
Can I contribute to both HSA and 401(k)?
Often yes if you are eligible for an HSA and your plan allows — subject to each limit.
Does Roth 401(k) help FICA?
No — Roth is post-tax for income tax and FICA.
Are HSA withdrawals always tax-free?
Qualified medical expenses generally are; non-qualified withdrawals can be taxable/penalized.
Is this advice?
No. Educational estimates only.