A health savings account – or HSA – can help you save money (tax-free) to allow you to cover large cost deductibles, while using a cheaper insurance policy to cover major medical bills. It may sound complicated but it’s really not. Here are a few tips that can guide you through the murk of health insurance plans and tax breaks.

Anyone under the age of 65 with a high-deductible health policy can start an HSA. You can’t be covered under another policy that isn’t a qualified high-deductible plan although you can still have other plans for disability, dental, long-term care or vision. According to About.com you can put up to $2,900 for singles with families being able to put aside $5,800. Policyholders aged 55 or older can put aside an additional $900 into their HSA. The amount you can put into your HSA can change year-to-year so it’s important to know what amount you’re allowed to set aside.

How does one go about opening an HSA account?

You can open a health savings account on your own or by opening one through your employer. You can find a list of health savings accounts at Med Health Insurance. There you can compare several policies from different companies. The list of companies offering HSAs continues to grow every month as it becomes a very popular health policy option. Many plans offered through your employer may have this HAS as an option. Talk to your company’s benefits or payroll manager to find out if this is an option or will soon become one. If your employer offers one of the high-deductible health insurance policies, you may qualify to make pretax contributions, the same way you would with a flexible spending account.