Health Savings Accounts
Use it now or use it later, your Health Savings account (HSA) will help you save for expected or unexpected medical expenses. It’s here when you need it and earns interest when you don’t. At First Western Bank, we offer local Health Savings Accounts to individuals and families across Minnesota, North Dakota, and South Dakota who are enrolled in a High Deductible Health Plan (HDHP).
Frequently Asked Questions
For 2026, the IRS set the HSA contribution limit at $4,400 for self-only coverage and $8,750 for family coverage. Individuals age 55 or older can make an additional $1,000 catch-up contribution. These totals include both your contributions and any made by your employer. Limits adjust annually for inflation, so check with First Western for current-year figures.
You qualify for an HSA if you are covered by a High Deductible Health Plan (HDHP), aren’t covered by any other non-HDHP health plan, aren’t enrolled in Medicare, and aren’t claimed as a dependent on someone else’s tax return. First Western offers HSAs to individuals and families across Minnesota, North Dakota, South Dakota, and Arizona
Qualified medical expenses include doctor visits, prescriptions, dental and vision care, hearing aids, hospital bills, physical therapy, long-term care services, Medicare premiums, and many more. Withdrawals used for these expenses are tax-free. Refer to IRS Publication 502 for the full list.
Your HSA belongs to you, not your employer, so it’s fully portable when you change jobs. You can keep contributing as long as you remain enrolled in an eligible HDHP. After age 65, funds can still be used tax-free for qualified medical expenses; non-medical withdrawals are taxed as ordinary income, similar to a traditional IRA distribution, but no longer carry the 20% penalty.
Yes. As your balance grows, you have two options at First Western beyond the interest-bearing HSA checking account. You can move funds into a 1-year HSA Certificate of Deposit for a higher rate while keeping HSA tax advantages, or work with our Trust Department to invest in mutual funds, ETFs, individual stocks, or bonds for long-term growth. Investments are not FDIC insured and may lose value.
An HSA has no “use it or lose it” rule. Unused funds roll over year after year, the account is yours to keep regardless of employer, and there’s no required distribution in retirement. FSAs typically forfeit unused balances at year-end and stay tied to your employer. HSAs also offer a triple tax advantage that FSAs don’t fully match.
Healthcare is one of the largest expenses in retirement, and an HSA offers a tax-advantaged way to plan for it. Contributions reduce current taxable income, growth compounds tax-free, and qualified medical withdrawals are never taxed. If you can pay current medical costs out of pocket, letting your HSA grow long-term can be a powerful supplement to a 401(k) or IRA. The $1,000 catch-up contribution at age 55 helps you accelerate savings as retirement nears.
You can open an HSA at any First Western branch in Minnesota, North Dakota, South Dakota, or Arizona. Bring proof of HDHP enrollment along with the standard identification required to open a bank account. A banker can walk you through the HSA checking account, CD options, and investment options through our Trust Department.
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