If you use a Health Savings Account (HSA) to manage rising medical costs, there’s good news for 2027: the IRS has raised the amount you can set aside. For adults over 50 — who tend to face higher health expenses — an HSA remains one of the most tax-friendly tools available. Here’s what’s changing and how to make the most of it.

What an HSA is — and why it’s so powerful

An HSA is a savings account paired with a high-deductible health plan (HDHP) that lets you put away money for medical costs. It’s often called “triple tax-advantaged”: contributions go in pre-tax, the money grows tax-free, and withdrawals for qualified medical expenses are tax-free too. Unlike a flexible spending account, HSA balances roll over year after year and are yours to keep.