Maximize IRA and HSA Contributions Before Tax Day

Tax Day is fast approaching — it’s time to take stock of opportunities to reduce your tax burden and grow your savings. Two often-overlooked tools, the Individual Retirement Account (IRA) and the Health Savings Account (HSA), offer unique tax advantages that can have a significant impact on your financial health. Whether you're planning for retirement or managing healthcare costs, maximizing your contributions to these accounts before April 15, 2025, is a step worth taking.

Maximize Your IRA Contributions

The deadline for 2024 IRA contributions is April 15, 2025. You can contribute up to $7,000 if you're under 50, and $8,000 if you're 50 or older. Depending on your income and filing status, these contributions may qualify for tax deductions, which can reduce your taxable income while bolstering your retirement savings. Be sure to verify your eligibility for a Roth IRA or traditional IRA to make the most informed decision.

Contribute to Your HSA

Health Savings Accounts offer triple tax benefits: contributions are tax-deductible, withdrawals for medical expenses are tax-free, and the account grows tax-free. April 15, 2025, is also the deadline for 2024 HSA contributions, with limits set at $4,150 for individual coverage and $8,300 for family coverage. If you're 55 or older, you can make an additional catch-up contribution of $1,000. HSAs can be a powerful tool for saving on both short-term medical costs and long-term healthcare needs. For example, if HSA funds are not immediately spent, they can grow over time, providing a robust reserve for future medical expenses.

It's wise to consult with a financial advisor or tax professional to determine your eligibility and contribution limits. Acting before April 15, 2025, can ensure you take full advantage of these savings strategies. To avoid the last-minute rush, double-check your account balances and consider making your contributions today.