HSA Catch-Up Contribution

The HSA catch-up contribution is an extra $1,000 a year that anyone 55 or older may put into a health savings account on top of the regular limit. For 2025 the regular limits are $4,300 for self-only coverage and $8,550 for family coverage, so a 55-year-old on family coverage can contribute $9,550. Unlike the 401(k) catch-up, the HSA amount has been $1,000 since 2009 and is not indexed for inflation.

Two details trip people up. First, the catch-up is per person, not per account, and a married couple both over 55 can each make one, but only into their own HSA. If a couple has one family HSA in the husband's name, the wife's $1,000 catch-up must go into an HSA opened in her name. Second, Medicare ends eligibility. Once Medicare Part A starts, which happens automatically for most people who claim Social Security, no more HSA contributions are allowed, and Part A can be backdated up to six months from the application date, which creates an excess contribution and a 6 percent penalty if you did not plan for it. The years from 55 to 65 are the window when the catch-up matters, and for someone who can afford to leave the money invested, an extra $1,000 a year for ten years is roughly $13,000 tax-free for medical costs in retirement, which Fidelity estimates at $165,000 for a 65-year-old.

The takeaway: if you are 55 or older and on a high-deductible plan, add the $1,000 and stop contributing six months before you plan to enroll in Medicare. Both moves are easy, and getting either wrong costs real money.