11 Ways to Save Money So You Can Retire Early

11) Open a Health Savings Account

Otherwise known as a HSA, this is an account that’s known in inner circles as the most tax-friendly investment. How does it work? A Health Savings Account can be opened when an employer offers high-deductible health care coverage.

Contributions to an HSA are tax deductible and the interest earned on the money isn’t subject to federal tax. This account can be used to pay for qualifying medical expenses (including dental and vision) or insurance deductibles. This is especially important for retirees because the average couple of 65 years old needs several thousand dollars in medical expenses. In short, HSA are a great tax-free way to save money for your health care needs during retirement (which you’ll more than likely have). Keep in mind, if you withdraw the money for non-qualifying medical expenses the money is subject to your income rate tax.