Split out of HSA for eyes vs dental vs other medical

Background: I am self employed for the last 10 years and started using YNAB a few years ago. With each pay, I currently put a specific amount away for future dental expenses $(96), a different amount away for future eye expenses ($57)  and a third amount for medical ($50).  Each one is currently a line in my budget. We very rarely have expenses beyond our typical check ups, new glasses, and teeth cleanings etc. This has proven to be a great way to make sure I have the $ I need when it comes time to see the dentist, get my eyes checked, get new glasses etc.  And yes, if I have an unexpected bill, e.g., dental, that exceeds my budgeted amount, I take money from "To be budgeted" or another line that has more $ in it then I need it to have, and put the needed $ into the detail line item to cover the unexpected bill so my dental line item is not over spent.

New situation: As I am self employed, I can set up an individual HSA account with pre-tax dollars (with no company match and not reimbursement by anyone). Just me putting $ in it, and then using the card that comes with it, to pay for the medical, eyes and dental stuff.

Desired Outcome: Now with each pay I want to take the $ I would previously put into my budgeted line items for dental, eyes and medical, and put it into this new HSA.  BUT i still want to see the break out of how much of the HSA $ I have put in there for eyes vs the amount I put in there for dental vs the amount I put in there for medical.  That way I can decide if we have enough in there for that new pair of glasses etc.

Problem: Each of the HSA posts don't seem to address how I can track the SPLIT of $ I have put away for eyes vs dental vs medical - it seems that everyone just puts $ in there as one line in the HSA tracking account and enters each eye or dental etc expenses as they are incurred (which appears to work great to track how much you SPENT for eyes vs dental etc --- but not good to track how much you have left in there for future spend on eyes vs dental etc.)

Need Help: Sorry for the long post, but I just can't see how to keep putting $ away for eyes/dental/medical and be able to track how much I have put away or have left to spend for eyes vs dental vs medical.

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  • Resist the urge to budget by account.

    You are still putting the money into the Categories, and that is how you know how much you have left to spend. Read this: https://www.youneedabudget.com/the-relationship-between-your-budget-your-accounts-its-complicated/

    I have an HSA., I started it this year. The amount of money I have in my Medical categories is a lot more than what is in my HSA. All it means is that there may be some expenses I pay from my checking account rather than my HSA (if I need to spend it at all).

    Some folks will stuff money in to the HSA and still pay medical expenses with post-tax cash. Just because you *can* spend it today, doesn’t mean you *have* to.

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  • Sea Green Python said:
    I take money from "To be budgeted" or another line that has more $ in it then I need it to have,

     Also, this is concerning.  You shouldn't have any money left in "To Be Budgeted" This indicates that you're not following rule 1, which is give EVERY dollar a job.  If you don't know what that job is, put it in a holding category.  Some people call theirs "Stuff I forgot to budget for," I have one called "Slush Fund" which gets filled by amounts left over at the end of the month in certain categories (as well as being budgeted directly to if that didn't bring it up to a personal target I have for that fund at the beginning of the month.)  Others call it "Income for Next Month" (I also have one of those).  Whatever it is, you should move TBB to that category as soon as you get paid, if there's no other categories needing that money.  The only time you should have money in that category is right after payday, before it gets budgeted into the categories it needs to be in until the next income event.

    As far as seeing how much you put towards each medical category, I'm with Tomato Tamale here, just put it into the categories.  That will tell you how much you have available to spend in each category.

  • Sea Green Python said:
    if I have an unexpected bill, e.g., dental, that exceeds my budgeted amount, I take money from [elsewhere]

    Like most people, it doesn't sound like you're using these categories for spending guidance. I mean, you're not going to say, "Nah, I'll skip the root canal."

    That's why a split is a bit meaningless, and recommended practice is just an HSA Contributions line item. The HSA account is not part of the budget.

    If you really wanted that division, just make a second budget for the HSA alone.

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  • Don't forget the other benefit of an HSA -- tax deferred growth. Ideally, you would handle the routine medical out of normal money and let the HSA grow.

    I have a medical category (funded from post-tax income). I don't have an HSA Contribution category because I contribute with pre-tax funds and track net income in the budget. I also have a medical-reimbursement category. I'm trying really hard not to touch those HSA funds, but if I have to, that gets categorized as medical-reimb as is the inflow. I also pay these with a rewards CC.

    So yes, that does require saving more -- enough for routine PLUS money to hopefully not touch until much, much later. Not everyone can afford that, but it's something to consider as part of the overall financial picture. That tax-advantaged contribution limit/space is "use it or lose it".

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