HRE’s number of the day: 2021 HSA contribution limit

$3,600: The 2021 annual HSA contribution limit for individuals

The IRS recently announced that the annual limit on deductible contributions to a health savings account will jump by $50 for individuals and $100 for families next year. In 2021, the annual HSA contribution limit will rise to $3,600 for individuals in a high-deductible plan–up from $3,550 in 2020. Those with family plans will be able to stash up to $7,200 in 2021–up from $7,100 in 2020.

What it means to HR leaders

HR leaders are increasingly turning to health savings accounts as an option for employees to pair with high-deductible health plans. More employers also are offering contributions to employees’ accounts. Health savings accounts jumped to almost $66 billion in assets held in over 28 million accounts in 2019, according to research firm Devenir. That’s a year-over-year increase of 23% for assets and 13% for health savings accounts for the period ended Dec. 31. On average, investment account holders hold a $16,012 total balance.

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With the amount that employees can contribute increasing next year, HR and benefits leaders should be sure to relay the information to their employees–and perhaps encourage them to boost their contributions. Many experts cite the benefits of HSAs for employees. HSAs provide “tremendous opportunity to maximize their savings dollars and help them stretch further–which will only become more important as healthcare costs continue to rise,” Begonya Klumb, head of HSAs at Fidelity Investments, recently told HRE. Employees also benefit from tax advantages and as a way to save for healthcare costs in retirement.

Kathryn Mayer
Kathryn Mayer is HRE’s benefits editor and chair of the Health & Benefits Leadership Conference. She has covered benefits for the better part of a decade, and her stories have won multiple awards, including a Jesse H. Neal Award and honors from the American Society of Business Publication Editors and the National Federation of Press Women. She holds bachelor’s and master’s degrees from the University of Denver. She can be reached at