Gen Z, Millennial Workers Spur Growth in Health Savings Accounts for New Year  

Labor Landscape

Gen Z and millennial workers, roughly in their 20s, 30s and early 40s, are fueling a boom in health savings accounts (HSA).  

Survey data from HSA research firm Devenir shows that in 2015, HSA accounts held a total of $30.2 billion in assets, of which $26 million was in deposits and $4.2 billion was invested. Estimates for 2026 show total HSA assets reaching $189 billion, comprising $94.3 billion in deposits and $94.2 billion in investments.  

Steve Morris, a retired investment planner from Oakmont, Pa, reports that HSAs are tax-advantaged medical savings that can be opened in conjunction with a high-deductible health plan (HDHP).  HSAs  may be offered through an employer whose health benefits include a high-deductible health plan option. They can also be used by others who have an HDHP for health insurance through an individual plan  or perhaps a self-employed health insurance plan.  

Market experts say that HSAs have the so-called “triple tax advantage.’’ That means that contributions are tax-deductible, while growth, dividends, and interest are tax--exempt.  Plus, withdrawals for qualified medical expenses incurred are tax-free at any time.  

The primary purpose of an HSA is to be able to save for future medical expenses. In this regard, some of these expenses may include doctor visits or ongoing prescription drug costs.  

Brett Roe, a self-enployed contractor from Sewickley, Pa , said that in many ways an HSA is  similar to a retirement account  like an IRA or 401(k),  Due to the tax-advantaged structure of an HSA, it can be a great advantage to a retirement package.  And HSA assets can be invested, allowing for powerful long-term growth toward  workers’ retirement goals.   

HSA assets reached $159 billion across 40 million accounts at midyear 2025, Devenir reported.  The survey shows investment assets drove the expansion, rising 30 percent year over year to $73 billion. Investment assets now represent 46 percent of all HSA assets.  

John Carroll of Canonsburg, Pa., a retired crane operator, said he has an HSA to help with his medical problems, namely a heart condition. According to a 2025 study by Fidelity, an average 65-year-old can expect to spend more than $172,000 on health care costs during retirement. In retirement, money can be pulled out of an HSA tax-free to cover a range of qualified medical and related expenses. These can include some Medicare premiums and a wide range of health care services.  

The U.S. Commerce Department reports that the total health benefit cost per employee is expected to rise 6.5 percent on average in 2026 – the highest increase since 2010 – even after accounting for planned cost-reduction measures. Employers estimate that plan costs could increase by nearly 9 percent, on average.  

A general rule of thumb is to have at least 10 to 12 times your annual income saved by age 67 if you plan to retire at a traditional age. For instance if you earn $150,000 a year, the retirement savings target would be between $1.5 and $1.8 million.  

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