So, let's start off with Matthew's question. He says, "I'm considering an HSA," which I know you guys love. HSAs, you can speak to the advantages of that tax advantage. Exactly. But I'm worried about keeping receipts for the next 25 to 30 years. What are your thoughts on that?
Yeah, it sounds, in my opinion, more daunting than it is. I'm just going to tell you my system. Right? Yeah. So, one of the things that we have is I have a paperless management system. You know, I scan stuff in and keep it electronically. Now, I'm old school. I've got a scanner that sits on my desk. So, I get a receipt or a bill or whatever, I scan it. But a lot of the stuff I pay online, so all I do is when I pay it, I then save the invoice, the receipt that I paid it, I put the date on there and who it was I paid. Then I just drop it in a file. I just have a healthcare folder file that I keep in my computer. It's not saved locally; it's saved in the cloud for each year. So, here's my 2020 expenses, 2021 expenses, 2022 expenses, 2023 expenses. But then to make my life a little bit easier, I take it just one step farther. I keep a master spreadsheet, and each tab has a year. I just very quickly put the date, the service, the date the payment was made, who the payment was made to, and the amount. So that whenever I need to go and say, "Okay, well, how much do I have accumulated in receipts?" I don't actually have to go pull all the receipts. I know that they're in the file. I just got to go look at my spreadsheet to see how much is accumulated. This takes me next to no time at all. It's just sort of automatic for the people. As soon as I pay the bill, I do it. Now, with your phones, the fact that your phones can take a picture and scan, and you can drop it, it's easier than ever. It's just not as cumbersome as I think people think. The shoebox with the dividers has to be the big thing. You just gave them was a system. You've got to have a system that will create, organize, and make this an actionable thing that you can actually use.
I just a review for, because we know typically I say we have 40 to 50% of you have never seen our stuff. The last month, it might very well be 70% because our stats have been crazy. So a lot of you might not know the huge benefits of why health savings accounts. Step five of the financial order of operations is their triple tax advantage. What I mean by that is not only do you get a deduction off your income taxes when you contribute to a health savings account, but if you actually take the opportunity to invest the money, whatever they grow to is tax-deferred. And if you actually use them at some point in the future for qualified healthcare and medical expenses, that can be pulled out completely tax-free. And then there's a bonus. That potentially is like a Quattro tax advantage opportunity is that if you actually have an employer that has a health savings account option for you, they can fund this pre-Social Security and Medicare taxes. So there are lots of benefits that you can harness the power of Uncle Sam encouraging you to do this.
The thing we don't love about health savings accounts is that, first of all, you have to have a high deductible healthcare plan. That's step one. You can't even consider this if you don't have a high deductible healthcare plan. But the second thing is only 4% of people are actually investing the money. Most people use this as a complete clearing, meaning you put the money in the health savings account, you take the deduction, but then you take it right back out. Our plan of saving and investing that money for some future period does require you to pay your medical expenses with your after-tax money. You have to have the money out of pocket. So, I know that this is definitely a financial mutant strategy. It's probably not going to be the easiest thing to do when you're first starting out, but once you start having some success, I would encourage you to look into the saving and investing and growing your health savings account because there are some great opportunities. We just covered in on 10 surprising facts about personal finance is that if you can let your money work for you 5 years in the future, that money that account has the potential to have grown by like 23%. That's exciting. But it's not going to change your world. If you fast forward to 10 years, it's a little over 40%. But if you can wait 40 years, let your money grow, you can see that compounding growth is now allowed. Only 8% is your initial contributions. 92% of the total account value is likely the growth. So, that's why we love saving and investing and letting that money grow in the long term. But I recognize there's a lot of people just like we have different risk tolerances where you might be a person who's close to retirement might be very nervous, and they want to have more cash and they want to have more bonds and things like that. But somebody who's in their 20s is going to say, "Let it rip. I want to have as much aggressiveness as possible." The same thing could happen with the way you administer your health savings account. There's nothing wrong that you get to year 10, and you realize your account is up over 40% from your investments, that you go, "You know what? That's enough for me. I don't want to keep up. I don't want this tail dragging on for longer than 10 years." That is perfectly acceptable. So if 25 years of keeping receipts and not having a system is too much labor and too much intensity, there's nothing wrong with that. I'm just trying to give you the maximization strategy. That's what being a financial mutant is about. We educate you so you can learn, apply, and grow these concepts, figure out how this intersects with your goals, your desires, and what is your best version of you. That's what I'm trying to create. But that's why I'm hopeful the education takes you, Matthew, so you can find out what's the Goldilock scenario for you. Is it 10 years? Is it 15 years? Or is it 5 years? Maybe 20% growth is all you wanted. For more information, check out our free resources