A health savings account plan could affect Social Security retirement

Farm Forum

Q I am considering use of a heath savings account plan at work. Using one would reduce my taxes but have a secondary result of lowering my earnings for Social Security. Can this reduce my future Social Security retirement amount?

A It potentially could, depending on the amount of money involved and for how long a time. An individual answer partly depends on the persons work record over many years. Social Security retirement amounts are based on your best 35 years of work earnings and your age, in months compared to full retirement age, when starting benefits. If earnings that are reduced by the health savings account plan are included in those best 35 years, future benefit amounts might be smaller.

The Social Security website has a Retirement Estimator calculator that could help you reach an individual answer. Part of the SSA Retirement Planner section at, the Estimator connects to a person’s actual SSA work record to provide a personal estimate. You can use the Retirement Estimator if already enrolled in Medicare, but not if now applying for or receiving SSA benefits.

Initial estimates provided are for age 62, at full retirement age, and at age 70. These assume that a person will continue earning the amount of wages or self-employment earnings most recently posted to his or her record. For different estimates, you can change either the amount of future earnings used or the age when starting benefits.

Comparing Retirement Estimator results for the same age based on the initial earnings level and then with lower or higher earnings provides approximate results of different earnings on your future Social Security retirement amount.

Actual Social Security retirement amounts consider how many months you are away from full retirement age, either younger or older, when starting benefits. The Retirement Estimator provides estimates for years such as 62, 63, 64 and older, not months. For specific months and additional information, other calculators are available in the Retirement Planner section.

Based in Grand Forks, Howard I. Kossover is the Social Security Public Affairs Specialist for North Dakota and western Minnesota. Send general interest questions to him at Read his online articles at