An HSA account is an excellent savings vehicle for healthcare costs during retirement, but few people have discovered that they can maximize their account’s long-term savings potential by investing their contributions in stocks, mutual funds and other investment vehicles.

While only 4 percent of HSA participants leveraged investments in 2017 (per the Midyear Devenir HSA Market Survey), 16 percent of all HSA assets, or $6.8 billion, were invested last year. This represents a growth of 44 percent year over year—and an enormous untapped opportunity for account holders, investment firms and the healthcare benefits market.

Studies show that HSA accountholders who take advantage of investments have substantially higher account balances. As reported by the Employee Benefit Research Institute (EBRI), HSAs opened in 2016 with an active investment account ended the year with an average balance of $5,197 compared to an average of $970 in HSAs with no investment account. Over time, the savings advantage continues to multiply, as evidenced by the performance of more seasoned HSAs with an investment account. Those opened in 2005 had a 2016 end-of-year balance that averaged $31,239 compared to average balances of $7,233 in accounts without investments.