Hey everyone, not sure if investor alley is the best location for this post so if you know the forum better than I do, please let me know if it would be better suited in a different topic.
A little background info: In September of this year my wife and I will be having our first child and need to move into our own insurance plan for both of us and the kiddo. We have each been on our parents' insurance until this point (only 25) so I will have to be paying for insurance for the first time. We have a fully funded emergency fund (~$40k, I live in SD and am self employed so I keep it high), we max out 401k's and IRA's, and contribute to a 529. I am trying to figure out the best option for health insurance, but am not sure what the best route would be. I like the low monthly cost out of pocket for an HMO, but also like the tax advantages of the HSA. The issue I'm running into is that the HSA payroll deduction for coverage is 2x that of the HMO per year.
Coverage Information:
Payroll Deduction:
HSA:$336 bi/weekly
HMO: $179 bi/weekly
Plan Coverage details for both are attached.
I'm not really sure how to weigh out the benefit of reducing taxable income now with the HSA, and if that justifies the higher price for coverage. Essentially if I do the HSA I will max out the allowed contribution every year ($7,900) plus the yearly coverage fees ($8,070), totaling ~$16k out of pocket - half of which I have nothing to show for. Any deductible amount I have to cover comes out of the HSA and at least I have something to show if it's not used.
However, if I do the HMO it will cost me $4,300 per year and then if I invest that same $12k into a brokerage account, it will add up pretty quickly even without the tax advantage.
Any insight to all of this or recommendations would be greatly appreciated! If I need to provide more information, let me know and I can do that too!