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Do workers saving in both 401(k)s and HSAs end up cannibalizing one account for the other?

Do workers who save to a 401(k) AND an HSA end up cannibalizing one account for the other?An Alight Solutions study came up with a surprising answer.

By Marlene Y. Satter | Updated on February 08, 2018
Do workers who save to a 401(k) AND an HSA end up cannibalizing one account for the other? (Photo: Shutterstock)

As people struggle to set aside enough money to see them through retirement while they’re also hoping to head off today’s and tomorrow’s health care bills, a study shows that workers who put funds into both a 401(k) and a health savings account  are saving more overall than those who just put money into a single account.

In wondering whether contribution rates to one or the other are negatively impacted when workers have the option to save to both an HSA and a 401(k), Alight Solutions conducted its 2018 HSA and 401(k) Contribution Analysis and found that on average, employees who contribute to both an HSA and a 401(k) save 8.9 percent of pay in their 401(k), plus an additional 2.9 percent in their HSA. That’s higher, it says, than the average for workers who save only in a 401(k).

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