There is a common perception about Health Savings Accounts, and it goes something like this: health insurance costs are already so high, how can I pay for my health insurance and put $3,000 in a health savings account on top of the expensive premium?

The source of the $3,000 comes out of the cost of the traditional health insurance premium, so instead of giving money to an insurance company in the form of high monthly premiums, you are cutting your insurance bill, and putting some of the savings in a tax-free account to spend to meet you deductible.

According to Steve Davis, Editor of Inside Consumer-Directed Care, in an article titled, Banks Could Give Insurers a Run for their HSA Money by Selling Health Insurance, Golden Rule Insurance HSA Qualified Health Plans are 45% to 55% less than traditional, high premium, low deductible plans.

“UnitedHealth Group, the nation’s largest seller of HSA-qualified plans, says its plans (sold through its Golden Rule subsidiary) typically cost 45% to 55% less than its more traditional coverage options, according to spokesperson Ian Stanton. As of Jan. 1, more than 1.3 million lives were covered by one of United’s HSA-based plans.”

Those savings off a traditional health insurance plan, if put into an HSA could help baby boomers prepare for their health care costs in their retirement.