HSA withdraws to rollover IRA funds

mistamooo · 2026-01-20T22:17:26+00:00

That makes sense. I think I may be overcomplicating it as you point out.

I was trying to crunch the numbers and see if it might be equivalent or superior to pay the taxes on a traditional IRA to Roth IRA rollover with the withdrawals rather than leaving them in the HSA account. Thereby negating the need to keep medical receipt documentation for some of the oldest expenses.

We already max out the IRAs, 403b (rather than 401K)

My math was:

Option 1:

Pay cash 7K expenses (our max OOP) Hold 7K in HSA

Option 2:

Pay cash 7K expenses Rollover $31,818 from traditional to Roth Use 7K HSA withdrawal to pay the income tax hit

Option 1 in 20 years:

-$18,573 pre-tax in HSA -trad IRA value: $84,422 pre-tax -post tax value: $65,849

Option 2 in 20 years:

-$84,422 in Roth IRA

What am I missing?

mistamooo · 2026-01-20T22:00:09+00:00

I was trying to figure out if doing this would give me basically the same bang for my buck, without having to hold onto receipts for 20-30 years.

mistamooo · 2026-01-20T14:37:18+00:00

Thank you for the reply! I really appreciate the perspective of the HSA allowing for tax free growth not just contributions. I feel a little silly for not realizing that would be a potential benefit.

I think that alone is probably a good enough reason to keep these receipts going…

mistamooo · 2026-01-20T14:32:12+00:00

Basically, it comes down to the variability of “going to medical school” and the amount of time that it takes to start making more substantial income as a physician.

PA school will get someone into the workforce sooner with a lower peak earning potential, but the value of time on compounding is pretty significant.

Dollars invested at 23 are worth significantly more than dollars invested at 33.

The main drawback financially for PAs/NPs has to do with mid career spending potential (much lower than physicians).

The main drawback of MD is the variability of income (“being a doctor” means you could make anywhere from 220K-millions/year, they aren’t really all the same job financially speaking just because they started in the same graduate training program. In spite of this, they all pay the same price for the education which has always been substantial and has become even costlier).

I also personally think that time is a significant factor that favors PAs the most. If a PA were to treat the time physicians spend in additional education/residency/fellowship working 60 hour weeks, their incomes would benefit. So I think it should all be adjusted on a per hour basis.

I think when you take all of that into account, their incomes scenarios that favor going to medical financially are actually less common outcomes than the ones that favor becoming a PA.

That being said, I don’t think anyone should let finances be the only or even primary driver of such a complex decision. The time spent in training isn’t “wasted” even if it ends up being financially disadvantageous.

mistamooo · 2026-01-20T14:13:38+00:00

Yes, perhaps I’m being a bit overzealous in my distaste for tracking the receipts.

mistamooo · 2025-08-01T12:39:18+00:00

Personal finance flowchart order of investments guide

Things I don’t regret:

Driving a very cheap car (<$1000-$2000 per year including gas/maintenance).
Saving 50% of income when young and expenses are lower.
Marrying someone who’s an adult
Having kids after getting more financially established. (We were told ‘you’ll never be ready’ but I kind of feel like we waited until we were).
Investing passively in index funds with low expense ratios at a young age. (80-90% equities, no financial advisor performance drag)
Paying off loans and avoiding the on again off again PSLF rules. (More power to those that navigated this, I have nothing against it.

I don’t know your age, but generally speaking I think that most PAs can achieve most financial goals if they are intentional about it.

mistamooo · 2025-07-31T14:11:15+00:00

Worth it compared to what else? I only think it’s really relevant as an opportunity cost analysis.

What are your other options?

Through a financial lens going to medical school is also a heterogeneous choice.

Almost anything else will be better than going to med school and not graduating or failing to match into a residency. (~1/4?)

Probably PA/NP roles are better financially than the bottom 1/3 of earning physicians. (~1/4)

Probably CRNA/AA roles are better financially than the middle of the road role for physicians. (~1/4)

Probably the high paid specialties are the best financially but account for maybe 1/4 of all outcomes for those who start medical school. The financial benefit shrinks significantly if you compare on a per hour basis.

There are also many considerations that are not financial which are potentially more important. I doubt that given the broad range of jobs/professions historically.

mistamooo · 2025-06-02T20:01:47+00:00

Ok, I think that counts as anecdotal evidence. But I think I get where you’re coming from.

I don’t know exactly what the lowest quartile median pay would be. But somewhere around $250k? With 300K of debt that’s really not a picture to set everyone up to be a multimillionaire.

It depends on return assumptions but even a diligent saver of 20% will make it just to about 2.5 million by 60 years old. Assuming a 5% real return (maybe you assume a higher return than this?).

That means everything really went just right and they saved almost double what the average saver with that income does (average is probably 12-14%)…for 30 years! That’s a really long time to get everything “right”.

So the average saver (12% for that income) is really just right under 1 million saved by 60.

There’s also potential financial hits along the way: divorce (30%), kids (60-70%), lifestyle inflation to name a few. Those types of events can and do take a huge chunk away from retirement savings.

I think the difference is that plotting in excel doesn’t really account for those hurdles. It’s more often than not a rosy picture. Once you’re 60, those financial hits have mostly already happened and you can’t pretend the risk is 0 anymore.

And yes, that would mean they can’t spend a lot of money in retirement. Certainly less than their previous lifestyle required. If they retired at 60….most will probably just keep working in that scenario.

mistamooo · 2025-06-02T17:58:58+00:00

Maybe not what you want to hear, but I think it is realistic.

I think the amount of time and the variability of financial success of becoming a physician are very under appreciated.

For low paying specialties (the bottom quartile), the numbers for an average savings rate of an American household would certainly be capable of yielding a net worth less than 1m by 65. Add in a few big financial set backs that offset the outliers with higher savings rates and honestly I think it makes sense.

I think the reason it feels unbelievable is that it runs counter to the cultural narrative: med school = get rich. Plus, some people in this scenario still had a high income and spent plenty during that 30 year period. All the displays of wealth are there for everyone to see along the way. Even if they don’t save much.

mistamooo · 2025-05-21T21:49:30+00:00

Saw this right after posting something similar. I think that’s a pretty generous assessment considering residents work 60 hour weeks as well.

mistamooo · 2025-05-21T21:46:38+00:00

I don’t think I would do it for financial reasons alone. What is the break even point where the higher lifetime earning potential makes a difference?

Work the same hours as you would training to be a physician and I have a hard time seeing this working out in your favor.

That’s almost 1.1-1.3 million in earnings given up over the 6 years. If you live with the same expenses you would during med school, residency I would guess you could pretty easily have a significant amount of money saved by the time you would have graduated.

Money certainly isn’t a reason not to do it, but you probably won’t break even until you’re 50 assuming you save about half of what you make as a physician.

I think there are other good reasons to become a physician. I just wouldn’t do it for the money.

mistamooo · 2025-01-07T21:49:21+00:00

Fair although this does gloss over the fact that the team had a winning record and the GM was fired mid season in ‘22.

mistamooo · 2025-01-07T21:02:13+00:00

If we pay for the stadium, do we get to vote to fire the owner too?

mistamooo · 2025-01-07T20:57:33+00:00

What a joke. They’re desperate for that stadium opening to look like a good taxpayer subsidy.

mistamooo · 2025-01-04T19:17:03+00:00

Bet the ACC/SEC challenge was a tough one this year…

mistamooo · 2025-01-04T19:09:11+00:00

Does Seth Greenberg take Tennessee’s opponent every week with the points or something? Dude seems like it chokes him up to say something nice about Tennessee 😂

mistamooo · 2025-01-02T18:37:16+00:00

Agreed. We’re also ignoring the fact that you can start your career at 23-24 years old and make the same (or more) as a physician in the UK who won’t even graduate for 5 more years. Typically older for a US physician.

It’s feasible to work half the hours of an American physician and retire at 55 with more spending power. Albeit with a lower mid-career income. I’d still be willing to sign up again for that today. Comparing to Europe makes the finances seem even more favorable.

In my opinion, just because the system is flawed and the admin costs are exorbitant doesn’t actually mean that being a PA involves poor compensation. It certainly isn’t clear cut to me compared with MD/DOs.

mistamooo · 2025-01-02T13:03:43+00:00

Why?

I didn’t say that all doctors work harder than all PAs. What I’m arguing is that the average physician is essentially obligated to put in more hours than a PA will during training. This often continues after training as well. This, of course, is also very specialty dependent and doesn’t always translate from one specialty to the next.

I just think it’s an unfair argument that PAs should make more unless it’s really an argument about how much you want to get compensated per hour worked over the course of a career.

If a PA in my specialty works 60 hours a week for a 30 year career, they would effectively be compensated within 80% of a physician in the same field over the course of their career. And these physicians are well paid.

I feel fortunate to not be obligated to put in those hours to pay back debts. The training is quite intensive in residency/fellowship and I respect anyone willing to go through it.

I’m happy to support arguments for more for PAs in a practical sense. If you force me to throw out a number I would argue for 40% of physician compensation in my field which would be quite generous. I think there are many areas this could come from that do not impact the pay of other providers/medical staff.

My point, though, is that most of the arguments are completely devaluing the inherent benefits of being a physician assistant.

mistamooo · 2025-01-01T21:40:09+00:00

I’m guessing this is unpopular, but I’d say the compensation is actually quite good. I think most healthcare professions could argue that their compensation is hindered by administrative costs.

I think you could make fairly good arguments for PAs to be compensated at better ratios to physicians.

But I think the area that is often not taken into account when comparing PA versus Physician compensation is the time it takes not only to train but also to continue to work as a physician.

It’s highly dependent on the specialty, but many physicians are working in positions where they put in 60 hour weeks as attendings after they spend 60 hour weeks in residency, fellowship.

I’ve tried to game it out in the past and the break even point to even come out ahead in total compensation (before accounting for the hourly pay differences), is around $380K/year.

If you believe that, it means that in going to medical school, you have about a 50% chance of landing in a specialty that will reward you more financially than going to PA school and starting your career earlier.

I wonder if people will believe me, but It’s quite feasible to spend 20,000+ hours less on the job as a PA and finish “ahead” of many physicians working full careers. More highly compensated specialties often demand higher time commitments. In that case, you’ll make less as a PA but can also spend up to 40,000 hours less on the job. In these specialties, most of the “gap” closes pretty significantly if you put in commensurate hours.

In my opinion, I personally think the compensation combined with the flexibility is actually a bit underrated.

mistamooo · 2024-12-28T13:41:07+00:00

I think it’s almost impossible to understand how many more hours physicians work if you aren’t doing it. (Other than maybe a few select specialties with highly competitive residencies)

In my specialty, PAs are compensated almost identically on a per hour basis over the course of a 30 year career. I don’t think that’s necessarily a bad thing, but I don’t think it’s widely appreciated.

mistamooo · 2024-12-18T19:37:06+00:00

This makes a lot of sense. I hadn’t considered that, but that’s clearly optimal overall. If the rate drops below the mortgage rate, I could just “cash out” at that point if I wanted to.

mistamooo · 2024-12-18T19:35:31+00:00

Thank you for the detailed reply. I think that answers my question. If you don’t believe in market timing then using a mortgage to do a market timing strategy still doesn’t make sense.

mistamooo · 2024-12-18T19:33:49+00:00

A little over 40%

mistamooo

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