What is HSA hack?

The "HSA hack" refers to a strategic use of a Health Savings Account (HSA) not just for health-related expenses, but also as a means to save for college. In detail, the process involves paying for medical expenses out-of-pocket currently, while preserving the receipts for these transactions. These receipts can later be used for HSA reimbursements, which are then allocated towards college tuition. This method is beneficial because the funds reimbursed from the HSA are not considered as assets or income in the Free Application for Federal Student Aid (FAFSA). This means these funds have no impact on the financial aid calculations, effectively making it a tax-advantaged way to save for education expenses later on 1.