HDHP + HSA + Roth TSP: The ‘Triple Tax’ Strategy Explained

November 12, 2025

Most feds know the TSP is a powerful retirement tool.

But there’s a little-known combination tucked inside your health plan options that quietly delivers three layers of tax benefits...

And can work in tandem with your Roth TSP to build serious wealth.

It’s not new. But it’s widely underused.

And this month (Open Season), you have the chance to activate it.

The Overlooked Power Trio

Enter the HDHP + HSA + Roth TSP stack. 

Three tools, one strategy:

  • ✅ HDHP (High Deductible Health Plan): Lower premiums, higher deductible. And in many cases, your FEHB plan adds money into your HSA each January.

  • ✅ HSA (Health Savings Account): The only account in the federal landscape with triple tax benefits. Tax-free in, tax-free growth, and tax-free withdrawals for medical expenses.

  • ✅ Roth TSP: Funded with after-tax dollars now, completely tax-free in retirement.

Done right, this combo can give you tax-free income, medical flexibility, and long-term growth with very little tradeoff.

The Strategy in Action

Let’s break it down with a real-world federal playbook:

  1. Switch to an HDHP during Open Season
    ➤ Lower premiums compared to a PPO
    ➤ Your plan may deposit $600–$1,200/year into your HSA automatically

  2. Max out your HSA (if eligible)
    ➤ 2026 limits: $4,300 self-only | $8,550 family (+$1,000 catch-up at 55)
    ➤ Invest the funds—not just stash in cash
    ➤ Save receipts now, reimburse yourself years later (tax-free)

  3. After getting your TSP match, direct new contributions to Roth TSP
    ➤ You’ve handled medical tax-free (HSA), now build income tax-free (Roth)
    ➤ Roth TSP shines for those expecting equal/higher tax rates later

This setup gives you a medical tax shield today and retirement tax armor later.

“How Do I Know If It’s Right for Me?”

Ask yourself:

  • Can I afford to pay routine medical expenses out of pocket, and let my HSA grow?

  • Am I looking for a way to build more tax-free income outside of my TSP?

  • Am I willing to revisit my health plan and TSP allocation once a year?

If yes to all three, this strategy can be one of the most tax-efficient wealth moves you make, especially if you’re still 5–15 years from retirement.

Your move this month…

Compare an HDHP with your current FEHB plan.

Run the numbers.

Then decide: are you ready to triple-stack your tax benefits?

Best,
—FWR