Gen Z Boosts HSA Adoption: 5 Ways to Strengthen Participation

Health savings account (HSA) adoption is climbing fastest among Gen Z and Millennials, according to a new national survey from HealthEquity – a signal that younger employees are rethinking how they prepare for rising healthcare costs in 2026. But while more are opening HSAs, many still struggle with financial anxiety and hesitation to seek care when money is tight.

That is where HR has leverage. How HSAs are set up and explained will determine whether young workers simply enroll or actually use and fund the accounts. HR teams that act now on messaging and employer contributions can start shaping participation well before 2026 plan year changes roll out.

Generational Shift in HSA Adoption

Younger workers are at the center of the HSA story, leading the way in adoption, according to the Fall 2025 Healthcare Affordability Pulse. Specifically, 56% of Gen Z and 50% of Millennials report having an HSA compared with 35% of Gen X and 24% of Baby Boomers. 

Younger cohorts now make up roughly 54% of the U.S. workforce, so benefits decisions increasingly affect employees who are still building basic financial stability. 

“We are seeing a generation that is financially engaged and taking advantage of tools like HSAs earlier in their careers, but they are also carrying a heavier burden of economic anxiety,” Scott Cutler, HealthEquity President and CEO, said in a press release. “Gen Z and Millennials know they need to save for healthcare and are doing their part, but they are doing it in a very different economy, one where higher costs and uncertainty are creating real stress that follows them into the workplace. Giving them simple, portable ways to save and pay for healthcare is one of the most important steps we can take to support their financial health.”

Benefits Literacy and HSA Preparedness

One bright spot for HR is that younger workers appear more benefits literate. In the survey, 53% of Gen Z employees and 62% of Millennials said they understood their benefits well or extremely well, compared with 47% in both Gen X and Boomers. Employees with HSAs also reported feeling more prepared for medical costs, routine or unexpected.

For HR teams planning 2026 benefits communication, this points to a chance to guide workers who are open to using tax-advantaged accounts. The hard part is helping employees move from signing up to choosing contribution levels and understanding long-term advantages like rollover and compound growth. 

Financial Stress Shows Up at Work

Still, the report ties financial stress directly to focus and performance at work. About 84% of Gen Z respondents said they’re concerned about the economy and personal finances. Younger workers were more than twice as likely as older colleagues to say money stress impacts their ability to focus at work.

HR leaders who track engagement and attendance may see this firsthand, since money stress often shows up as distraction and uneven performance. 

Thin Safety Nets and Delayed Care

Savings shortfalls compound the problem. Among Gen Z, 36% said they have less than $500 saved for medical emergencies. Small safety nets make employees more likely to delay care, skip appointments or reduce prescription use. When untreated health conditions escalate, HR inherits higher claims costs, lower productivity and greater long-term absence risk.

Meanwhile, healthcare spending continues to rise across the system. U.S. healthcare spending climbed 7.5% in 2023 to $4.9 trillion, or about $14,570 per person. Employers expect higher healthcare costs in the next few plan years. In that environment, high deductible plans and HSAs stay appealing, but only when employees understand how to use them and feel able to fund them over time.

The survey suggests HR influence matters. Respondents who said they understood their benefits well were less likely to report that financial stress affected work performance. That link elevates benefits education from an annual open enrollment task to a year-round retention strategy.

“Healthcare affordability is not a niche issue; it is a universal stressor affecting Americans across every demographic and every generation,” Cutler continued. “The good news is that HSAs can help improve financial preparedness. But this research makes clear that benefits education and employer support are critical to helping people not just save, but feel more secure, something that feels even more important given that open enrollment is still happening right now for the majority of Americans.”

Turning HSA Enrollment Into Real Participation

HSA adoption alone isn’t the win – employees save more when they understand how HSAs work and when funding feels attainable. Here’s how HR can help:

• Use micro-messages year-round. Replace one-time open enrollment pushes with short reminders throughout the year.
• Give real-dollar examples. Help employees visualize realistic HSA contribution levels.
• Segment messages by funding behavior. Target employees who open HSAs but rarely fund them.
• Highlight employer matches or seed contributions. Frame them as immediate financial wins.
• Connect HSAs to financial wellness. Integrate into broader money management education.

Gen Z and Millennials are now the majority of benefit decision makers. Their habits may shape the next five years of plan design. When HR stays in touch year-round and nudges early HSA saving, fewer employees skip or delay care because of cost, and financial security improves across the workforce.

The survey shows a mixed picture. Young employees are using HSAs, but many still feel financially vulnerable. If HR can close the knowledge and savings gap, employers may gain a healthier, more confident workforce in return.