Where to set up an HSA?

Submitted by Available_Market9123 t3_zzd6yx in personalfinance

I'm interested in setting up an HSA (Health Savings Account) but not sure where to do so. What do you guys use?

I have investments at vanguard, so that was my first preference, but it doesn't look like they offer that. I also have accounts at Ally and Santander, although I'm not a fan of the latter.

I have read good things about Fidelity, so that's my next step but I do hate to open up an account with yet another financial institution.

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KoastPhire t1_j2avtw4 wrote

Mine is part of workplace plan through optum Bank for NY wife and associated bank for me.

Do you have an eligible plan to participate in HSA?

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Available_Market9123 OP t1_j2aw3dr wrote

No, I'm a freelancer atm so I don't even have a specific "work"

Yes I do have an eligible plan (or at least I think I do) it says "HSA" on the card and has a pretty high deductible (something like 7k, was purchased through a state exchange)

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Select-Cost-2237 t1_j2b369k wrote

So an HSA is something add money to usually before tax. It’s away to be able to save enough so when you need to hit an absolutely outrageous $7000 deductible you’ve saved enough. 7k?….That’s honestly just not right to hit that deductible I would be spending somewhere around a 7th of my take home. Less than 7 MRI’s probably a lot less since when I seen my explanation of benefits a few years ago it was around a G. My Adair when it first came out I was uninsured was $260. I hope you ever need an epi-pen and never let an ambulance take you anywhere unless you’re not able tell them no.

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dcdave3605 t1_j2b6yw5 wrote

Fidelity. But make sure you have an actual HSA eligible/ qualifying HDHP plan. It will have zero first dollar coverage (nothing paid by insurance before the deductible) among other criteria.

Fidelity is the cheapest option with good investment options.

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Available_Market9123 OP t1_j2b8klg wrote

0 first dollar coverage and it says "HSA" on the card. Anything else I should look for?

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dcdave3605 t1_j2baogd wrote

Nope that's the gists. keep receipts so you can reimburse anytime in the future.

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SconiGrower t1_j2ay447 wrote

I use Fidelity for my HSA and it's pretty good. I also have my taxable and retirement investments with Schwab and my emergency fund split between Ally and Treasury Direct, so I know how you feel about too many accounts. I think the tax benefit to an HSA is great enough to be worth the extra login information and monitoring demand. You could consider moving your investments from Vanguard to Fidelity, but you will still have to manage additional account statements and tax forms either way.

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Available_Market9123 OP t1_j2b0o4r wrote

Thanks for the feedback! 2 questions:

  1. I didn't know that it was possible to migrate funds from vanguard to fidelity--can yoh manage this without cashing out/incurring taxes (its a taxable account)

  2. Ive never used treasury direct, what is the advantage? I bonds?

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SconiGrower t1_j2b2n7f wrote

You can see if an ACATS transfer is an option. If you are holding publicly traded stocks, bonds, ETFs, and some mutual funds then everything would transfer without incurring taxes. But proprietary mutual funds might not be able to be transferred or might incur significant transaction fees at your new firm. I think I remember Schwab had an ACATS request form that allowed the user to check what would transfer and what would have to be liquidated before the request was actually submitted. Fidelity might have a similar tool, but otherwise that information should be similar between any pair of institutions. https://www.investopedia.com/terms/a/acat.asp

Yes, TreasuryDirect is for I bonds, that interest rate has been too good to ignore. But don't consider it an essential account everyone must have.

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mat_i_x t1_j2ayb07 wrote

Fidelity is solid. No minimum cash balances or restrictions on investments or anything. Some other providers may force you to hold a certain $ or % of the account as cash, so make sure to review the restrictions for whoever you go with.

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Available_Market9123 OP t1_j2b0qi5 wrote

Thanks, maybe fidelity is just the way to go

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Suspicious-Kiwi123 t1_j2bamkn wrote

I used to have everything at Vanguard. Then I needed an HSA and a solo 401k and Fidelity offers both. I switched from Vanguard to Fidelity and they have been great!

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Select-Cost-2237 t1_j2azlok wrote

If we are talking about a Health Savings Account mine was something our Union Hall collectively bargained for about 10 years ago. Every hour we worked we got like 2$ that went into an account along with the other pipefitters in my local and managed by a 3rd party health trust. I don’t believe we were getting interest on our money. That 2$ is now after 10 years of Health Cost skyrocketing is now 50 cents an hour. HSA’s are great to have and not sure of the rules when it comes to making money in a self funded HSA. I do know IRS are Nazi’s about showing exactly what you spent the money or who ever you choose will definitely want receipts. My new job has a before tax FSA which this year the government allows $3050 and we can only roll over $500 to the next year. My opinion is find a reputable company that does do personal HSA’s and you’ll want a company that gives you a Debit card. Purchases are easier to prove that the money was used for things on the IRS’s list of approved healthcare items.

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Canoearoo t1_j2bblj3 wrote

I've had an HSA with Optum for around 15 years +/- and 2 jobs. Vanguard funds are an investment option, along with Fidelity funds and others. I've never had an issue and have had good experiences when I've needed to sort things out. I've contributed via payroll deduction and direct transfer from my credit union account. Hope that helps.

Edit: I have an IRA at Fidelity. My wife has one with another provider and our 401ks are with other providers still. We have joint checking/savings at a credit union, a checking account with a mortgage at a bank and a special needs trust with yet another provider. While I appreciate the idea of a single log in for everything, the main focus for us has always been the financial aspect rather than convenience.

My advice to you would be the same advice I give my son. Find the best solution(s) for the end goal and be organized in dealing with the solutions.

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Either_Survey_6615 t1_j2dukq4 wrote

Another option to consider is Lively. I’ve used them for several years and have had no issues.

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