Anyone have an HSA?

[greenmonkey1]

DH and I are now on independent health insurance (not through the marketplace) since he is self-employed and I'm now a SAHM.  Our plan is HSA-compatible.  How do we choose a company to go with for the HSA?  Our financial planner does not offer HSAs and recommended we look at Optum.  My parents use PNC.  I don't know if they all work the same or if one is "better" than another.


Advice?  TIA.  

[covergirl82]

DH and I both have HSAs. His is through Optum, mine is through HealthEquity. I would see if you can find information on differences in the interest rates and tiers that they offer. I know with mine, interest begins accruing when the balance hits $2,000 (and there are tiers of interest rates based on the balance). I can also start investing some of the money at $2,000, but I haven't really researched how that works. (I don't want to invest a portion of the balance and then need it and have to pay a penalty to use it.)

[akafred]

Mine is through my employer, sorry. I love it though!

[186momx]

Mine is through my local credit union where I do my banking. Make sure whatever one you choose doesn't have big bank charges being taken out each month. I switched from HSA Bank to my credit union for this reason. Make .20 cents in interest and $5 bank charge isn't good.

I really enjoy my HSA and have had it for almost 10 years and max it out each year.

[welly01]

I have an HSA at Fidelity and through my current employer at HSA Bank. Use something like Bankrate to come up with a list of the best 5-10 HSA providers. Then look at the fees and options for both. Depending on how you want to use it might change which provider you may prefer. The fee for an HSA at Fidelity is almost twice what it is at HSA Bank but I prefer my Fidelity HSA more because I can invest without trade fees. I don't like the investment options at HSA Bank. I am biased though because all of my retirement accounts are with Fidelity.

I love my HSA because I try to pay out of pocket as much as possible and save the rest for investment. The Fidelity HSA has had really good growth since last year so I'm comfortable paying the fee to keep my money there. The HSA Bank account will just stay in cash to pay for ongoing medical stuff.

If you are eligible for an HSA, I would definitely open one and fund it to the max. You can always use the money for current and future medical expenses and it is the most tax-advantaged retirement account available. If you open an account and find out something you don't like, you can always do a rollover to another account (be careful, this works the same as moving an IRA).

[2chatter]

I didn't open this thread because it stresses me out. But this is another reason I need to run our budget - to see what we actually spend on medical and start using an HSA.

Do all HSAs force you to use all funds annually? If not, that might be a shopping point.

[covergirl82]

2chatter, no, you can continue to accrue a balance (and earn interest and invest your HSA dollars). It's similar to a 401k or 403b in that there are contribution limits each year (depends on if you have a single or family plan), but if you don't spend all your contribution dollars one year, they remain in your account. (It's the Flexible Spending Account (FSA) that is a use-it-or-lose-it plan.)

IMO, HSAs are great if you/your family is/are relatively healthy. I don't think they are great for people with severe or chronic illnesses/conditions that require expensive medicines/treatments and potential multiple hospital stays. Ideally, if people start one when they are young and healthy, it should provide enough funds later in life to cover more frequent and severe medical events.

[2chatter]

covergirl82 - TY the dots just connected! I need to get one this...

[msn06]

Mine is through a local credit bureau. My parents is through their bank.

[welly01]

Does anyone know how it works on your taxes if you contribute after-tax dollars to an HSA? So, currently, I'm able to contribute through my employer so my contributions are pre-tax (federal and social security). But I also have an HSA not connected to my employer. If I just transfer money from my checking account, when I file my taxes, will it still get counted the same way? I know its tax deductible for federal taxes but do they also include the amount you paid in social security taxes? I haven't contributed after-tax dollars because I don't want to lose out on any tax benefits but I'd rather use the HSA not affiliated with my employer.

[186momx]

welly01, pull up a copy of the 8889 (HSA form) on irs.gov (use the search feature their new website sucks).

Employer paid part has a line and then the taxpayer has its own line for contributions paid. If you are paying into your HSA out of your own pocket it is deductible on the front of the 1040. The 8889 is actually a pretty easy form to follow.

[welly01]

Thanks 186momx!

[greenmonkey1]

Thanks for all the suggestions and advice.