New fee schedule at HSA bank

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New fee schedule at HSA bank

Postby indexer » Thu Jul 28, 2011 4:49 pm

I have an HSA account at HSA bank . The $13000 balance is currently in their savings account earning 0.8%. I called them today to link my account to TD ameritrade and I plan on using Vanguard's TBM index fund( to fit in with the rest of my portfolio). I pay all my medical bills out of pocket and am treating this account as an IRA. They informed me their fee schedule is changing Sept 1.
The new fees are..
1. $2.5/month (up from $2.25) for balances less than $3000
2. New $3/month brokerage fee for balances less than $5000

This is in addition to the TD ameritrade fees for transactions. I plan on buying lump sum once a year. I know there is no fees if I set up automatic transfers.

I'm wondering if I should move the money to Alliant Credit Union (with whom I do all my banking) for a fixed 2% interest and no other fees? HSA bank has a $25 fee for closing the account.
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Postby mikep » Thu Jul 28, 2011 4:54 pm

If you leave 3k in the savings account and move 10K to TBM, you won't pay any fees?

How much do you want to invest in TBM vs leave in savings?
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Postby indexer » Thu Jul 28, 2011 6:53 pm

If you leave 3k in the savings account and move 10K to TBM, you won't pay any fees?

How much do you want to invest in TBM vs leave in savings?

Thanks Mike.
Yes, if I leave 3-5K in savings at HSA I won't have to pay the monthly fees. The rest can be invested in TBM.
But I'm trying to keep things simple and have one HSA account.
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Re: New fee schedule at HSA bank

Postby joebruin77 » Thu Jul 28, 2011 7:01 pm

indexer wrote:I have an HSA account at HSA bank . The $13000 balance is currently in their savings account earning 0.8%. I called them today to link my account to TD ameritrade and I plan on using Vanguard's TBM index fund( to fit in with the rest of my portfolio). I pay all my medical bills out of pocket and am treating this account as an IRA. They informed me their fee schedule is changing Sept 1.
The new fees are..
1. $2.5/month (up from $2.25) for balances less than $3000
2. New $3/month brokerage fee for balances less than $5000

This is in addition to the TD ameritrade fees for transactions. I plan on buying lump sum once a year. I know there is no fees if I set up automatic transfers.

I'm wondering if I should move the money to Alliant Credit Union (with whom I do all my banking) for a fixed 2% interest and no other fees? HSA bank has a $25 fee for closing the account.


If you do decide to go the route of a fixed savings account, Adirondack Trust is offering an APY of 3.00%:

http://adirondacktrust.com/en/rates-a-c ... osit-rates

I have had my HSA with them for the past year and have been very happy with them.

Good luck.
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Postby wander » Thu Jul 28, 2011 7:02 pm

If there is an amount in my HSA account, I will transfer it to TD Ameritrade right away.
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Account termination fee

Postby sandstones » Thu Jul 28, 2011 10:19 pm

I use my HSA as an investment account and everything is at Ameritrade.

I currently pay HSA bank $27 a year to do one yearly transfer to Ameritrade, and that's all I use them for. Now that going up to $66/year which is higher than any other HSA's I came across.

I had a bit of an argument with them today about the account termination fee - if they are going to got by by 250%, they should provide an opt-out free of charge. I did get an offer to reduce it slightly, but I think this is a perfect opportunity for a class action law suit.

I will be looking into that next week.
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Re: New fee schedule at HSA bank

Postby K-SawDude » Thu Jul 28, 2011 10:35 pm

indexer wrote:I have an HSA account at HSA bank . The $13000 balance is currently in their savings account earning 0.8%. I called them today to link my account to TD ameritrade and I plan on using Vanguard's TBM index fund( to fit in with the rest of my portfolio). I pay all my medical bills out of pocket and am treating this account as an IRA. They informed me their fee schedule is changing Sept 1.
The new fees are..
1. $2.5/month (up from $2.25) for balances less than $3000
2. New $3/month brokerage fee for balances less than $5000


Wait, so does this mean that, in order to avoid account fees, you'd need a minimum of $3k in savings AND a minimum of $5k total in stocks/bonds/etc.?

This is in addition to the TD ameritrade fees for transactions. I plan on buying lump sum once a year. I know there is no fees if I set up automatic transfers.

How much are the transaction fees typically?
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Postby indexer » Fri Jul 29, 2011 1:18 am

Wait, so does this mean that, in order to avoid account fees, you'd need a minimum of $3k in savings AND a minimum of $5k total in stocks/bonds/etc.?

If I understood it right,
1. If the savings account has more than $3000, they waive just the $2.5 monthly maintenance fee.
2. If the savings account has more than $5000, they waive the $3 monthly brokerage fee as well
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Re: New fee schedule at HSA bank

Postby magellan » Fri Jul 29, 2011 8:33 am

joebruin77 wrote: If you do decide to go the route of a fixed savings account, Adirondack Trust is offering an APY of 3.00%

DW and I each have HSAs at Adirondack and we treat the accounts like IRAs. The 3% rate is high enough that I don't mind just calling it part of our bond allocation and not worrying about other investing options.

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Re: New fee schedule at HSA bank

Postby ftobin » Fri Jul 29, 2011 9:03 am

magellan wrote:
joebruin77 wrote: If you do decide to go the route of a fixed savings account, Adirondack Trust is offering an APY of 3.00%

DW and I each have HSAs at Adirondack and we treat the accounts like IRAs. The 3% rate is high enough that I don't mind just calling it part of our bond allocation and not worrying about other investing options.

I also treat my account at HSA Bank just like an IRA. Their accounts have 0.8% interest at the $5000 fee-avoidance level. However, since I expect my equity market returns to well-exceed 1.5% (roughly the amount in fees I pay on the $5000 each year that I could keep in the account to avoid fees), my best option is going to stay fully stock-invested and simply eat the new fees.

I don't have a lot of faith in a bank's APY to stay stable, so I don't think I'd switch to your approach of using it like a bond allocation. Given the rest of their rates, which are < 1%, I suspect the 3% is just a temporary loss leader to garner assets.
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Re: New fee schedule at HSA bank

Postby joebruin77 » Fri Jul 29, 2011 9:44 am

ftobin wrote:
magellan wrote:
joebruin77 wrote: If you do decide to go the route of a fixed savings account, Adirondack Trust is offering an APY of 3.00%

DW and I each have HSAs at Adirondack and we treat the accounts like IRAs. The 3% rate is high enough that I don't mind just calling it part of our bond allocation and not worrying about other investing options.

I also treat my account at HSA Bank just like an IRA. Their accounts have 0.8% interest at the $5000 fee-avoidance level. However, since I expect my equity market returns to well-exceed 1.5% (roughly the amount in fees I pay on the $5000 each year that I could keep in the account to avoid fees), my best option is going to stay fully stock-invested and simply eat the new fees.

I don't have a lot of faith in a bank's APY to stay stable, so I don't think I'd switch to your approach of using it like a bond allocation. Given the rest of their rates, which are < 1%, I suspect the 3% is just a temporary loss leader to garner assets.


That is definitely a risk of going with a "fixed" savings account, the rate can go down at any time. However, I found Adirondack after the rate at my former bank did just that. It was very easy to move my account from one institution to another. So if the Adirondack rate does go down, I will shop around and move again if I can find a better rate.

I don't yet have the equivalent of several years worth of medical expenses in my HSA account, so I would not be comfortable investing my HSA funds in the stock market. In my opinion, that route is more risky than the possibility of the 3.00% rate going down.
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Re: New fee schedule at HSA bank

Postby ftobin » Fri Jul 29, 2011 10:12 am

joebruin77 wrote:I don't yet have the equivalent of several years worth of medical expenses in my HSA account, so I would not be comfortable investing my HSA funds in the stock market. In my opinion, that route is more risky than the possibility of the 3.00% rate going down.

The only reason I invest in equities with my HSA is that I've calculated that as long as an account for more than 10 years, the savings that come from being in a tax-deferred account are greater than the benefits of using it to pay medical expenses. In other words, in the long run, it's more efficient to pay medical expenses out of pocket and gain tax-deferred investment returns than pay medical expenses with tax-free monies. You have to be assured you won't need to tap the HSA account, though.
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Re: Account termination fee

Postby Lente » Fri Jul 29, 2011 10:20 am

sandstones wrote:I use my HSA as an investment account and everything is at Ameritrade.

I currently pay HSA bank $27 a year to do one yearly transfer to Ameritrade, and that's all I use them for. Now that going up to $66/year which is higher than any other HSA's I came across.

I had a bit of an argument with them today about the account termination fee - if they are going to got by by 250%, they should provide an opt-out free of charge. I did get an offer to reduce it slightly, but I think this is a perfect opportunity for a class action law suit.

I will be looking into that next week.


HSA fees have been a rather...touchy subject for myself as well. It seems to me that banks are taking advantage of the fact that these accounts are lucrative for the individual and attempting to siphon some of that opportunity off for themselves. It's a tricky situation; on one hand I am the consumer and can pull my money to show I am displeased; but then it seems most banks are charging "HSA Fees" these days. Opting out of the HSA entirely seems foolish because even with the fees it's a great deal. And the banks know that. Damn them.

back to your original subject; I agree something seems fishy about their ability to change your contract terms at will, and then charge you if you wish to exit the new contract.
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Re: New fee schedule at HSA bank

Postby magellan » Fri Jul 29, 2011 11:19 am

ftobin wrote:Given the rest of their rates, which are < 1%, I suspect the 3% is just a temporary loss leader to garner assets.

It's certainly possible that the rate is a loss leader and it does seem a bit generous, but they've been offering a competitive rate for a few years now and they know that Internet depositors will flee as fast as they came if rates aren't competitive.

It's also possible that unlike a normal checking or savings account, HSA deposits from Internet customers tend to stay put, as long as the interest rate is competitive. For folks using an HSA as an IRA, the stickiness of their deposits may allow a bank to economically pay a rate closer to that on a longer term CD, since it's so likely that the funds will stay put for a long time.

If I were about to make a switch, I'd look at the second most competitive HSA interest rate and assume Adirondack will offer something below their current rate and above the second best rate for the foreseeable future.

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Re: New fee schedule at HSA bank

Postby ftobin » Fri Jul 29, 2011 12:23 pm

magellan wrote:For folks using an HSA as an IRA, the stickiness of their deposits may allow a bank to economically pay a rate closer to that on a longer term CD, since it's so likely that the funds will stay put for a long time.

Unfortunately for the bank the IRA-style users have incentive to keep little balance with the bank itself, since they keep the funds with the brokerage. When that's the case, the bank's fixed cost overhead per-account can be high relative to the in-bank account balance.

In other cases, there are HSA accounts where you invest directly with mutual funds, but from my searching it looks like most offerings of this nature give funds with high ER's, suggesting kickbacks to the bank (in other words, the bank fees you one way or another).
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Re: New fee schedule at HSA bank

Postby magellan » Fri Jul 29, 2011 12:30 pm

ftobin wrote:
magellan wrote:For folks using an HSA as an IRA, the stickiness of their deposits may allow a bank to economically pay a rate closer to that on a longer term CD, since it's so likely that the funds will stay put for a long time.

Unfortunately for the bank the IRA-style users have incentive to keep little balance with the bank itself, since they keep the funds with the brokerage. When that's the case, the bank's fixed cost overhead per-account can be high relative to the in-bank account balance.

Sorry for the confusion. I was commenting on HSA accounts like Adirondack's where there's only a savings account option. I agree that in the case of joined savings/brokerage accounts, the economics are completely different.

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Re: New fee schedule at HSA bank

Postby joppy » Fri Jul 29, 2011 12:59 pm

magellan wrote:I agree that in the case of joined savings/brokerage accounts, the economics are completely different.
Jim


I don't see the new fee schedule on the HSA bank web site. Assuming this new fee schedule is true, I am somewhat annoyed at the bait and switch. On the other hand, if HSABank just miscalculated the economics, there isn't much to complain about.

Are the economics of HSA accounts too poor for brokerage companies to get into the business directly? The fixed cost of hosting an "investment HSA" as opposed to a "spending HSA" should be similar to that of hosting an IRA. Any thoughts on how much fixed cost there would be on compliance?

Are there too few people who know about using an HSA as compared to an IRA, and can afford to pay medical bills out of pocket?

Is $66 per year really the best deal available? Looking from the other perspective, is there a worthwhile business opportunity to host an investment-only HSA at $33 per year or less?

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Re: New fee schedule at HSA bank

Postby Angst » Fri Jul 29, 2011 1:21 pm

indexer wrote:I have an HSA account at HSA bank . The $13000 balance is currently in their savings account earning 0.8%. I called them today to link my account to TD ameritrade and I plan on using Vanguard's TBM index fund( to fit in with the rest of my portfolio). I pay all my medical bills out of pocket and am treating this account as an IRA. They informed me their fee schedule is changing Sept 1.
The new fees are..
1. $2.5/month (up from $2.25) for balances less than $3000
2. New $3/month brokerage fee for balances less than $5000

This is in addition to the TD ameritrade fees for transactions. I plan on buying lump sum once a year. I know there is no fees if I set up automatic transfers.

I'm wondering if I should move the money to Alliant Credit Union (with whom I do all my banking) for a fixed 2% interest and no other fees? HSA bank has a $25 fee for closing the account.

Perhaps you're unaware that TD Ameritrade has quite a few no-fee ETFs available, including many from Vanguard, including Vanguard's Total Bond Market BND. I pay no transaction fees with my HSA Bank/TD Ameritrade HSA.

Log into TDAmeritrade, go to: Reasearch & Ideas, then to: ETFs, then click in box on right: Commission-Free ETFs.
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Postby Angst » Fri Jul 29, 2011 2:33 pm

I just spoke with someone at HSA Bank about the new fee. Unlike the $2.50 "maintenance" fee which can be pre-paid monthly or annually, with non-HSA funds, the monthly $3.00 "investment" fee can NOT be prepaid, it must come out of your HSA funds. So I asked, If I have a zero balance in my HSA account, and if my TD Ameritrade acct is fully invested, where will they get the cash for my monthly fee? She said they would sell a share of my ETF!

What a pain... so I guess you'll want to simply make sure there's at least a $3.00 balance in your HSA account every month? I'm wondering if HSA Bank is worth the trouble anymore.
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Postby mikep » Fri Jul 29, 2011 2:39 pm

Time for Vanguard to step up and offer HSA's. I was going to use HSA bank after the first of the year as I'll finally have enough to invest, but may look elsewhere now.
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Postby ftobin » Fri Jul 29, 2011 2:44 pm

Angst wrote:What a pain... so I guess you'll want to simply make sure there's at least a $3.00 balance in your HSA account every month? I'm wondering if HSA Bank is worth the trouble anymore.

My solution is to simply keep about $200-$300 dollars in my HSA account, and have the rest invested, to avoid any surprise fees and allow me the ability to forget about it for about 2 years. I presume I'll max my contribution each year, so I refresh up to this level in January.
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Postby Angst » Fri Jul 29, 2011 2:52 pm

ftobin wrote:My solution is to simply keep about $200-$300 dollars in my HSA account, and have the rest invested, to avoid any surprise fees and allow me the ability to forget about it for about 2 years. I presume I'll max my contribution each year, so I refresh up to this level in January.

I understand your rationale, although I'd stop at $66 and try to keep my ETF account fully invested. My problem though is that as of next January, I will take advantage of my new employer's healthcare plan which is an extremely good, inexpensive plan. It's a no-brainer financially but I hate to lose out on future HSA contributions (it's not HSA qualified). I have about $20,000 now in my HSA so I'll still keep it, but where? This fee mess at HSA bank makes me open to new suggestions.
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alternatives to HSABank

Postby joppy » Sun Jul 31, 2011 1:40 am

I just confirmed the HSABank Fee hikes.

Looking at the Bogleheads Wiki entry Health Savings Account, HSABank, at $66 / year + $9 per year for paper statements, is no longer the cheapest HSA brokerage option.

The cheapest option now appears to be the Stirling HSA. If you choose the Stirling eSavings Plan and add an outside dual-titled brokerage account, the total fees are $2.50/month + $16/year brokerage fee = $46 per year. I don't see any option to get paper statements. I also don't see how much it costs if anything to transfer funds from my employer HSA into the Stirling HSA. Perhaps it is possible to transfer funds directly into the brokerage account.

The Wiki should be updated to reflect this information.

Cheers,
Joppy
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Postby LH » Sun Jul 31, 2011 7:16 am

https://hsaadministrators.info/vanguard-funds-list

You can put your HSA into vanguard funds at HSA administrators.

Vanguard links to them from their site.

https://personal.vanguard.com/us/whatwe ... lthsavings

My HSA is part of my AA. I have it all in TBM currently.
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Postby lambdapro » Sun Jul 31, 2011 8:21 am

HSAAdministrators is pretty expensive if you go into four funds and fully funded at $20,000 per fund. Besides the $36 per year, there is then a charge of 8 basis points per quarter, which would max out at $256 per year. Right now we only have $2500 per fund for mid cap, small cap, international and total bonds, but I will be changing next year.
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Postby indexer » Mon Sep 12, 2011 5:22 pm

I just confirmed the HSABank Fee hikes.

Looking at the Bogleheads Wiki entry Health Savings Account, HSABank, at $66 / year + $9 per year for paper statements, is no longer the cheapest HSA brokerage option.

The cheapest option now appears to be the Stirling HSA. If you choose the Stirling eSavings Plan and add an outside dual-titled brokerage account, the total fees are $2.50/month + $16/year brokerage fee = $46 per year. I don't see any option to get paper statements. I also don't see how much it costs if anything to transfer funds from my employer HSA into the Stirling HSA. Perhaps it is possible to transfer funds directly into the brokerage account.

The Wiki should be updated to reflect this information.

Cheers,
Joppy

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Re: New fee schedule at HSA bank

Postby floydtime » Fri Oct 28, 2011 12:45 pm

The Wiki is a bit out of date on HSA fees (not surprising since they are a moving target! :/ ).

HSABank finally updated the fee schedule online: http://www.hsabank.com/hsabank/Accounth ... _Fees.aspx (crap, that's a lot of fees!).

It seems to me that the best option currently, for those with significantly over $5k in their HSA, is to hold your nose and go with HSA Bank...
-Keep $5000 in the core savings at a measley ~0.6% currently.
-Opt out of paper statements.
-Put everything else in the linked Ameritrade and invest for free in ETFs (held over 30 days), or Vanguard funds (if automatic transfers set up).

Oh, and never close the account to avoid their account closing fee. :roll:
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Re: New fee schedule at HSA bank

Postby archbish99 » Fri Oct 28, 2011 3:08 pm

And for those of us who are also paying expenses out of the HSA, it seems like we'd need enough that we still end the year at $5,000 too. Yuck. My hope was to keep our out-of-pocket maximum in cash and invest the excess. This sounds like I should keep the OOP max plus $5,000, or at least close enough to $5,000 that it would take an unlikely medical disaster to get below the $5k mark.

Guess it'll be a while before we're ready to start that process.... We'll need at least two years of HSA savings before we have that much excess.
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Re: New fee schedule at HSA bank

Postby tarnation » Sat Oct 29, 2011 5:51 pm

archbish99 wrote:And for those of us who are also paying expenses out of the HSA, it seems like we'd need enough that we still end the year at $5,000 too. Yuck. My hope was to keep our out-of-pocket maximum in cash and invest the excess. This sounds like I should keep the OOP max plus $5,000, or at least close enough to $5,000 that it would take an unlikely medical disaster to get below the $5k mark.

Guess it'll be a while before we're ready to start that process.... We'll need at least two years of HSA savings before we have that much excess.

It seems to me most folks who are paying expenses out as they go, don't use investment options. You only need $2K minimum balance to avoid fees.
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Re: New fee schedule at HSA bank

Postby archbish99 » Sat Oct 29, 2011 10:49 pm

Well, I admittedly have a slight advantage in that the max contribution per year is $1,250 greater than my HDHP's max out-of-pocket for the year. If we max out the account, I'm guaranteed to accrue at least $1,250/year that we won't need for immediate expenses. That $1,250 is investible, in my eyes. I'm sure many people who are paying out expenses either aren't maxing out the account, or have a max out-of-pocket which equals or exceeds the max annual contribution, which makes me a little bit rare.

However, until I reach the point where I have enough to be able to invest without significant fees, there's no point moving the HSA money from the bank my employer sponsors with its horrendous selection of high-cost, actively-managed funds.
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Re: New fee schedule at HSA bank

Postby feedMe » Tue Nov 01, 2011 5:09 pm

We're in the process of moving our HSA accounts from HSA Bank after being happy with them for over 3 years. But the latest fee increases as mentioned here were too much for us to stay.

We're moving to Bank of Cashton. Unless (until?) they raise their fees, they charge only a $25 yearly fee as long as you maintain at least a $100 balance. There is no additional fee for keeping the bulk of your HSA in the linked brokerage account with BrokersXpress (related to OptionsXpress, but with slightly different terms). BrokersXpress charges a somewhat high $14.95/trade, including mutual funds. But we don't trade very often, so that shouldn't be much of a problem (besides, I think that's what we were paying at TDA).

The transfer process hasn't been easy. First, we had to liquidate all positions in TDA, wait until they cleared, wait another day until HSA Bank's system showed the same, cleared amount, and then request the transfer. Online the transfer was limited to $10K/day, but if you call they can transfer the entire amount (but it takes several days longer, for some reason). Finally we were able to have the Bank of Cashton fax the transfer request to HSA Bank. We then waited and waited and waited (our fault). HSA Bank says they never got the fax. So, Cashton faxed it again. And again. Finally, on the 4th fax attempt, after 2 weeks, and getting someone at HSA Bank to physically wait for the fax, it was received and will be processed tomorrow.

But it's not over yet. Now there is a mandatory 5 business day holding period! Even a very helpful HSA Bank supervisor wasn't able to waive the waiting period. After that, it will be snail mailed to Bank of Cashton, taking another 2-3 days.

The Bank of Cashton has been very helpful and patient with this process, so that bodes well for them. I'd recommend looking into them if you're considering a switch, though obviously our dealings with them have been fairly limited so far.
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Re: New fee schedule at HSA bank

Postby mshiznitzh » Tue Nov 01, 2011 7:07 pm

Anyone using Wells Fargo? https://www.wellsfargo.com/investing/hsa/

What fees apply to a Wells Fargo HSA?
There is a monthly service fee of $4.25 per month, unless otherwise indicated by your employer or insurance carrier. Additional banking fees may apply if you choose to use optional banking services or choose other non-standard services. The monthly service fee will be waived if the combined deposit and investment balance in your HSA on the last day of the month is greater than or equal to $5,000.

Are there any front-end load fees or transaction fees associated with investments?
The front-end load fees are waived for HSA accountholders. In addition, there are no transaction fees.

Here is a list of there investment choices
    Wells Fargo Advantage Government Money Market Fund (A) WFGXX

    Wells Fargo Advantage Cash Investment Money Market (S) NWIXX

    Wells Fargo Advantage Total Return Bond Fund (Admin) MNTRX

    Wells Fargo Advantage Diversified Equity (Admin) NVDEX

    Wells Fargo Advantage Conservative Allocation ( Admin) NVCBX

    Wells Fargo Advantage Moderate Balanced (Admin) NVMBX

    Wells Fargo Advantage Growth Balanced (Admin) NVGBX

    Wells Fargo Advantage Dow Jones Target Today Fund (Admin) WFLOX

    Wells Fargo Advantage Dow Jones Target 2010 Fund (Admin) WFLGX

    Wells Fargo Advantage Dow Jones Target 2020 Fund (Admin) WFLPX

    Wells Fargo Advantage Dow Jones Target 2030 Fund (Admin) WFLIX

    Wells Fargo Advantage Dow Jones Target 2040 Fund (Admin) WFLWX

    Wells Fargo Advantage Dow Jones Target 2050 Fund (Admin) WFQDX


I think I may make the move at the 1st of next year.
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Re: New fee schedule at HSA bank

Postby tarnation » Tue Nov 01, 2011 7:13 pm

feedMe wrote:We're in the process of moving our HSA accounts from HSA Bank after being happy with them for over 3 years. But the latest fee increases as mentioned here were too much for us to stay.

We're moving to Bank of Cashton. Unless (until?) they raise their fees, they charge only a $25 yearly fee as long as you maintain at least a $100 balance. There is no additional fee for keeping the bulk of your HSA in the linked brokerage account with BrokersXpress (related to OptionsXpress, but with slightly different terms). BrokersXpress charges a somewhat high $14.95/trade, including mutual funds. But we don't trade very often, so that shouldn't be much of a problem (besides, I think that's what we were paying at TDA).

The transfer process hasn't been easy. First, we had to liquidate all positions in TDA, wait until they cleared, wait another day until HSA Bank's system showed the same, cleared amount, and then request the transfer. Online the transfer was limited to $10K/day, but if you call they can transfer the entire amount (but it takes several days longer, for some reason). Finally we were able to have the Bank of Cashton fax the transfer request to HSA Bank. We then waited and waited and waited (our fault). HSA Bank says they never got the fax. So, Cashton faxed it again. And again. Finally, on the 4th fax attempt, after 2 weeks, and getting someone at HSA Bank to physically wait for the fax, it was received and will be processed tomorrow.

But it's not over yet. Now there is a mandatory 5 business day holding period! Even a very helpful HSA Bank supervisor wasn't able to waive the waiting period. After that, it will be snail mailed to Bank of Cashton, taking another 2-3 days.

The Bank of Cashton has been very helpful and patient with this process, so that bodes well for them. I'd recommend looking into them if you're considering a switch, though obviously our dealings with them have been fairly limited so far.

you shouldn't be paying anything for trades at TDAM. They have 100 ETF's that are free, including many VG funds. i would rather have the option for keep some cash and paying no fee at HSABank, rather than lock in a $25yearly fee.
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Re: New fee schedule at HSA bank

Postby LH » Tue Nov 01, 2011 8:01 pm

https://hsaadministrators.info/vanguard-funds-list

I use the one off the vanguard site, that offers vanguard funds. Unsure if its fees are lower. Its called HSA as well, but is a different website.
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Re: New fee schedule at HSA bank

Postby billern » Tue Nov 01, 2011 8:19 pm

LH wrote:https://hsaadministrators.info/vanguard-funds-list

I use the one off the vanguard site, that offers vanguard funds. Unsure if its fees are lower. Its called HSA as well, but is a different website.
That is HSA administrators and the original thread is about HSA bank. HSA administrators charges some percentage based fees based upon the amount of money invested with them vs. HSA bank which has fixed fees which are waived if you maintain a high cash balance.

For people with fairly significant investment balances, HSA bank's fees can work out better than HSA adminstrators. Do the math yourself regarding the fees you pay for your HSA account to figure out what is better for you.
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Re: New fee schedule at HSA bank

Postby feedMe » Tue Nov 01, 2011 8:19 pm

LH wrote:https://hsaadministrators.info/vanguard-funds-list

I use the one off the vanguard site, that offers vanguard funds. Unsure if its fees are lower.

You can be sure -- they aren't. It would cost $103 per year for each of our accounts, which makes HSA Bank's fees look a lot more attractive. :D
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Re: New fee schedule at HSA bank

Postby MoneyOCD » Thu Nov 03, 2011 9:50 am

I still can not believe that options for HSA accounts are so limited.
Looks like more and more people move to HDHP+HSA insurance.
Many companies are really forcing those plans on their employees.
My company for example has been offering HDHP+HSA for 6 years and each year they tried to educate people and make it more attractive by offering deposits into HSA and very low rates compare to PPO and HMO. For 2012 they cut out HMO, so only HDHP+HSA and PPO are available and announce that in 2013 we will have only one option for health insurance: HDHP +HSA. That will be huge amount of HSA accounts as company has about 50k employees. I suspect that our company is not alone in that movement.

Should we expect better offerings for HSAs with such growth of accounts?
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Re: New fee schedule at HSA bank

Postby ftobin » Thu Nov 03, 2011 10:30 am

MoneyOCD wrote:Should we expect better offerings for HSAs with such growth of accounts?

I suspect most people get their HSA through their employer, not through individual selection. Given the historic record of 401k choices by employers, I don't expect significant value to be added by growth inside of employer plans. Once it's more common for people to establish the HSA account on their own I'll expect competition to start providing more valued service.
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Re: New fee schedule at HSA bank

Postby feedMe » Thu Nov 03, 2011 10:44 am

I'm with MoneyOCD; I sure thought by now that there would be more choices than there are.

What do people do with employer-sponsored HSAs when they change (or lose) jobs? Especially if the new situation doesn't offer an HSA?

Based on my experience trying to move our HSAs, it isn't nearly as quick, easy, or painless as an IRA rollover. Hopefully with more and more people signing up for HSAs through their employers, that will eventually increase the number of people needing to find HSA accounts themselves. That increased demand would then lead to increased choices. It's a nice theory anyway.
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Re: New fee schedule at HSA bank

Postby MoneyOCD » Thu Nov 03, 2011 11:02 am

ftobin wrote:
MoneyOCD wrote:Should we expect better offerings for HSAs with such growth of accounts?

I suspect most people get their HSA through their employer, not through individual selection. Given the historic record of 401k choices by employers, I don't expect significant value to be added by growth inside of employer plans. Once it's more common for people to establish the HSA account on their own I'll expect competition to start providing more valued service.


Difference between HSA and 401k is huge: you can not move money out of 401k while still employed but can do that for HSA.


feedMe wrote:Based on my experience trying to move our HSAs, it isn't nearly as quick, easy, or painless as an IRA rollover


There are 2 ways to move out to your own HSA:
1. Trustee to trustee transfer: you fill the form and you current HSA company will send money directly to your new HSA company.
Usually very slow process, also many companies charge fees for transfer out. You can do that as often as you want - no limits but sure painful.
2. Rollover: you wright a check from your current HSA account and deposit onto your new HSA account. Very simple, very fast, no fees.
Current company will report it to IRS as distribution, you will list it on line 14a form 8889 and then you need to put rollover amount (which is the same) on line 14b of the form - also very simple and no tax implications. Only drawback is that you can do rollover only once per year (per IRS).

I used both methods; second one is the best, moving money every January to my own HSA with no issues.
Last edited by MoneyOCD on Thu Nov 03, 2011 11:58 am, edited 1 time in total.
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Re: New fee schedule at HSA bank

Postby feedMe » Thu Nov 03, 2011 11:53 am

Thanks, MoneyOCD. I had no idea that there was such a thing as an HSA rollover; that's good to know. (Though we don't typically request checks or a debit card for our HSA accounts, so we'd have to have gotten that first.) I assume account closing fees would still apply, though. (But being able to fund the new HSA account weeks faster is a definite plus.)
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Re: New fee schedule at HSA bank

Postby archbish99 » Thu Nov 03, 2011 12:55 pm

I think what MoneyOCD is proposing the same thing I intend in the future. Not closing the account, but moving funds from an employer-sponsored account (no fees, but poor investment options) to somewhere with better investment choices. Particularly makes sense if your employer allows a lump-sum investment out of your first paycheck.

This also need not be a paper check -- a bank transfer should work the same.
I'm not a financial advisor, I just play one on the Internet.
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Re: New fee schedule at HSA bank

Postby MoneyOCD » Thu Nov 03, 2011 2:30 pm

archbish99 wrote:I think what MoneyOCD is proposing the same thing I intend in the future. Not closing the account, but moving funds from an employer-sponsored account (no fees, but poor investment options) to somewhere with better investment choices. Particularly makes sense if your employer allows a lump-sum investment out of your first paycheck.

This also need not be a paper check -- a bank transfer should work the same.


That is exactly what I am proposing :P to keep employer sponsored HSA open and transfer money out once per year.
I am not sure about bank transfer, that may result in trustee to trustee transfer with all fees and timelines.
On other hand if you can initiate direct EFT - that may work as distribution too. But you need to make sure that receiving bank knows that incoming funds are not contributions but rollover. That actually will make sense to initiate EFT from receiving bank.
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Re: New fee schedule at HSA bank

Postby superman9379 » Sat Jan 21, 2012 11:41 am

Anyone find any new HSA custodian that they recommend? I am just starting to consider using my HSA as a retirement vehicle this year vs paying expenses from it. I would ultimately like to invest in Vanguard funds if possible. Since I am just starting out, would kit be best to use something like Alliant Credit Union until I build up enough to invest?
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Re: Rolling over money from an HSA account ...

Postby porcupine » Thu Nov 22, 2012 10:30 am

MoneyOCD wrote:
ftobin wrote:
MoneyOCD wrote:Should we expect better offerings for HSAs with such growth of accounts?

I suspect most people get their HSA through their employer, not through individual selection. Given the historic record of 401k choices by employers, I don't expect significant value to be added by growth inside of employer plans. Once it's more common for people to establish the HSA account on their own I'll expect competition to start providing more valued service.


Difference between HSA and 401k is huge: you can not move money out of 401k while still employed but can do that for HSA.


feedMe wrote:Based on my experience trying to move our HSAs, it isn't nearly as quick, easy, or painless as an IRA rollover


There are 2 ways to move out to your own HSA:
1. Trustee to trustee transfer: you fill the form and you current HSA company will send money directly to your new HSA company.
Usually very slow process, also many companies charge fees for transfer out. You can do that as often as you want - no limits but sure painful.
2. Rollover: you wright a check from your current HSA account and deposit onto your new HSA account. Very simple, very fast, no fees.
Current company will report it to IRS as distribution, you will list it on line 14a form 8889 and then you need to put rollover amount (which is the same) on line 14b of the form - also very simple and no tax implications. Only drawback is that you can do rollover only once per year (per IRS).

I used both methods; second one is the best, moving money every January to my own HSA with no issues.

How does the once a year rollover rule work? Is it once a calendar year, i.e., can you do so on 6/6/2012 followed by 1/1/2013, or is it exactly 365 (or 366) days, i.e., if you do it on 1/1/2013, you cannot do it again before 1/2/2013?

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Re: New fee schedule at HSA bank

Postby almeida » Thu Nov 22, 2012 3:36 pm

MoneyOCD wrote:Difference between HSA and 401k is huge: you can not move money out of 401k while still employed but can do that for HSA.


That's not totally true: the IRS permits in-service rollovers for everyone, but it seems many (most?) employers only allow it for people over 59.5.
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Re: New fee schedule at HSA bank

Postby Default User BR » Fri Nov 23, 2012 1:58 am

almeida wrote:That's not totally true: the IRS permits in-service rollovers for everyone, but it seems many (most?) employers only allow it for people over 59.5.

That's not accurate. Employee elective deferrals and designated Roth contributions can't be distributed from a qualified plan before 59-1/2 without a qualifying event, such as separation from service, dissolution of the plan, or approved hardship. The last of those is not eligible for rollover into an IRA.

Other contributions, such as employee after-tax non-Roth or employer contributions can and are sometimes allowed to be distributed in-service.


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Re: New fee schedule at HSA bank

Postby almeida » Fri Nov 23, 2012 4:51 am

Default User BR wrote:That's not accurate. Employee elective deferrals and designated Roth contributions can't be distributed from a qualified plan before 59-1/2 without a qualifying event, such as separation from service, dissolution of the plan, or approved hardship. The last of those is not eligible for rollover into an IRA.

Other contributions, such as employee after-tax non-Roth or employer contributions can and are sometimes allowed to be distributed in-service.


There are a lot of references out there to penalty-free, in-service rollovers for people under 59.5. Many mention new rules as part of TIPRA. However, I can't find anything definitive, so maybe it's all hooey, or maybe there are complex rules glossed over by these websites. Here's one such article: http://southcoastinvest.com/newsroom/ho ... ou-retire/
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Re: New fee schedule at HSA bank

Postby Default User BR » Fri Nov 23, 2012 1:35 pm

almeida wrote:There are a lot of references out there to penalty-free, in-service rollovers for people under 59.5. Many mention new rules as part of TIPRA. However, I can't find anything definitive, so maybe it's all hooey, or maybe there are complex rules glossed over by these websites. Here's one such article: http://southcoastinvest.com/newsroom/ho ... ou-retire/

Did you miss this part of the article?
Some restrictions may apply to 401(k) in-service withdrawals. Generally, 401(k) in-service withdrawals are only available to participants who have reached age 59 ½.


Here are the IRS guidelines on the subject:
Generally, distributions of elective deferrals cannot be made until one of the following occurs:

You die, become disabled, or otherwise have a severance from employment.
The plan terminates and no successor defined contribution plan is established or maintained by the employer.
You reach age 59½ or incur a financial hardship.

http://www.irs.gov/Retirement-Plans/Plan-Participant,-Employee/401%28k%29-Resource-Guide---Plan-Participants---General-Distribution-Rules

Elsewhere in the IRS pubs they mention that the distribution rules for designated Roth contributions follow those of elective deferrals. As noted, other types of contributions are available for in-service distribution at the plan's discretion.


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Re: New fee schedule at HSA bank

Postby almeida » Fri Nov 23, 2012 5:13 pm

Default User BR wrote:Did you miss this part of the article?
Some restrictions may apply to 401(k) in-service withdrawals. Generally, 401(k) in-service withdrawals are only available to participants who have reached age 59 ½.


No, I didn't miss that. "Generally" leaves a lot of wiggle room. There are lots of references in the IRS texts saying that distributions are taxable unless rolled over into a qualifying plan. I don't see an "unless you're under 59.5" appended to those statements anywhere. I admit I may be wrong, but nothing you've posted proves it.
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