Opening an HSA tomorrow...

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vaught
Posts: 34
Joined: Fri Aug 11, 2017 2:00 pm

Opening an HSA tomorrow...

Post by vaught » Thu Aug 17, 2017 2:15 pm

I need to open up an HSA and want to get started on it right away. The "plan" would be to utilize it like an extra traditional IRA. Of course having the option to seek medical expense reimbursement makes it all the better. I have an individual health insurance plan for myself that qualifies as HDHP. My wife's policy covers our children and does not currently qualify as HDHP.

So my plan is to go ahead and start an HSA for myself right away and get the benefit of this year's contribution.

Then, in 2018, I will switch my wife's policy to a HDHP so that she can start one in 2018.

Therefore, initial contribution will be $3,400 for myself in 2017 with an additional $3,400 in 2018.
And then a $3,400 contribution to a separate HSA for my wife in 2018.

I want it to be invested in growth index funds with low expense ratios (i.e., Vanguard). I see that Vanguard does not offer them directly through Vanguard but through another entity, HealthSavings Administrators.

Would anyone recommend them or another custodian to utilize that is low ER?

Let me know if I missed anything as I am obviously not familiar with HSAs yet.

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Edie
Posts: 72
Joined: Fri May 06, 2016 4:03 pm

Re: Opening an HSA tomorrow...

Post by Edie » Thu Aug 17, 2017 2:19 pm

One note:
Your wife does not have to open her own HSA next year once she has an HDHP (unless her employer puts money in as a carrot to get their employees to use the HDHP). You can deposit the whole family amount in your account (less any employer contributions (from both employers)). My spouse will only be opening one once they reach 55 for the additional $1000 contribution allowed at that age.

aristotelian
Posts: 3033
Joined: Wed Jan 11, 2017 8:05 pm

Re: Opening an HSA tomorrow...

Post by aristotelian » Thu Aug 17, 2017 2:24 pm

Selectaccount and HSA Authority both offer Vanguard mutual funds for about $30 annually. I believe that is better than Health Savings Administrators.

I was ready to pull the trigger on Selectaccount until I realized that my current HSA set up by my employer through a local credit union offers a 3% 3-month CD with no fees. I decided it was simpler to take that deal and then reduce my bond allocation elsewhere.

stimulacra
Posts: 99
Joined: Wed Dec 21, 2016 3:50 pm
Location: Houston

Re: Opening an HSA tomorrow...

Post by stimulacra » Thu Aug 17, 2017 2:24 pm

I use Health Savings Administrators. It's very easy to assemble a three fund portfolio there (VTSAX, VTIAX, VBTLX).

The annual account administrative fees are a smidge high ($45/year).

Other than that no real complaints. The interface isn't great but I only log in 2-3 times a year. It's easy enough for me to track the performance externally.

vaught
Posts: 34
Joined: Fri Aug 11, 2017 2:00 pm

Re: Opening an HSA tomorrow...

Post by vaught » Thu Aug 17, 2017 2:26 pm

Thanks for both replies.

In case it is relevant, neither my employer or my wife's employer offer HSAs. So obviously no matching either. These would just be set up by us independently.

vaught
Posts: 34
Joined: Fri Aug 11, 2017 2:00 pm

Re: Opening an HSA tomorrow...

Post by vaught » Thu Aug 17, 2017 2:28 pm

stimulacra wrote:
Thu Aug 17, 2017 2:24 pm
I use Health Savings Administrators. It's very easy to assemble a three fund portfolio there (VTSAX, VTIAX, VBTLX).

The annual account administrative fees are a smidge high ($45/year).

Other than that no real complaints. The interface isn't great but I only log in 2-3 times a year. It's easy enough for me to track the performance externally.
I saw the $45 admin fee but they also appear to charge a 6.25 basis point custodial fee per quarter.

stimulacra
Posts: 99
Joined: Wed Dec 21, 2016 3:50 pm
Location: Houston

Re: Opening an HSA tomorrow...

Post by stimulacra » Thu Aug 17, 2017 2:38 pm

Yes, in my instance, the custodial fees aren't noticeable yet. The $45 admin fees eclipse it by a magnitude.

I have a few years to go, just started my HSA in Jan and there's some moderate out of pocket expenses I can use it for this coming fall so I'm debating what to do (pay out of pocket and save the receipt till 2050 or use my HSA debit card).

Helo80
Posts: 436
Joined: Sat Apr 29, 2017 8:47 pm

Re: Opening an HSA tomorrow...

Post by Helo80 » Thu Aug 17, 2017 6:00 pm

vaught wrote:
Thu Aug 17, 2017 2:15 pm

Therefore, initial contribution will be $3,400 for myself in 2017 with an additional $3,400 in 2018.
And then a $3,400 contribution to a separate HSA for my wife in 2018.

Not sure if you have had the same eligible plan all of 2017, or are just starting it now.... August. But, you have to pro-rate the HSA contribution amount if you just got on an eligible HSA HDHP.
http://cdn-aem.optum.com/content/dam/op ... hanges.pdf

It's better to know this now than when you're filing for taxes with the IRS.

pshonore
Posts: 5662
Joined: Sun Jun 28, 2009 2:21 pm

Re: Opening an HSA tomorrow...

Post by pshonore » Thu Aug 17, 2017 6:36 pm

Helo80 wrote:
Thu Aug 17, 2017 6:00 pm
vaught wrote:
Thu Aug 17, 2017 2:15 pm

Therefore, initial contribution will be $3,400 for myself in 2017 with an additional $3,400 in 2018.
And then a $3,400 contribution to a separate HSA for my wife in 2018.

Not sure if you have had the same eligible plan all of 2017, or are just starting it now.... August. But, you have to pro-rate the HSA contribution amount if you just got on an eligible HSA HDHP.
http://cdn-aem.optum.com/content/dam/op ... hanges.pdf

It's better to know this now than when you're filing for taxes with the IRS.
I believe if you're eligible in December, you can contribute for the whole year. However, if you don't remain eligible for the entire following year, you will have to withdraw money and/or face penalties

eagleeyes
Posts: 81
Joined: Sat Dec 28, 2013 2:49 pm

Re: Opening an HSA tomorrow...

Post by eagleeyes » Thu Aug 17, 2017 9:52 pm

I'm a big saturna fan. The enrollment process is a little clunky but the customer service is excellent and helpful. Once you get going it's pretty easy and they have vanguard funds

Spirit Rider
Posts: 6498
Joined: Fri Mar 02, 2007 2:39 pm

Re: Opening an HSA tomorrow...

Post by Spirit Rider » Thu Aug 17, 2017 11:30 pm

Just be aware that if your wife has a general purpose FSA that can be used to reimburse your qualified medical expenses (most can), you are ineligible for HSA contributions.

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