Tips for closing out BenefitWallet HSA via direct rollover to new HSA

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hoppy08520
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Tips for closing out BenefitWallet HSA via direct rollover to new HSA

Post by hoppy08520 » Sat Feb 17, 2018 2:31 pm

After my employer switched from BenefitWallet HSA to HSA Bank, I transferred from BenefitWallet to HSA Bank. It was a bit of a pain, and it was difficult to get any knowledgable and consistent guidance from BenefitWallet, so I thought I would outline the steps if anyone else wants to do this. From end to end, this took around a month to complete.

Rollover or Trustee-to-Trustee Transfer?

First, you'll need to decide if you want to do a direct rollover or a trustee-to-trustee transfer. The latter is probably easier and less mistake-prone, but you'll pay a $25 fee to BenefitWallet (as of 1/1/2018). In hindsight, I almost wish I had done the transfer. All the hassle and phone calls and research I did to save $25 was not worth it. A direct rollover has no fee, but you'll do more of the work yourself and you'll also need to fill out an extra form when you file your taxes. Also, you can do at most one rollover per 12 month period. See this Finance Buff blog post for more: How To Rollover an HSA On Your Own and Avoid Trustee Transfer Fee.

Suppose you want to save $25 and do the rollover. Here are the steps.

Preparation

Step 0 - make sure that you have your HSA checkbook. You might have gotten one when your account was opened. You'll need to write a check to the new HSA to rollover your money. If you don't have a checkbook, you can order one from BenefitWallet for around $5 or $10, or you can talk to them on the phone and convince them to send you one for free in order to close your account (which is what I did). See below for phone number.

Step 1 - ensure that you have no outstanding reimbursements processing through your BW HSA, so that your balance will be stable and not a moving target.

Transfer from Investment Account to Savings

In BW, transfer all of your investment balance into your HSA savings account. When I did this, I had a fairly high balance in my investment account, and it was 100% in stocks, so if I moved all this to the savings account which is essentially cash, that would throw off my overall portfolio asset allocation. So, on the same day that I transferred my HSA funds from the investment account to the savings account, I did an opposite transaction in my IRA, exchanging shares in a bond fund to a stock fund, so that my overall portfolio AA would not change.

The BW "investment platform" [sic] is very opaque and does not give you accurate and up-to-date information. Before I did my big transfer, I did a couple of smaller practice transfers (around $100) just to see how long it takes for a transaction to settle. I did this because I wanted to make sure that my offsetting IRA exchange would happen on the same day as the BW trade. In the end, it was hard to tell, but I am pretty sure the BW trade will happen on the same actual day you make it (as long as you do the trade early in the day -- I would do it before 3 PM ET).

It was harder than you might expect to simply transfer the funds from the BW investment platform to the savings account. I often got confusing error messages telling me that I am only allowed to transfer a certain amount, but when I try to transfer that amount, it tells me I am not allowed to do that. Quite frustrating. Eventually I managed to transfer everything into the savings, although it took several days for the online balances to actually show correct amounts.

Once I had all my money in the savings account, I waited for the end of the month when BW pays you some paltry interest. I did this because I didn't want to transfer all my money and then get a $3.00 interest payment.

Execute the Rollover

Then, I filled out my new HSA Bank "HSA rollover form" (not the separate "transfer" form) and wrote out a check from my BW HSA account, in the amount of my total BW HSA balance, payable to "My New HSA" (fill in whatever your new HSA is called). In the check's memo line, I wrote the account number of my new HSA account and also "60 day rollover" (this was advice from HSA Bank), and on the back, under the endorsement line, I wrote "Deposit only to XXXXXXXX" where "XXXXXXX" was the account number of my new HSA. I photocopied the check and the form. Then I mailed the form and check to the new HSA. I just mailed it regular postal mail but maybe I should have done it certified mail.

Presumably, your new HSA has some sort of "Rollover" form. Make sure you tell them you are doing a 60-day rollover and NOT an ordinary contribution --- this will keep your HSA money in its tax-protected status.

A few days later, I saw that in my new HSA, the check had posted because my balance went up. It took several days more to see the balance go to zero in my BenefitWallet HSA; I logged into BW each day to see when the balance went to $0.

Soon after, I invested the money in my new HSA and made offsetting exchanges in my IRA to get my overall portfolio AA where I wanted it to be.

Close the BenefitWallet Account

Finally, I called BenefitWallet to formally close my account. I believe you can do this only over the phone. Call 1-877-472-4200. There are no touch-tone prompts to get to an operator or to close your account. Just ignore the prompts; they will cycle through a couple of times and then it will transfer you to an operator. You'll need to tell them "I want to close my account" and they will take you through the process and then you'll finally be done.

Don't just ignore and walk away from your BW Account. If you don't formally close the account, you might get a low-balance charge and it could be a pain to deal with all that. Just call them up and close your account.

Tax Form 8889

As described in the Finance Buff post, you'll need to include a Form 8889 in your tax return. For me, this will be next year (2018) so I can worry about that a year from now...

More Tips

In trying to figure all this out, I had to talk to BW several times on the phone. It was challenging. They are polite but nobody there seems to understand anything, you get different answers from different people to the same questions, they don't understand why you want to do a rollover (they keep trying to get you to do a transfer instead). I hope I never have to deal with BW again.

Also, don't expect to find any helpful information on this anywhere on BW's website. They obviously want to make it as difficult as possible to leave them.

I tried and tried to get BW to simply write a check payable to me, in the amount of my balance, but they wouldn't do it. They said it was because my balance was too high (around $35,000) and it was some sort of security precaution. I think this is why they mailed me a checkbook for free. So if you ask BW to write you a check to close out your account, you might not be able to do this. [I wanted them to write me a check so that I could deposit it into my own personal checking account, and then write a check to my new HSA from my checking account.]

Recommendation

Unless you are really motivated to save $25, I would not do the direct rollover. I would have done the trustee-to-trustee transfer if I had to do it again.

That being said, now that I know how this works, if I have to do this again, I will probably do a rollover if I have to move HSA custodians again.

cas
Posts: 649
Joined: Wed Apr 26, 2017 8:41 am

Re: Tips for closing out BenefitWallet HSA via direct rollover to new HSA

Post by cas » Thu Jan 10, 2019 6:37 am

hoppy08520 wrote:
Sat Feb 17, 2018 2:31 pm
It was harder than you might expect to simply transfer the funds from the BW investment platform to the savings account. I often got confusing error messages telling me that I am only allowed to transfer a certain amount, but when I try to transfer that amount, it tells me I am not allowed to do that. Quite frustrating. Eventually I managed to transfer everything into the savings, although it took several days for the online balances to actually show correct amounts.
Hoppy - Do you remember how you eventually coerced the SaveDaily platform to transfer 100% of your balance to the deposit account on the BenefitWallet side?

I'm attempting to liquidate and transfer my SaveDaily investments, in preparation for a trustee-to-trustee transfer from BenefitWallet to a Fidelity HSA. I'm at the point of getting the confusing error messages.

First (when trying it via "Redeem") it says
If you attempt to transfer 90% or more, but less than 100% of your available value in that position, your request will be rejected and you will be instructed to either reduce your transfer to 90% or below or to increase your transfer to 100% of the available value. Pending transactions must be considered when applying this calculation.
Then, if I do enter 100% of the value of the position, it spits out a message that says "You have entered $X, which is 100% of your available balance" and refuses to go any further.

I've tried:
- going through a couple of rounds of redeeming 90%, just to haul the majority of funds out of there before trying to deal with customer service.
- different browsers, just in case one of them isn't showing a necessary pop-up or something.
- "Transfer" (as opposed to "Redeem") all the assets into a single fund (still on the SaveDaily Platform - thinking that maybe if I put the last assets in the money market fund it would be happier about redeeming that last little bit), but it imposes the 90% and 100% restriction on the transfer as well.

I'm pondering going with the flow of the lousy computer programming and continuing redemptions of 90%, just to see how far it will let me go. $0.01 in each of my 3 funds? (At least I wouldn't be out too much if I never got the remaining $0.03, although the principle of the thing annoys me.)

I started a thread on the Boglehead's forum, asking for advice, but no advice received so far (just other people who want to know the secret to extracting oneself from SaveDaily): viewtopic.php?f=10&t=269173

Any advice?

beebog
Posts: 34
Joined: Sun Aug 27, 2017 9:51 am

Re: Tips for closing out BenefitWallet HSA via direct rollover to new HSA

Post by beebog » Thu Jan 10, 2019 9:32 am

cas wrote:
Thu Jan 10, 2019 6:37 am
Hoppy - Do you remember how you eventually coerced the SaveDaily platform to transfer 100% of your balance to the deposit account on the BenefitWallet side?

I'm attempting to liquidate and transfer my SaveDaily investments, in preparation for a trustee-to-trustee transfer from BenefitWallet to a Fidelity HSA. I'm at the point of getting the confusing error messages.
I successfully closed out my SaveDaily recently. First I exchanged all my funds into the Fidelity Money Market on the SaveDaily side. I forget the ticker and no longer have access to SaveDaily, sorry. I did this the day after dividends posted on my bond fund so I wouldn't have extra money popping up. When I went to move everything back to the HSA side, I called SaveDaily first and the person on the phone told me to wait because the maintenance fee was in progress for the month and because of that the interface would limit me to only be able transfer 90%. I waited until the day after I saw the $2.90 deduction post and there was nothing pending in the transactions, then I attempted to move everything. I think I used Redeem, but I'm not 100% sure. I'd recommend looking through the transaction history, pending, etc to see what is actually going on in your account. The interface is confusing, but poke around - there are options to look just at messages about transactions and the actual transactions. I had a hard time actually seeing the transactions at first. I'm sorry I can't explain it well because I no longer have access so I don't remember exactly what the links were called. And keep in mind every fee, share exchange, redemption, etc is SLOW. Days passed between each step. I'm used to Fidelity where all my fund purchase and sales occur overnight.

Everything transferred though and my investment account is now zero. Now I'm starting the BenefitWallet to Fidelity transfer, and I am hoping that goes smoothly.

cas
Posts: 649
Joined: Wed Apr 26, 2017 8:41 am

Re: Tips for closing out BenefitWallet HSA via direct rollover to new HSA

Post by cas » Thu Jan 10, 2019 10:24 am

beebog wrote:
Thu Jan 10, 2019 9:32 am
When I went to move everything back to the HSA side, I called SaveDaily first and the person on the phone told me to wait because the maintenance fee was in progress for the month and because of that the interface would limit me to only be able transfer 90%. I waited until the day after I saw the $2.90 deduction post and there was nothing pending in the transactions, then I attempted to move everything.
Ah ... now there's a thought. The most recent $2.90 fee posted with a date of 1/5/2019 (which was a Saturday, which is somewhat suspicious), but has a status of "Completed**". Meanwhile, the fee that posted in December 2018 has a status of "Completed". I wonder if those two asterisks are the holdup. (I searched for "**" on various pages, but couldn't find any footnote explaining them.)

That somewhat fits in with hoppy08520's comment* that (s)he proceeded with multiple days of transferring 90% until one day the system suddenly was willing to take 100%.

SaveDaily doesn't update balances (with yesterday's closing prices) until noon eastern time. (Apparently they are located in California. Someone has to arrive at work at 9am pacific time and manually force the update?) I'll check again a little after noon and see if the two extra asterisks have gone away.

*hoppy08520's helpful comment is on the related thread "BenefitWallet HSA - anyone successfully liquidated 100% of investments at SaveDaily?" viewtopic.php?p=4311689#p4311689)

cas
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Joined: Wed Apr 26, 2017 8:41 am

Re: Tips for closing out BenefitWallet HSA via direct rollover to new HSA

Post by cas » Mon Jan 14, 2019 12:06 pm

hoppy08520 wrote:
Sat Feb 17, 2018 2:31 pm
Step 0 - make sure that you have your HSA checkbook. You might have gotten one when your account was opened. You'll need to write a check to the new HSA to rollover your money.
Hoppy -

Do you remember why you used a check rather than requested an ACH withdrawal into your linked checking account (then wrote a check to HSA Bank from there)? (If you had a linked checking account...)

Maybe you discovered that there was an unadvertised limit on the amount you could withdraw via ACH in any one day?

(I'm researching my options for extracting my money from BenefitWallet, if I were to decide do a 60-day-rollover, and am currently staring suspiciously at the BenefitWallet web page for requesting an ACH withdrawal to my linked checking account. In theory it looks like I could enter my entire balance, but it is entirely possible they might spring a daily limit on me at some late stage of the process. Poked around the "Help" area of the website, but it doesn't look like it has anything useful, like telling me if there is a limit on daily withdrawals via ACH.)

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hoppy08520
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Re: Tips for closing out BenefitWallet HSA via direct rollover to new HSA

Post by hoppy08520 » Mon Jan 14, 2019 12:39 pm

cas wrote:
Mon Jan 14, 2019 12:06 pm
hoppy08520 wrote:
Sat Feb 17, 2018 2:31 pm
Step 0 - make sure that you have your HSA checkbook. You might have gotten one when your account was opened. You'll need to write a check to the new HSA to rollover your money.
Do you remember why you used a check rather than requested an ACH withdrawal into your linked checking account (then wrote a check to HSA Bank from there)? (If you had a linked checking account...)

Maybe you discovered that there was an unadvertised limit on the amount you could withdraw via ACH in any one day?
Hmmm, cas, maybe that's what I should have done? I've never expensed a claim from my HSA--I've just used the HSA for investing. As such, I never linked my HSA to my checking account since I didn't need to. But maybe that's what I should have done? As I wrote, I asked BenefitWallet to send me a distribution check, but my balance was too large so they would not do so because of security reasons (which I can understand). Maybe what I should have done is what you suggest, initiate an ACH withdrawal from BW to my checking account, then write a check to the new HSA from my own checking account, for the rollover.

So, in the end, I found that writing a check from the old HSA account, payable to the new HSA, did work. I also thought that approach might be more mistake-proof, to have the funds withdrawn directly from the old HSA, instead of passing through me as an intermediary. Granted, I do realize that the latter approach is permissible as long as you complete the rollover within 60 days, but I was afraid of making a mistake.

cas
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Joined: Wed Apr 26, 2017 8:41 am

Re: Tips for closing out BenefitWallet HSA via direct rollover to new HSA

Post by cas » Mon Jan 14, 2019 1:32 pm

hoppy08520 wrote:
Mon Jan 14, 2019 12:39 pm
cas wrote:
Mon Jan 14, 2019 12:06 pm
hoppy08520 wrote:
Sat Feb 17, 2018 2:31 pm
Step 0 - make sure that you have your HSA checkbook. You might have gotten one when your account was opened. You'll need to write a check to the new HSA to rollover your money.
Do you remember why you used a check rather than requested an ACH withdrawal into your linked checking account (then wrote a check to HSA Bank from there)? (If you had a linked checking account...)

Maybe you discovered that there was an unadvertised limit on the amount you could withdraw via ACH in any one day?
So, in the end, I found that writing a check from the old HSA account, payable to the new HSA, did work. I also thought that approach might be more mistake-proof, to have the funds withdrawn directly from the old HSA, instead of passing through me as an intermediary. Granted, I do realize that the latter approach is permissible as long as you complete the rollover within 60 days, but I was afraid of making a mistake.
I think I'm coming to the same conclusion that, if I'm doing a 60-day-rollover, it seems that "writing a check from the old HSA account, payable to the new HSA" seems to leave the best paper trail of what was intended and have the least chance for error.

As I read your OP again, I started thinking that it is entirely likely that BenefitWallet might enforce the same security limit on an ACH transfer than they did on writing a check to you. Except that it has more potential for going badly: I request ACH of the entire balance to my checking account, it initially looks like it goes through, but only $3000 ( or whatever the limit is ... $3000 is the debit card daily limit) actually lands in my checking. And then I would be up the creek without a paddle with the whole deal about only 1 withdrawal can count towards the "one per year" 60-day-rollover limit.

Thanks for your help and quick responses.

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hoppy08520
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Re: Tips for closing out BenefitWallet HSA via direct rollover to new HSA

Post by hoppy08520 » Mon Jan 14, 2019 2:13 pm

cas wrote:
Mon Jan 14, 2019 1:32 pm
hoppy08520 wrote:
Mon Jan 14, 2019 12:39 pm
cas wrote:
Mon Jan 14, 2019 12:06 pm
hoppy08520 wrote:
Sat Feb 17, 2018 2:31 pm
Step 0 - make sure that you have your HSA checkbook. You might have gotten one when your account was opened. You'll need to write a check to the new HSA to rollover your money.
Do you remember why you used a check rather than requested an ACH withdrawal into your linked checking account (then wrote a check to HSA Bank from there)? (If you had a linked checking account...)

Maybe you discovered that there was an unadvertised limit on the amount you could withdraw via ACH in any one day?
So, in the end, I found that writing a check from the old HSA account, payable to the new HSA, did work. I also thought that approach might be more mistake-proof, to have the funds withdrawn directly from the old HSA, instead of passing through me as an intermediary. Granted, I do realize that the latter approach is permissible as long as you complete the rollover within 60 days, but I was afraid of making a mistake.
I think I'm coming to the same conclusion that, if I'm doing a 60-day-rollover, it seems that "writing a check from the old HSA account, payable to the new HSA" seems to leave the best paper trail of what was intended and have the least chance for error.

As I read your OP again, I started thinking that it is entirely likely that BenefitWallet might enforce the same security limit on an ACH transfer than they did on writing a check to you. Except that it has more potential for going badly: I request ACH of the entire balance to my checking account, it initially looks like it goes through, but only $3000 ( or whatever the limit is ... $3000 is the debit card daily limit) actually lands in my checking. And then I would be up the creek without a paddle with the whole deal about only 1 withdrawal can count towards the "one per year" 60-day-rollover limit.
Ah, you might be right, you might have even more security issues with an ACH transfer than with a paper check in the mail.

Either way, what you wrote ("it seems that "writing a check from the old HSA account, payable to the new HSA" seems to leave the best paper trail of what was intended and have the least chance for error.") is what I was also trying to accomplish.

Good luck, within a few weeks you'll have your HSA $$$ in Fidelity and BenefitWallet will eventually disappear from memory :)

Technically, though, I'm still not entirely done with my BenefitWallet HSA. When I file my 2018 taxes in the new few weeks, I think I'll need to include something about the rollover in Form 8889. I will need to figure this out soon...

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