Best HSA (2017)

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rgurmankin
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Best HSA (2017)

Post by rgurmankin » Mon Jan 02, 2017 2:43 pm

Starting an HSA this year and wondering about best place to put the money. Planning on letting the money accumulate; not use for current med. expenses. Wife & I are in late '50s and self employed. I know HSA Bank has been recommended in older posts, but what about now. Found Sun FCU, which pays 2% on amounts over $5000 and 3% over 10k. No monthly fees. Down the line, I figure I could move the money to somewhere else that allows investment option. Anyone familiar with Sun or other suggestions. Thanks

Highlander1917
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Re: Best HSA (2017)

Post by Highlander1917 » Mon Jan 02, 2017 3:46 pm

I'm new to Bogleheads. 28 years old.

I spent a lot of time looking into this same issue over the past month. I ultimately chose Saturna Capital http://www.saturna.com/individual/hsa/ as the best place to start growing an investment HSA.

So long as you invest solely in Saturna's proprietary mutual funds, there is no cost to open, maintain, or close the account. Saturna also allows first-dollar investing. The only cost of the account is the relatively high expense ratio of an actively-managed fund ( 0.9% for Amana Income Institutional Shares). They also seem to have reasonable and intelligent customer service.

Other providers such as Health Saving Administrators and Health Equity have better fund options (Vanguard Admiral Shares), but the additional fixed costs of these accounts would push my total expense ratio to about 1-2% this year, since my maximum HSA balance for 2017 will be the individual contribution limit of about $3.5k. Once my HSA balance reaches about $10k, I would consider changing to Health Savings Administrators or Health Equity. There should be no cost to do this since there are no fees to close a proprietary account with Saturna and go to another provider.
Last edited by Highlander1917 on Mon Jan 02, 2017 6:48 pm, edited 1 time in total.

Spirit Rider
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Re: Best HSA (2017)

Post by Spirit Rider » Mon Jan 02, 2017 4:28 pm


danaht
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Re: Best HSA (2017)

Post by danaht » Mon Jan 02, 2017 5:16 pm

I am still waiting for Fidelity, Vanguard, and all the other discount brokerages to offer "free" HSA accounts like they do IRAs. I think it will happen soon if HSA contribution limits are increased and the eligibility qualifications for HSA accounts are lowered (both possible changes). Until then - I think the HSA Bank (+TD Ameritrade combo) is the closest thing to this setup.

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whodidntante
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Re: Best HSA (2017)

Post by whodidntante » Mon Jan 02, 2017 5:45 pm

danaht wrote:I am still waiting for Fidelity, Vanguard, and all the other discount brokerages to offer "free" HSA accounts like they do IRAs. I think it will happen soon if HSA contribution limits are increased and the eligibility qualifications for HSA accounts are lowered (both possible changes). Until then - I think the HSA Bank (+TD Ameritrade combo) is the closest thing to this setup.
That would be great but I wouldn't hold my breathe. There is more money out there invested in 401(k)s and IRAs, and it's easier to service those accounts. Using an HSA as a long-term investment tax shelter is a fringe thing to do.

Spirit Rider
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Re: Best HSA (2017)

Post by Spirit Rider » Mon Jan 02, 2017 6:41 pm

We have all been waiting for the mainstream providers to offer retail HSA accounts. I would be happy to pay $50/yr in fees.

I don't have a crystal ball, but think it is very unlikely. Remember, very few people use the Boglehead strategy of investing their contributions long term. This means there are a significant number of distributions from checks, debit cards and online bill pay. Therefore HSA accounts are far too expensive to operate, more like checking accounts than IRA accounts.

Here are some statistics for the year ending 12/31/2015 from the Employee Benefit Research Institute (EBRI):
  • Only about 20% of those with a qualifying HDHP actually opened an HSA.
  • Average company contribution was $948 (both individual and family plans)
  • Average employee contribution was $1,864 (both individual and family plans)
  • Average balance was $1,844
  • Only 3% invested their accounts beyond cash
There is roughly a thousand (that's right, trillions compared to billions) times as many assets in IRAs than HSAs.

Don't hold your breath is right.

Highlander1917
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Re: Best HSA (2017)

Post by Highlander1917 » Mon Jan 02, 2017 6:48 pm

Spirit Rider wrote:Check the Wiki Health savings account, HSA custodians and options
I think the Wiki could be improved regarding Saturna Capital. You have two options with Saturna: a brokerage account or a proprietary mutual funds account. The latter is free.

tj
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Re: Best HSA (2017)

Post by tj » Mon Jan 02, 2017 7:23 pm

Other providers such as Health Saving Administrators and Health Equity have better fund options (Vanguard Admiral Shares), but the additional fixed costs of these accounts would push my total expense ratio to about 1-2% this year, since my maximum HSA balance for 2017 will be the individual contribution limit of about $3.5k. Once my HSA balance reaches about $10k, I would consider changing to Health Savings Administrators or Health Equity. There should be no cost to do this since there are no fees to close a proprietary account with Saturna and go to another provider.
in my employer's plan, HealthEquity costs about 40 bps per year. I have to keep $2k in super low interest cash though. Optum Health is another one that seems to be affordable with Vanguard funds.

Highlander1917
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Re: Best HSA (2017)

Post by Highlander1917 » Mon Jan 02, 2017 9:02 pm

tj wrote:
Other providers such as Health Saving Administrators and Health Equity have better fund options (Vanguard Admiral Shares), but the additional fixed costs of these accounts would push my total expense ratio to about 1-2% this year, since my maximum HSA balance for 2017 will be the individual contribution limit of about $3.5k. Once my HSA balance reaches about $10k, I would consider changing to Health Savings Administrators or Health Equity. There should be no cost to do this since there are no fees to close a proprietary account with Saturna and go to another provider.
in my employer's plan, HealthEquity costs about 40 bps per year. I have to keep $2k in super low interest cash though. Optum Health is another one that seems to be affordable with Vanguard funds.
I should have mentioned that I counted cash balance requirements as an opportunity cost in my analysis of expense ratios. There are several providers that offer "no cost" or "low cost" accounts, but they don't allow first-dollar investing. If you have to keep $2k in low-interest cash, you might consider this an "expense" of $100/year interest (assuming you could have done 5% better investing). Obviously, though, someone might prefer having cash for health emergencies, or their account options may be limited by their employer.

Traveler
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Re: Best HSA (2017)

Post by Traveler » Mon Jan 02, 2017 10:23 pm

My HSA is through Optum (offered through work) and has Vanguard funds available and no admin fee if over a certain balance amount (don't recall what that is)

onourway
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Re: Best HSA (2017)

Post by onourway » Tue Jan 03, 2017 3:33 pm

I am just starting to think about using a portion of our HSA as long-term savings. I currently have an HSA in the bank chosen by my employer where their contributions and my own are made to. Can I continue to have that account, which is tied to my HSA debit card, and then move just a portion of the funds to another provider like Saturna or Health Equity only for the portion I wish to have invested? Or do I have to move the entire thing?

bloom2708
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Re: Best HSA (2017)

Post by bloom2708 » Tue Jan 03, 2017 3:40 pm

Don't you have to be covered by a High Deductible Health Plan (HDHP) to contribute to an HSA? Or can you contribute but not claim the tax benefit without the HDHP to go along with it?

My large company switched to a HDHP with HSA in 2012. There are still some bumps/hiccups along the road as it still seems "new" to the employees and administrators.

My company puts in $2,500 ($1,250 in Jan, $1,250 in July). I can then put in $4,250 (family) up to the total of $6,750. To add to that, you can do a payroll deduction for part of your contribution that comes out each pay period.

I tried to do my first contribution for 2017 today, but the totals for 2016 and 2017 were all wrong in my HSA. Been talking to support several times to try to get the numbers updated to match my contributions. Always interesting.
"We are not here to please, but to provoke thoughtfulness." --Unknown Boglehead

Spirit Rider
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Re: Best HSA (2017)

Post by Spirit Rider » Tue Jan 03, 2017 6:38 pm

onourway wrote:I am just starting to think about using a portion of our HSA as long-term savings. I currently have an HSA in the bank chosen by my employer where their contributions and my own are made to. Can I continue to have that account, which is tied to my HSA debit card, and then move just a portion of the funds to another provider like Saturna or Health Equity only for the portion I wish to have invested? Or do I have to move the entire thing?
You can have as many HSA accounts as you want. You can do as many trustee -> trustee transfers as you like, but many HSA providers charge a $25 fee for such transfers. You can only do one indirect transfer from one HSA to another with in a 12 month period among all HSAs. Usually an indirect transfer can be accomplished fee free.

You need to use your employer HSA to avoid FICA on your contributions.

onourway
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Re: Best HSA (2017)

Post by onourway » Tue Jan 03, 2017 6:46 pm

Spirit Rider wrote: You can have as many HSA accounts as you want. You can do as many trustee -> trustee transfers as you like, but many HSA providers charge a $25 fee for such transfers. You can only do one indirect transfer from one HSA to another with in a 12 month period among all HSAs. Usually an indirect transfer can be accomplished fee free.

You need to use your employer HSA to avoid FICA on your contributions.
Thanks. In laymans terms what is the difference between a trustee --> trustee transfer and an indirect transfer? I had hoped to move all funds over and above a base amount out of the local HSA, and then periodically do the same as my contributions again build. If that were limited to once per year due to fees I could live with that though.

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FIREchief
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Re: Best HSA (2017)

Post by FIREchief » Tue Jan 03, 2017 6:48 pm

whodidntante wrote:
danaht wrote:I am still waiting for Fidelity, Vanguard, and all the other discount brokerages to offer "free" HSA accounts like they do IRAs. I think it will happen soon if HSA contribution limits are increased and the eligibility qualifications for HSA accounts are lowered (both possible changes). Until then - I think the HSA Bank (+TD Ameritrade combo) is the closest thing to this setup.
That would be great but I wouldn't hold my breathe. There is more money out there invested in 401(k)s and IRAs, and it's easier to service those accounts. Using an HSA as a long-term investment tax shelter is a fringe thing to do.
Unknown to many, Fidelity does offer HSAs. The "problem" is that they are not generally available to the public. I gained access when my Megacorp switched from Optum to Fidelity for active employees with HDHPs. I was really happy when I received that email. The Fido HSA is just like any other brokerage account. No fees and no minimums in "core" accounts.
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

Spirit Rider
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Re: Best HSA (2017)

Post by Spirit Rider » Tue Jan 03, 2017 7:08 pm

onourway wrote:
Spirit Rider wrote: You can have as many HSA accounts as you want. You can do as many trustee -> trustee transfers as you like, but many HSA providers charge a $25 fee for such transfers. You can only do one indirect transfer from one HSA to another with in a 12 month period among all HSAs. Usually an indirect transfer can be accomplished fee free.

You need to use your employer HSA to avoid FICA on your contributions.
Thanks. In laymans terms what is the difference between a trustee --> trustee transfer and an indirect transfer? I had hoped to move all funds over and above a base amount out of the local HSA, and then periodically do the same as my contributions again build. If that were limited to once per year due to fees I could live with that though.
A trustee -> trustee transfer requires that your current custodian either initiate an ACH transfer to the other custodian or make out a check to the new custodian and either send it directly or through you to the new custodian. Then they must code it properly such that it does not get reported at all.

The easiest indirect rollover is when you write a check from the HSA account (assuming they provide checks). You can write this to yourself, cash it and write a check from your checking account to the new custodian. Also, you could write a check from the HSA account directly to the new custodian FBO your HSA account. Make sure to direct the new custodian that it is a rollover and not a contribution.

Depending on your current custodian, you might be able to do an ACH withdrawal. I have not dealt with a custodian that lets you do rollovers electronically. They have always required it to be manually with a form and a check.

Maybe other Bogleheads are aware of custodians where you can do free rollovers online. I'm pretty sure it would have to be the new custodian pulling from the current custodian. Then it looks like a withdrawal from the current custodian and the new one knows it is a rollover. Guys???

danaht
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Re: Best HSA (2017)

Post by danaht » Tue Jan 03, 2017 8:54 pm

FIREchief wrote:
whodidntante wrote:
danaht wrote:I am still waiting for Fidelity, Vanguard, and all the other discount brokerages to offer "free" HSA accounts like they do IRAs. I think it will happen soon if HSA contribution limits are increased and the eligibility qualifications for HSA accounts are lowered (both possible changes). Until then - I think the HSA Bank (+TD Ameritrade combo) is the closest thing to this setup.
That would be great but I wouldn't hold my breathe. There is more money out there invested in 401(k)s and IRAs, and it's easier to service those accounts. Using an HSA as a long-term investment tax shelter is a fringe thing to do.
Unknown to many, Fidelity does offer HSAs. The "problem" is that they are not generally available to the public. I gained access when my Megacorp switched from Optum to Fidelity for active employees with HDHPs. I was really happy when I received that email. The Fido HSA is just like any other brokerage account. No fees and no minimums in "core" accounts.
That's great! I know about Fidelity HSA's only because my neighbor's mail sometimes gets delivered to my mailbox by mistake. I think the brokerages could be offering these soon! There are new proposals in Washington where they would increase the maximum contribution to match the maximum out of pocket costs. In addition they may also allow some RMDs to roll over to HSA accounts! If all this happens - you can bet that these brokerages will start offering these accounts to get more assets under management.

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FIREchief
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Re: Best HSA (2017)

Post by FIREchief » Tue Jan 03, 2017 9:11 pm

danaht wrote: There are new proposals in Washington where they would increase the maximum contribution to match the maximum out of pocket costs. In addition they may also allow some RMDs to roll over to HSA accounts! If all this happens - you can bet that these brokerages will start offering these accounts to get more assets under management.
This in very interesting. Trump has suggested that HSA's would be a major part of his approach to continuing health care reform. IIRC, the whole HDHP/HSA thing got started under the Bush administration but, as we all know, things got a bit choppy after that.
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

onourway
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Re: Best HSA (2017)

Post by onourway » Tue Jan 03, 2017 9:31 pm

Highlander1917 wrote:I'm new to Bogleheads. 28 years old.

I spent a lot of time looking into this same issue over the past month. I ultimately chose Saturna Capital http://www.saturna.com/individual/hsa/ as the best place to start growing an investment HSA.

So long as you invest solely in Saturna's proprietary mutual funds, there is no cost to open, maintain, or close the account. Saturna also allows first-dollar investing. The only cost of the account is the relatively high expense ratio of an actively-managed fund ( 0.9% for Amana Income Institutional Shares). They also seem to have reasonable and intelligent customer service.

Other providers such as Health Saving Administrators and Health Equity have better fund options (Vanguard Admiral Shares), but the additional fixed costs of these accounts would push my total expense ratio to about 1-2% this year, since my maximum HSA balance for 2017 will be the individual contribution limit of about $3.5k. Once my HSA balance reaches about $10k, I would consider changing to Health Savings Administrators or Health Equity. There should be no cost to do this since there are no fees to close a proprietary account with Saturna and go to another provider.
Can you explain how you get 1-2% total expense ratio from Health Savings Administrators? I'm seeing $45/year Admin fee which works out to 0.015% on an initial $3000 investment. Plus their Investment wrap of 0.25%. Invest it in VTSAX at 0.05% and I'm at .315% with no minimum balance required. Are there transfer fees or something else I'm not considering?

Health Equity's fees are slightly lower but I take it you are counting the opportunity loss of the $2000 or so required minimum balance?

nps
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Re: Best HSA (2017)

Post by nps » Tue Jan 03, 2017 9:54 pm

onourway wrote:Can you explain how you get 1-2% total expense ratio from Health Savings Administrators? I'm seeing $45/year Admin fee which works out to 0.015% on an initial $3000 investment.
Calculation error?

45/3000 = .015 = 1.5%

onourway
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Re: Best HSA (2017)

Post by onourway » Tue Jan 03, 2017 10:01 pm

nps wrote:
onourway wrote:Can you explain how you get 1-2% total expense ratio from Health Savings Administrators? I'm seeing $45/year Admin fee which works out to 0.015% on an initial $3000 investment.
Calculation error?

45/3000 = .015 = 1.5%
D'oh. More than time for bed over here... :oops:

djheini
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Re: Best HSA (2017)

Post by djheini » Tue Jan 03, 2017 10:03 pm

FIREchief wrote:
whodidntante wrote:
danaht wrote:I am still waiting for Fidelity, Vanguard, and all the other discount brokerages to offer "free" HSA accounts like they do IRAs. I think it will happen soon if HSA contribution limits are increased and the eligibility qualifications for HSA accounts are lowered (both possible changes). Until then - I think the HSA Bank (+TD Ameritrade combo) is the closest thing to this setup.
That would be great but I wouldn't hold my breathe. There is more money out there invested in 401(k)s and IRAs, and it's easier to service those accounts. Using an HSA as a long-term investment tax shelter is a fringe thing to do.
Unknown to many, Fidelity does offer HSAs. The "problem" is that they are not generally available to the public. I gained access when my Megacorp switched from Optum to Fidelity for active employees with HDHPs. I was really happy when I received that email. The Fido HSA is just like any other brokerage account. No fees and no minimums in "core" accounts.
Not quite free. Fidelity charges a $12/quarter ($48 annually) fee for HSAs unless you have combined balances of $250k+ or your employer picks up the tab (mine did while I worked there, though I consider it worth paying to keep such flexibility in my HSA account now that I have a different employer. Though now that I'm not on a HDHP anymore, not sure if I can do better since I'm not actively contributing anymore.

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FIREchief
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Re: Best HSA (2017)

Post by FIREchief » Tue Jan 03, 2017 10:06 pm

djheini wrote:
Not quite free. Fidelity charges a $12/quarter ($48 annually) fee for HSAs unless you have combined balances of $250k+ or your employer picks up the tab (mine did while I worked there, though I consider it worth paying to keep such flexibility in my HSA account now that I have a different employer. Though now that I'm not on a HDHP anymore, not sure if I can do better since I'm not actively contributing anymore.
So, let's say, "not necessarily free." 8-)

That said, based upon my experiences both at Fidelity and elsewhere, I would consider $12/quarter for Fidelity to be a tremendous bargain!
I am not a lawyer, accountant or financial advisor. Any advice or suggestions that I may provide shall be considered for entertainment purposes only.

Dirghatamas
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Re: Best HSA (2017)

Post by Dirghatamas » Tue Jan 03, 2017 11:52 pm

Highlander1917 wrote:I
Other providers such as Health Saving Administrators and Health Equity have better fund options (Vanguard Admiral Shares), but the additional fixed costs of these accounts would push my total expense ratio to about 1-2% this year, since my maximum HSA balance for 2017 will be the individual contribution limit of about $3.5k. Once my HSA balance reaches about $10k, I would consider changing to Health Savings Administrators or Health Equity.
Highlander

I just logged in (new year and whatnot) into my HSA account and checked your math. It appears that perhaps each large employer has different deals with HSA providers. My employer's default HSA is with Healthequity and the investment fees are a bit weird. Instead of laying down a yearly % ER (which most people understand), Healthequity has a MONTHLY ER. Why not use a yearly like everyone else, I don't know. It also looks like the amount you need to keep as cash varies. For our account it seems to be 1000 dollars while others here are reporting 2000, so it seems to be employer dependent. They do have Vanguard institutional index funds which are lower ER than you can get at Vanguard itself, so some of the cost is actually negative... They also give us some nominal interest on the 1000 dollars but it is not even worth a peanut. It looks like my 1000 dollars earned a whole 48 cents last year :sharebeer so basically the 1000 dollars is just sitting there.

Anyway, taking your 5% opportunity cost of investing that 1000 dollars, the numbers I get are

Cash Investments Total ER%
1000 4000 5000 1.32%
1000 9000 10000 0.86%
1000 19000 20000 0.63%

So my calculations are similar but a bit lower than yours. I agree that at ~10,000-20,000 total onwards, it is not a bad plan. Basically as the account grows, the drag from the 1000 dollars becomes less and less important.

I am staying put with this one (Healthequity) because I am lazy, unless someone shows a much better one.

FrankAZ
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Re: Best HSA (2017)

Post by FrankAZ » Fri Jan 20, 2017 4:06 pm

Similar but different question, but still seeking lowest net-cost investment vehicle for HSA contributions.

I have been using an HDHP since they came out. Love 'em. Always contributed the max (family) very early each year and never taken a withdrawal. Figure that if I have a choice I would prefer to spend money which is outside a tax-protected vehicle. I'm looking forward to retirement and reaping the benefits of the HSA as a supplement to other retirement plans.

Anyway, my wife was 55 last year so she can make $1000 catch-up contributions to an HSA since she is a covered member of our family HDHP, but it has to be into her own HSA. Until April 16 this year (2017) she can make a total contribution of $2000 as last year's $1000 and this year's $1000. She'll keep adding $1000 catch-ups in Jan of each TY while she is eligible. Of course, we'll keep maxing the family (my) HSA and next year I will be able to add my own catch-up to that.

So, I am looking for investment HSAs which are low-fee for the situation where there is one $1000 transfer and trade per year and no withdrawals. The admin with my own HSA (Optum) requires a $1500 cash balance behind the investment and so far I have not been able to speak to anyone who can waive that for my wife even though I carry such a balance, reluctantly, on my own HSA. I'd crunch the numbers for best practical ROI, but so far I am stuck with few options for a simple investment HSA which allows her to invest all but a zero or nominal cash balance, and which allows a low start at $1000/yr.

There must be many 55+ year old investors who use HSAs as a particularly attractive retirement vehicle and would have a similar buy-and-hold strategy which would reduce admin costs. Lots (most?) of them are probably married. There seems to be an opportunity for an admin to offer family discounts for HSAs and recognize that the 2-HSA family has to exist, but that doubling the cash float is burdensome.

Ideas?

Frank.

Oliver
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Re: Best HSA (2017)

Post by Oliver » Wed Jan 25, 2017 3:34 pm

FrankAZ wrote:Similar but different question, but still seeking lowest net-cost investment vehicle for HSA contributions.

Frank.
As mentioned upthread, check out the HSA wiki. I found Saturna was the lowest net cost provider for me. The thread below should give you some info.

Minimize Costs

I do not reinvest dividends. I combine my dividends and annual contribution and purchase one ETF per year. My total annual cost is $14.95 ($14.95 for the trade with no maintenance fees). If you stop contributing, it is cheaper to buy an etf/stock ($14.95) with the dividends than pay the $25 inactivity fee.

viewtopic.php?t=135513

Morgan22
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Re: Best HSA (2017)

Post by Morgan22 » Wed Jan 25, 2017 3:59 pm

I think SelectAccount is the best deal for HSA's now.
But you can compare hundreds of HSA's on hsasearch.com

Easy Rhino
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Re: Best HSA (2017)

Post by Easy Rhino » Fri Jan 27, 2017 2:38 pm

Morgan22 wrote:I think SelectAccount is the best deal for HSA's now.
But you can compare hundreds of HSA's on hsasearch.com

SelectAccount seems interesting, first I've heard of it. Do you have it?

If I understand it, once your account balance is over $10k, you can keep $1000 in cash, and then the rest in a self directed brokerage account at Schwab.

Any other fees on either the SelectAccount or Schwab side? If I read it right there may be a $18 annual fee + a $1 monthly fee for using investments?

discman017
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Re: Best HSA (2017)

Post by discman017 » Fri Jan 27, 2017 3:47 pm

I see these "best HSA" threads every so often, and I never understand why everyone who wants an HSA investment account doesn't go with the Saturna brokerage account.

This is Bogleheads -- we all want the lowest fees, right? HSA investment accounts charge fees in three ways:
1. Per-trade fee
2. Monthly / annual account maintenance fee
3. Foregone interest (for the HSAs that require you to have a certain amount of cash in the account, earning a below-market interest rate, before you can make investment transactions)

Saturna charges $15 for a trade. If you make at least one trade per year, there are no additional fees. So the grand total is $15 per year. No account maintenance fees. No requirement to hold funds in cash, so no foregone interest. (And if you forget to make your one trade per year, they charge you a $25 inactive account fee. Still very cheap.)

I've investigated lots of other HSAs, and when you add up the fees (#1, #2, and #3 above), it's always significantly more than fifteen bucks a year.

Totally understand if you want an FDIC-insured account for short-term medical expenses. That's something different. But if you're using your HSA as a long-term investment account, I really don't understand why everyone doesn't just use Saturna.

So does someone know of an HSA investment provider with lower fees? Or is there some reason other than fees to go with a provider other than Saturna? I follow these threads and am genuinely baffled that this discussion hasn't been put to rest already. What am I missing? Thanks!

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jhfenton
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Re: Best HSA (2017)

Post by jhfenton » Fri Jan 27, 2017 6:48 pm

Easy Rhino wrote:
Morgan22 wrote:I think SelectAccount is the best deal for HSA's now.
But you can compare hundreds of HSA's on hsasearch.com

SelectAccount seems interesting, first I've heard of it. Do you have it?

If I understand it, once your account balance is over $10k, you can keep $1000 in cash, and then the rest in a self directed brokerage account at Schwab.

Any other fees on either the SelectAccount or Schwab side? If I read it right there may be a $18 annual fee + a $1 monthly fee for using investments?
That's what it looks like. At least $1/month plus $18/year plus $1,000 kept in cash. I was intrigued there for a minute, thinking $0 plus $1,000 kept in cash to get access to Schwab. That would have been compelling.

But in the end, it's not as good as Saturna. Like discman017, I think Saturna is far and away the best option for buy and hold HSA investors.

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gasdoc
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Re: Best HSA (2017)

Post by gasdoc » Fri Jan 27, 2017 10:00 pm

Highlander1917 wrote:I'm new to Bogleheads. 28 years old.

I spent a lot of time looking into this same issue over the past month. I ultimately chose Saturna Capital http://www.saturna.com/individual/hsa/ as the best place to start growing an investment HSA.

So long as you invest solely in Saturna's proprietary mutual funds, there is no cost to open, maintain, or close the account. Saturna also allows first-dollar investing. The only cost of the account is the relatively high expense ratio of an actively-managed fund ( 0.9% for Amana Income Institutional Shares). They also seem to have reasonable and intelligent customer service.

Other providers such as Health Saving Administrators and Health Equity have better fund options (Vanguard Admiral Shares), but the additional fixed costs of these accounts would push my total expense ratio to about 1-2% this year, since my maximum HSA balance for 2017 will be the individual contribution limit of about $3.5k. Once my HSA balance reaches about $10k, I would consider changing to Health Savings Administrators or Health Equity. There should be no cost to do this since there are no fees to close a proprietary account with Saturna and go to another provider.
I use Saturna, and have a much larger amount in my HSA. I prefer to use mutual funds other than the proprietary Saturna funds, but only make one transaction per year. There are no fees based on the total amount in the fund, only the one transaction fee.

gasdoc

theplayer11
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Re: Best HSA (2017)

Post by theplayer11 » Fri Jan 27, 2017 10:36 pm

Saturna has a $10 charge for Vanguard funds..so $25 a year, still a great deal.

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gasdoc
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Re: Best HSA (2017)

Post by gasdoc » Sat Jan 28, 2017 9:14 am

theplayer11 wrote:Saturna has a $10 charge for Vanguard funds..so $25 a year, still a great deal.
Yes, that is what i do as well. I agree- a very good deal.

gasdoc

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Re: Best HSA (2017)

Post by willthrill81 » Sat Jan 28, 2017 11:19 am

Highlander1917 wrote:Other providers such as Health Saving Administrators and Health Equity have better fund options (Vanguard Admiral Shares), but the additional fixed costs of these accounts would push my total expense ratio to about 1-2% this year, since my maximum HSA balance for 2017 will be the individual contribution limit of about $3.5k. Once my HSA balance reaches about $10k, I would consider changing to Health Savings Administrators or Health Equity. There should be no cost to do this since there are no fees to close a proprietary account with Saturna and go to another provider.
My employer contributes $1,400 annually to an HSA at Health Equity, so I use them as well for simplicity's sake. This will be my first year to max out contributions to it, so I'll be investing the funds exceeding $2k shortly.

As a clarification, Health Equity only charges .40% on invested assets if you select "choice" funds. For those with employer 'sponsored' HSAs like myself, this fee may be paid by your employer for certain choice funds. With others, you are responsible for paying this fee. Unfortunately for me, I'll have to pay it in order to invest in any Vanguard funds. But the 'free' funds have really high expense ratios, so it's still cheaper for me to invest in Vanguard funds, especially since many of them are Admiral funds.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: Best HSA (2017)

Post by theplayer11 » Mon Jan 30, 2017 6:03 pm

In regards to Saturna..found this in the fine print(not in commission schedule):
"Dividend reinvestment for stocks or ETFs incur a fee of $1 per instance. Minimum dividend amount of $4, otherwise dividends will be swept to the account's cash option."
http://www.saturna.com/sbs/account_services.shtml

So, If you are holding a bond ETF, are they really going to whack you another $12 to reinvest the dividends? Throw in 2 other stock ETfs at 4 dividends per year, we are talking another $20 in very hidden fees.

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Re: Best HSA (2017)

Post by *3!4!/5! » Mon Jan 30, 2017 6:32 pm

willthrill81 wrote:
Highlander1917 wrote:Other providers such as Health Saving Administrators and Health Equity have better fund options (Vanguard Admiral Shares), but the additional fixed costs of these accounts would push my total expense ratio to about 1-2% this year, since my maximum HSA balance for 2017 will be the individual contribution limit of about $3.5k. Once my HSA balance reaches about $10k, I would consider changing to Health Savings Administrators or Health Equity. There should be no cost to do this since there are no fees to close a proprietary account with Saturna and go to another provider.
My employer contributes $1,400 annually to an HSA at Health Equity, so I use them as well for simplicity's sake. This will be my first year to max out contributions to it, so I'll be investing the funds exceeding $2k shortly.

As a clarification, Health Equity only charges .40% on invested assets if you select "choice" funds. For those with employer 'sponsored' HSAs like myself, this fee may be paid by your employer for certain choice funds. With others, you are responsible for paying this fee. Unfortunately for me, I'll have to pay it in order to invest in any Vanguard funds. But the 'free' funds have really high expense ratios, so it's still cheaper for me to invest in Vanguard funds, especially since many of them are Admiral funds.
My employer uses HealthEquity HSA. They pay the monthly admin fee , but NOT the 0.4% wrap fee. I would be very surprised if an employer paid that.

Also, starting soon, HealthEquity will have only "choice" funds so ALL investments will have the 0.4% wrap fee.

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Re: Best HSA (2017)

Post by *3!4!/5! » Mon Jan 30, 2017 6:34 pm

theplayer11 wrote:In regards to Saturna..found this in the fine print(not in commission schedule):
"Dividend reinvestment for stocks or ETFs incur a fee of $1 per instance. Minimum dividend amount of $4, otherwise dividends will be swept to the account's cash option."
http://www.saturna.com/sbs/account_services.shtml

So, If you are holding a bond ETF, are they really going to whack you another $12 to reinvest the dividends? Throw in 2 other stock ETfs at 4 dividends per year, we are talking another $20 in very hidden fees.
It's been widely discussed here. I don't think it'd "hidden". Also MF reinv is free.

That said, it is true that you are restricted to very minimal activity at Saturna if it to make financial sense.
Last edited by *3!4!/5! on Mon Jan 30, 2017 6:40 pm, edited 1 time in total.

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Re: Best HSA (2017)

Post by theplayer11 » Mon Jan 30, 2017 6:35 pm

*3!4!/5! wrote:
theplayer11 wrote:In regards to Saturna..found this in the fine print(not in commission schedule):
"Dividend reinvestment for stocks or ETFs incur a fee of $1 per instance. Minimum dividend amount of $4, otherwise dividends will be swept to the account's cash option."
http://www.saturna.com/sbs/account_services.shtml

So, If you are holding a bond ETF, are they really going to whack you another $12 to reinvest the dividends? Throw in 2 other stock ETfs at 4 dividends per year, we are talking another $20 in very hidden fees.
It's been widely discussed here. I don't think it'd "hidden". Also MF reinv is free.
not hidden?..can't get much more hidden, not on commission schedule listing all fees.

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Re: Best HSA (2017)

Post by *3!4!/5! » Mon Jan 30, 2017 6:43 pm

^^^ Okay, I admit I saw it widely discussed here, but I hadn't personally dug into the website. (I was considering Saturna to just hold one MF, but decided against it. I'm going with SelectAccount.)

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Re: Best HSA (2017)

Post by integritetus » Mon Jan 30, 2017 6:55 pm

theplayer11 wrote:In regards to Saturna..found this in the fine print(not in commission schedule):
"Dividend reinvestment for stocks or ETFs incur a fee of $1 per instance. Minimum dividend amount of $4, otherwise dividends will be swept to the account's cash option."
http://www.saturna.com/sbs/account_services.shtml

So, If you are holding a bond ETF, are they really going to whack you another $12 to reinvest the dividends? Throw in 2 other stock ETfs at 4 dividends per year, we are talking another $20 in very hidden fees.
Yes they will charge $1 per dividend reinvestment event for bond ETFs. Saturna discloses the fee for reinvesting ETF or stock dividends in the commission schedule:
http://www.saturna.com/sbs/commsch.shtml

See the line item for "Equity dividend reinvestments" in the additional services section. Note that there is no fee for reinvesting dividends for mutual funds.

Like some others, I hold Vanguard mutual funds in my Saturna HSA (actually a single position in Balanced Index Admiral shares) and usually make a single transaction per year. Usually a buy after making the annual contribution. More rarely a sell followed by a withdrawal after making the annual contribution. I'm quite pleased with the total cost of $25 per year (plus the fund ER, of course).

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Re: Best HSA (2017)

Post by theplayer11 » Mon Jan 30, 2017 7:20 pm

integritetus wrote:
theplayer11 wrote:In regards to Saturna..found this in the fine print(not in commission schedule):
"Dividend reinvestment for stocks or ETFs incur a fee of $1 per instance. Minimum dividend amount of $4, otherwise dividends will be swept to the account's cash option."
http://www.saturna.com/sbs/account_services.shtml

So, If you are holding a bond ETF, are they really going to whack you another $12 to reinvest the dividends? Throw in 2 other stock ETfs at 4 dividends per year, we are talking another $20 in very hidden fees.
Yes they will charge $1 per dividend reinvestment event for bond ETFs. Saturna discloses the fee for reinvesting ETF or stock dividends in the commission schedule:
http://www.saturna.com/sbs/commsch.shtml

See the line item for "Equity dividend reinvestments" in the additional services section. Note that there is no fee for reinvesting dividends for mutual funds.


Like some others, I hold Vanguard mutual funds in my Saturna HSA (actually a single position in Balanced Index Admiral shares) and usually make a single transaction per year. Usually a buy after making the annual contribution. More rarely a sell followed by a withdrawal after making the annual contribution. I'm quite pleased with the total cost of $25 per year (plus the fund ER, of course).
I apologize, I do see it now. So, probably best for me to go with the mutual fund equivalents to avoid the dividend reinvestment fees...although I do like to be able to trade during the day.
Are you satisfied with Saturna? Anything you are not pleased about? I'm hoping TD Ameritrade will do an in kind transfer, not holding my breath though.

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Re: Best HSA (2017)

Post by gasdoc » Tue Jan 31, 2017 6:30 am

integritetus wrote:
theplayer11 wrote:In regards to Saturna..found this in the fine print(not in commission schedule):
"Dividend reinvestment for stocks or ETFs incur a fee of $1 per instance. Minimum dividend amount of $4, otherwise dividends will be swept to the account's cash option."
http://www.saturna.com/sbs/account_services.shtml

So, If you are holding a bond ETF, are they really going to whack you another $12 to reinvest the dividends? Throw in 2 other stock ETfs at 4 dividends per year, we are talking another $20 in very hidden fees.
Yes they will charge $1 per dividend reinvestment event for bond ETFs. Saturna discloses the fee for reinvesting ETF or stock dividends in the commission schedule:
http://www.saturna.com/sbs/commsch.shtml

See the line item for "Equity dividend reinvestments" in the additional services section. Note that there is no fee for reinvesting dividends for mutual funds.

Like some others, I hold Vanguard mutual funds in my Saturna HSA (actually a single position in Balanced Index Admiral shares) and usually make a single transaction per year. Usually a buy after making the annual contribution. More rarely a sell followed by a withdrawal after making the annual contribution. I'm quite pleased with the total cost of $25 per year (plus the fund ER, of course).
+1

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Re: Best HSA (2017)

Post by gasdoc » Tue Jan 31, 2017 6:33 am

theplayer11 wrote:
integritetus wrote:
theplayer11 wrote:In regards to Saturna..found this in the fine print(not in commission schedule):
"Dividend reinvestment for stocks or ETFs incur a fee of $1 per instance. Minimum dividend amount of $4, otherwise dividends will be swept to the account's cash option."
http://www.saturna.com/sbs/account_services.shtml

So, If you are holding a bond ETF, are they really going to whack you another $12 to reinvest the dividends? Throw in 2 other stock ETfs at 4 dividends per year, we are talking another $20 in very hidden fees.
Yes they will charge $1 per dividend reinvestment event for bond ETFs. Saturna discloses the fee for reinvesting ETF or stock dividends in the commission schedule:
http://www.saturna.com/sbs/commsch.shtml

See the line item for "Equity dividend reinvestments" in the additional services section. Note that there is no fee for reinvesting dividends for mutual funds.


Like some others, I hold Vanguard mutual funds in my Saturna HSA (actually a single position in Balanced Index Admiral shares) and usually make a single transaction per year. Usually a buy after making the annual contribution. More rarely a sell followed by a withdrawal after making the annual contribution. I'm quite pleased with the total cost of $25 per year (plus the fund ER, of course).
I apologize, I do see it now. So, probably best for me to go with the mutual fund equivalents to avoid the dividend reinvestment fees...although I do like to be able to trade during the day.
Are you satisfied with Saturna? Anything you are not pleased about? I'm hoping TD Ameritrade will do an in kind transfer, not holding my breath though.
There is not much to be satisfied/dissatisfied with Saturna. You make one transaction per year, with one mutual fund. Customer service is good, if you need them. And you get to use Vanguard funds.

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Re: Best HSA (2017)

Post by integritetus » Tue Jan 31, 2017 8:36 am

theplayer11 wrote: Are you satisfied with Saturna? Anything you are not pleased about? I'm hoping TD Ameritrade will do an in kind transfer, not holding my breath though.
Saturna is a small, boutique mutual fund company. Their brokerage platform, including for HSA accounts, is provided by Pershing. I've found Saturna customer service to be very good. In my experience they have answered the phone promptly and spent as much time as I've desired answering my questions.

There is a significant amount of paperwork needed to establish a Saturna HSA, much of it Pershing's, and much of it in my opinion irrelevant for an HSA. The process for opening an HSA could be much more streamlined. But that is a one-time cost. The process is fairly well documented in this review thread:
viewtopic.php?f=10&t=135513

Given my and my spouse's intentions with our HSAs to hold single positions (one fund in each HSA) in Vanguard Admiral-class mutual funds for the long term with typically a single transaction per year in each account for annual contributions, we've found Saturna to be the best deal for us from the current HSA custodians.

A nice feature of the account is that they offer Vanguard Admiral-class funds without requiring the Admiral-class minimum investment. So when for example one of a couple first becomes eligible for the $1000 HSA catchup contribution and a second HSA account for the family needs to be opened, they could put that $1000 into say Vanguard Total Stock Index Admiral shares without meeting the $10K minimum.

Same (I assume, haven't personally tried it) for the Premium-class Fidelity Index funds with their $10K minimums, which can be bought for $15/transaction without the $10 surcharge that Saturna imposes for Vanguard funds. With a Fidelity index fund, the total cost per HSA account assuming a single transaction per year could be brought down to $15/year plus fund ER.

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Re: Best HSA (2017)

Post by jhfenton » Tue Jan 31, 2017 8:49 am

I definitely wouldn't hold a bond ETF at Saturna, but a once-a-year investment in an equity ETF with 4 x year dividend reinvestments would still be slightly cheaper at ($15 + $4) than a Vanguard mutual fund ($25).

I plan eventually to move my employer-sponsored HSA to Saturna, but it's not worth the hassle yet. I pay $2/month + 10 bp/year and one of the investment options is Vanguard 500 Index Admiral (VFIAX). With $34K in the account ($2K cash, $32K invested), I'm paying $56 per year in fees ($24 + $32). If I move everything to Saturna, I pay $19 or $25 per year, but I would have to keep the entire next year's growing balance in cash or pay the $2 + 10 bp.

So far, I haven't been motivated to move, but as the 10 bp wrap fee grows, I am getting there. At this point, with my wife between jobs, I want to wait and see what her new employer offers first. If we were to switch to an HSA through her employer, I could move mine once and be done with it.

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Re: Best HSA (2017)

Post by willthrill81 » Tue Jan 31, 2017 11:54 am

*3!4!/5! wrote:My employer uses HealthEquity HSA. They pay the monthly admin fee , but NOT the 0.4% wrap fee. I would be very surprised if an employer paid that.

Also, starting soon, HealthEquity will have only "choice" funds so ALL investments will have the 0.4% wrap fee.
AS of now, my employer does pay the wrap fee. I wasn't aware that they were removing everything except the 'choice' funds, but it's moot to me because I'd rather invest in Vanguard's funds anyway, even if I have to pay .4%.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

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Re: Best HSA (2017)

Post by angler-39 » Tue Jan 31, 2017 12:31 pm

Just to share personal experience-
Our megacorp is with mybenefitwallet. Megacorp pays the monthly fee ($2.90) and no additional user fees that we are aware of. I know mybenefitwallet has fees for individual accounts so I can't comment on that.
After maintaining $1,000 in cash, we can invest in mutual funds (about 25 available).
The only one that suits us is [VTSMX] VANGUARD TOTAL STOCKMARKET INVESTOR CLASS.
YMMV.

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Re: Best HSA (2017)

Post by Easy Rhino » Tue Jan 31, 2017 7:59 pm

With Saturna, I have a bond ETF. I just have dividends paid in cash, and then, when I make my annual trade, I lump them in with my rollover to make my purchase.

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Re: Best HSA (2017)

Post by Thrifty Femme » Tue Jan 31, 2017 8:58 pm

Can anyone comment on the process to withdraw money from a Saturna HSA?

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Re: Best HSA (2017)

Post by theplayer11 » Tue Jan 31, 2017 9:02 pm

Thrifty Femme wrote:Can anyone comment on the process to withdraw money from a Saturna HSA?
you can set up ACH and have withdrawls to your bank, but I believe you have to call in to initiate..can't do it yourself online

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