Selecting HSA custodian

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big bang
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Joined: Mon Jul 25, 2016 8:33 pm

Selecting HSA custodian

Post by big bang » Thu Jul 12, 2018 1:02 pm

Hello everyone,

My son's company notified them that as of the end of the month they are going to discontinue the HSA plan due to low adoption. He was one of the few that participated in this plan from his organization. I believe he has around $7K in the account. His current custodian will start charging him $6.00 a month maintenance fee and they do not have any investment options.
We are looking in to transferring his account.
I have looked up the Wiki, but there are just too many options and it does not look easy to compare between them (https://www.bogleheads.org/wiki/Health_savings_account).

Are there any recommendations out there for a good custodian with low maintenance fees and good investment options?

Thank you everyone for all the advice!
(1) save a lot, (2) select an asset allocation containing both stock and bond asset classes, (3) buy low cost, widely diversified funds, (4) allocate funds tax-efficiently, and (5) stay the course.

mcraepat9
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Joined: Thu Jul 16, 2015 11:46 am

Re: Selecting HSA custodian

Post by mcraepat9 » Thu Jul 12, 2018 1:04 pm

This website has a chart that I found helpful:

https://20somethingfinance.com/best-hsa-account/
Amateur investors are not cool-headed logicians.

deltaneutral83
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Joined: Tue Mar 07, 2017 4:25 pm

Re: Selecting HSA custodian

Post by deltaneutral83 » Thu Jul 12, 2018 1:10 pm

This is very simple. Lively. $2.50 a month all in, and you have access to TDA which has state street's ETFs commission free (SPTM is the the U.S. TSM index). You can keep $0 in the checking account at Lively.

ColoradoRob
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Joined: Thu Aug 27, 2015 8:47 am

Re: Selecting HSA custodian

Post by ColoradoRob » Thu Jul 12, 2018 1:26 pm

I second that advice on going with Lively. I'm very surprised and pleased with how decent they are as an HSA provider. Monthly investing fee comes out of an external (bank) account rather than from draining funds from within the HSA itself (which saps returns over time). That alone is reason enough to go with them.

DippityDoo
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Re: Selecting HSA custodian

Post by DippityDoo » Thu Jul 12, 2018 1:29 pm

Another vote for Lively. Here's the list of commission-free ETFs available at TD Ameritrade.

A few State Street tickers you may find helpful are
SPAB- Total Bond
SPTM- Total Stock Market
SPDW- International
SPEM- Emerging Markets
Last edited by DippityDoo on Thu Jul 12, 2018 1:31 pm, edited 1 time in total.

tenkuky
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Re: Selecting HSA custodian

Post by tenkuky » Thu Jul 12, 2018 1:30 pm

And I third that suggestion.
I've opened an account at Lively and will move my deducted monies from work HSA to it soon.
Flat fee for investments taken out of external ACH account, quick customer service (phone and chat).

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flossy21
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Re: Selecting HSA custodian

Post by flossy21 » Thu Jul 12, 2018 1:35 pm

I also use and recommend Lively. It is the best out there for people that use their HSA as an investment vehicle.

$2.50 a month is all they charge and the fee comes out of a linked bank account..not your HSA funds.
You can invest 100% of your HSA funds from day one. No hold backs or minimums.
They offer a broad range of index ETF's that should allow customers to make good portfolio choices.

theplayer11
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Joined: Tue Jul 22, 2014 8:55 pm

Re: Selecting HSA custodian

Post by theplayer11 » Thu Jul 12, 2018 1:58 pm

saturna is cheapest option if you are trading once a year. $14.95 a trade, but $10 more for Vanguard funds. I pay $24.95 a year.

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jhfenton
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Location: Ohio

Re: Selecting HSA custodian

Post by jhfenton » Thu Jul 12, 2018 8:01 pm

My wife and I use Lively too. Their customer service is very responsive. I have 100% of my money invested at TD Ameritrade and transfer new money in roughly quarterly from my employer-sponsored HSA. (I'm lucky my employer-sponsored HSA does not charge a transfer fee.) My wife's new employer puts $1,000 per year in hers divided over 26 paychecks. It's not enough to be worth investing--or wouldn't be for quite a while--so we are reimbursing out of it. She pays no fees whatsoever. I pay $2.50/month from checking.

If you put in a lump sum by yourself once a year and don't move your account for many years (>5-15), Saturna may come out marginally ahead. But if you contribute through payroll, the cash drag while you let your cash accumulate for a year makes Saturna more expensive. Also, Saturna has a $25 inactivity fee if you don't have a transaction for a year. And they have a $75 account transfer fee. And they have a stack of literal paperwork that you have to send in.

Lively's setup is quick and 100% online.

SQ7N3mvB
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Re: Selecting HSA custodian

Post by SQ7N3mvB » Fri Jul 13, 2018 5:40 am

After switching from HSABank to Lively based on Boglehead recommendations, I also highly recommend Lively. TDAMeritrade is the brokerage investment option, friendly+knowledgeable+responsive customer service at Lively, fees drawn on non-HSA account and a website that works well.

I strongly advise avoiding HSABank. Over 4 years as a client, I experienced multiple frustrations with incompetent and unfriendly customer service, a frequently outdated and programmatically flawed website and poor overall product policies. Management simply did not care about customer service or retention in my experience.

I'm hopeful Jack Bogle will address the feasibility of Vanguard entering the personal HSA market. It's probably a long shot (both him answering and Vanguard entering that market) but since this site is where I first learned about Lively and found so much helpful advice about HSA custodians, I thought others might be interested in hearing Jack's answer too.

SpideyIndexer
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Re: Selecting HSA custodian

Post by SpideyIndexer » Tue Sep 04, 2018 11:27 pm

Lively sounds interesting as a custodian. However is seems difficult to find on Lively's website what TD Ameritrade funds are offered as HSA investments and their performance and fees. Probably I am missing something. Do you have any pointers on how to quickly get this information?

Going to TD Ameritrade's site, it seems mostly straightforward to sort ETFs by expense ratio in order to see their boglehead-friendly index investments. Lively says I can invest in ETFs offered by TD Ameritrade, though they don't quite say if I can invest in all of them or a subset.

ClassySDLivin
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Re: Selecting HSA custodian

Post by ClassySDLivin » Tue Sep 04, 2018 11:59 pm

Another option - I use Bank Of America's HSA service - fee free if you are a Platinum Preferred customer. I have all of the investable amount (anything over $1k) in a low expense S&P 500 fund. For me, it's easy and cheap.

aristotelian
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Re: Selecting HSA custodian

Post by aristotelian » Wed Sep 05, 2018 6:16 am

SpideyIndexer wrote:
Tue Sep 04, 2018 11:27 pm
Lively sounds interesting as a custodian. However is seems difficult to find on Lively's website what TD Ameritrade funds are offered as HSA investments and their performance and fees. Probably I am missing something. Do you have any pointers on how to quickly get this information?

Going to TD Ameritrade's site, it seems mostly straightforward to sort ETFs by expense ratio in order to see their boglehead-friendly index investments. Lively says I can invest in ETFs offered by TD Ameritrade, though they don't quite say if I can invest in all of them or a subset.
All of them. Lively just manages your contributions and withdrawals. TD manages your investments. Once your money goes from Lively to TD, you are using TD's brokerage platform, including their commission free ETF list.

Also, +1 for Lively. Same TD platform as HSA Bank but half the monthly fee.

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jhfenton
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Location: Ohio

Re: Selecting HSA custodian

Post by jhfenton » Wed Sep 05, 2018 7:37 am

aristotelian wrote:
Wed Sep 05, 2018 6:16 am
SpideyIndexer wrote:
Tue Sep 04, 2018 11:27 pm
Lively sounds interesting as a custodian. However is seems difficult to find on Lively's website what TD Ameritrade funds are offered as HSA investments and their performance and fees. Probably I am missing something. Do you have any pointers on how to quickly get this information?

Going to TD Ameritrade's site, it seems mostly straightforward to sort ETFs by expense ratio in order to see their boglehead-friendly index investments. Lively says I can invest in ETFs offered by TD Ameritrade, though they don't quite say if I can invest in all of them or a subset.
All of them. Lively just manages your contributions and withdrawals. TD manages your investments. Once your money goes from Lively to TD, you are using TD's brokerage platform, including their commission free ETF list.

Also, +1 for Lively. Same TD platform as HSA Bank but half the monthly fee.
+2 to "all of them." Through Lively, you can open a full-fledged brokerage account at TD Ameritrade in which you can invest in anything you could if you opened an IRA directly with TD Ameritrade. The best options for recurring contributions are probably on the TD Ameritrade commission-free ETF list found here. If you sort by Net Expense Ratio, you can find a number of dirt-cheap core investment options.

SpideyIndexer
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Joined: Thu Apr 02, 2015 10:13 pm

Re: Selecting HSA custodian

Post by SpideyIndexer » Thu Sep 13, 2018 7:01 pm

Sounds like a good deal!

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