New HSA provider Lively offers investments for $30/yr fee

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Muse94552
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Re: New HSA provider Lively offers investments for $30/yr fee

Post by Muse94552 » Wed May 02, 2018 1:15 pm

I'm enjoying the boglehead discussion about Lively, and have confirmed I am eligible for a one-time transfer from IRA to HSA. But I hesitate- is anyone ELSE worried that Lively will disappear in a couple of years/be sold or actually fail? :oops:
I realize that Lively deposits are theoretically in SPIC or FDIC insured accounts, but only indirectly. Is my concern unwarranted?

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jhfenton
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Re: New HSA provider Lively offers investments for $30/yr fee

Post by jhfenton » Wed May 02, 2018 1:35 pm

Muse94552 wrote:
Wed May 02, 2018 1:15 pm
I'm enjoying the boglehead discussion about Lively, and have confirmed I am eligible for a one-time transfer from IRA to HSA. But I hesitate- is anyone ELSE worried that Lively will disappear in a couple of years/be sold or actually fail? :oops:
I realize that Lively deposits are theoretically in SPIC or FDIC insured accounts, but only indirectly. Is my concern unwarranted?
It's possible that Lively will go under and that I'll have to move my account to another provider that I won't like as much. That would be an inconvenience, though, not a disaster. My investments are custodied at TD Ameritrade. Any cash in my Lively HSA account (usually zero) is custodied at Choice Financial bank. Lively going under would not put any of my assets at risk.

The worst part of Lively going under would be what it says about the viability of the business model of the low-cost HSA investment provider.

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indexfundfan
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Re: New HSA provider Lively offers investments for $30/yr fee

Post by indexfundfan » Wed May 16, 2018 8:21 am

Just completed my latest money transfer from my bank to Lively/TDA. This time it took T+4 days for money to appear in TDA for trading, an improvement of one day from my last transfer.
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tenkuky
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Re: New HSA provider Lively offers investments for $30/yr fee

Post by tenkuky » Wed May 16, 2018 10:45 am

indexfundfan wrote:
Wed May 16, 2018 8:21 am
Just completed my latest money transfer from my bank to Lively/TDA. This time it took T+4 days for money to appear in TDA for trading, an improvement of one day from my last transfer.
To confirm, did you do from an HSA trustee-to-trustee transfer? Or just an individual contribution to Lively?
I was planning (once I start) to do the employer linked HSA provider distribution to me, I deposit check and simultaneously ACH the same amount from checking to Lively. The Lively rep suggested it is seamless and both send me 5498 so I can handle my taxes. Plus, this way no fees vs. $25 for the transfer way.

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indexfundfan
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Re: New HSA provider Lively offers investments for $30/yr fee

Post by indexfundfan » Wed May 16, 2018 11:53 am

tenkuky wrote:
Wed May 16, 2018 10:45 am
indexfundfan wrote:
Wed May 16, 2018 8:21 am
Just completed my latest money transfer from my bank to Lively/TDA. This time it took T+4 days for money to appear in TDA for trading, an improvement of one day from my last transfer.
To confirm, did you do from an HSA trustee-to-trustee transfer? Or just an individual contribution to Lively?
I was planning (once I start) to do the employer linked HSA provider distribution to me, I deposit check and simultaneously ACH the same amount from checking to Lively. The Lively rep suggested it is seamless and both send me 5498 so I can handle my taxes. Plus, this way no fees vs. $25 for the transfer way.
My example was a bank-to-TDA transfer. It is not a trustee-to-trustee direct transfer.

If you are going to deposit the check into your account and ACH the money to Lively, yes, you are going to see the same T+4 days as me before money can be invested at TDA.
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MJR84
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Re: New HSA provider Lively offers investments for $30/yr fee

Post by MJR84 » Sun May 20, 2018 9:26 pm

jhfenton wrote:
Wed May 02, 2018 1:35 pm
Muse94552 wrote:
Wed May 02, 2018 1:15 pm
I'm enjoying the boglehead discussion about Lively, and have confirmed I am eligible for a one-time transfer from IRA to HSA. But I hesitate- is anyone ELSE worried that Lively will disappear in a couple of years/be sold or actually fail? :oops:
I realize that Lively deposits are theoretically in SPIC or FDIC insured accounts, but only indirectly. Is my concern unwarranted?
It's possible that Lively will go under and that I'll have to move my account to another provider that I won't like as much. That would be an inconvenience, though, not a disaster. My investments are custodied at TD Ameritrade. Any cash in my Lively HSA account (usually zero) is custodied at Choice Financial bank. Lively going under would not put any of my assets at risk.

The worst part of Lively going under would be what it says about the viability of the business model of the low-cost HSA investment provider.
Naive question: How do we know that, if Lively went out of business, investments made through the Fidelity platform would be safe? It makes perfect sense to me that they would, but (unlike FDIC protections) I don't really understand the mechanics of how a scenario like this would work.

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MossySF
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Re: New HSA provider Lively offers investments for $30/yr fee

Post by MossySF » Mon May 21, 2018 1:00 am

MJR84 wrote:
Sun May 20, 2018 9:26 pm
Naive question: How do we know that, if Lively went out of business, investments made through the Fidelity platform would be safe? It makes perfect sense to me that they would, but (unlike FDIC protections) I don't really understand the mechanics of how a scenario like this would work.
The accounts are under your name so Lively is just an administrator. For them to access your accounts for their own purposes, they'd need to make some type of fraudulent activity -- say example making up some fake medical bills to then use your funds to pay themselves. SIPC exists for this purpose ... you are protected to up to $500K of assets ($250K cash) against fraud/improper comingling/etc in a brokerage account. (It does not protect you against value drops of the underlying assets.)

financeidiot
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Re: New HSA provider Lively offers investments for $30/yr fee

Post by financeidiot » Mon May 21, 2018 8:21 am

Switched to Lively a few months ago. I've since lost my HSA eligibility (new employer has no HSA eligible plans) and they've been extremely helpful in navigating how much I need to withdraw and what the rules would be if I get my eligibility back later this year. Best and fastest service I've ever had from a financial institution. For contrast, my old HSA provider would just send me a link to the IRS website and tell me to figure it out.

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