Dave and Katy’s Travels | An Investment, retirement, and travel blog

I e-mailed Fidelity with my common request, which is something like “I want to give you all my accounts if you can administer my HSA”, and the response I received was:

Thank you for inquiring about Health Savings Accounts(HSA’s) at Fidelity.

At this time Fidelity is not able to provide that service of a HSA administrator. While we have been doing a small pilot plan with some of our institutional clients, we have not opened the HSA administration service to the general public.

Unfortunately, we do not have a time frame to provide you as to when we might offer this service.

If you have any other questions or comments, please send us another message at any time. Mr. Person, know you have a choice when it comes to investment companies, and we appreciate your interest in Fidelity.

I liked their reply in that they actually say they’re doing a pilot to see how it works. So hopefully these larger brokerage houses will start offering this plan sometime soon.

Read Full Post »

I received a response from Vanguard when I asked them if they offered HSA Administration.

Thank you for your e-mail. We appreciate the time you have taken to contact
us.

Vanguard is examining the feasibility of offering Health Savings Accounts
(HSAs), but has no firm plans at this time.

Vanguard is aware of some HSA programs featuring Vanguard mutual funds. It
appears that these parties are providing HSA administration and offering
Vanguard mutual fund investments via an investment-only relationship.
Vanguard has not formed a direct partnership in providing an HSA program at
this time.

Additional information regarding HSAs can be found under the ‘Account Types
& Services’ sub-link of our ‘Personal Investors’ homepage. Next, click the
two HSA-related links on the right-hand side of the page under the ‘Also of
interest’ heading.

If you have additional questions or would like more information on
consolidating your assets with Vanguard, please contact Vanguard
Specialized Services at 1-800-337-8476. We are available Monday through
Friday from 8 a.m. to 8 p.m. Eastern time. An associate will be pleased to
assist you.

So I’ll need to continue bothering brokerage houses until I find one that does offer HSA Administration. One reason I like E-Trade is that I can keep my taxable (with individual stocks), IRA, Roth IRA, and emergency savings (high yield savings account) accounts all in the same location. If I’m going to have an HSA that needs an administrator, I want my brokerage house to handle that as well.

Read Full Post »

E-Trade did actually respond to my previous query on the same day I asked it, I just assumed they would e-mail me the answer. Instead, it was in their online message system (somewhat strange, and hard to find in their interface). In either case, they say that they don’t have an option for HSA rollover, and don’t currently know of any plans to offer such a thing.

I just saw an early retirement forum post earlier today that Vanguard may be offering an HSA solution. I’m going to look into that and see what Vanguard says.

Read Full Post »

If you haven’t read about them, HSA accounts are the best thing thing Roth IRAs. In fact, they’re really the best account type ever created. First, they accept funding pre-tax, just like a 401k or IRA. So you can lower your tax burden by putting your max towards this account. Then you can invest these funds (using your HSA Administrator) to grow the funds over time. Finally, you can use the funds at any point, Tax Free, for any health care costs. So the money you use to fund this account is never taxed. To top it off, if you hit 65 and have way too much money in this account, you can start withdrawing your funds as income (just like a 401k/IRA account), so you’re not completely restricted.

Now, the only large issue in the above information is the “using your HSA Administrator”. Of course like 401k accounts, your HSA account needs an administrator. Due partially to how new these HSA accounts are, there don’t appear to be a large number of HSA Administrators available. According to the U.S. Treasury page on HSA accounts:

“Insured banks and credit unions are automatically qualified to handle HSAs. Any bank, credit union or any other entity that currently meets the IRS standards for being a trustee or custodian for an IRA or Archer Medical Savings Account (MSA) can be an HSA trustee or custodian.

If I am reading the above right, every single bank out there should be able to take my transferred HSA account from my employer upon termination / quitting / etc. I personally use E-trade as our brokerage of choice for roll-over IRA accounts, Roths, High-yield savings, etc. I looked through E-trades materials on their website and I didn’t see any mention of rolling over your HSA account to their platform. E-trade does have an insured Bank associated with the company, so I believe they should be capable if I understand it.

I found a supposedly complete list of HSA administrators here which appears to be a fairly short list. I’ve seen other short lists online as well. I’ve written to E-trade to ask their future plans, and to see if there is any reason they haven’t moved forward with offering to handle HSA accounts. I’ll be interested to know if there is a reason more institutions haven’t moved forward with this wonderful account type.

Read Full Post »