Fidelity now has individual HSAs

Is Fidelity now considered the best HSA provider? Looks like there are still no fees.

Do account holders get access to Fidelity’s full range of funds or do you only get access to a subset of funds (w/ presumably higher expense ratios)?

Fidelity has been the best since they came out with it. You can buy anything in the HSA, including the “Zero” funds.

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Great! Thanks _TJ!

is there a way to transfer from Optum, if still employed or just rollovers?

If not what’s the best Optum investment option?

I don’t use Optum, but I think some on Bogleheads have mentioned doing this.

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I’m not sure of your question. “Still employed” does not exclude rollovers.
"̶G̶i̶v̶e̶ ̶m̶e̶ ̶a̶ ̶p̶i̶n̶g̶,̶ ̶V̶a̶s̶i̶l̶i̶.̶ ̶O̶n̶e̶ ̶p̶i̶n̶g̶ ̶o̶n̶l̶y̶,̶ ̶p̶l̶e̶a̶s̶e̶.̶"̶ Just one rollover per year is allowed, even if the account/employer remains the same. I hated Optum, and was happy to gut my account to $0 each year.

If the above doesn’t make sense, especially due to my Red October reference (at least it is now topical), ask away. :smile:

Just one rollover per year is allowed

What does this restriction apply to? Does Fidelity only allow one rollover into their HSA per year? Does Optum only allow one rollover out of their HSA per year? Is the restriction one rollover per year for each “Source HSA” → “Target HSA” pairing?
I ask because I have multiple HSAs that I’d like to roll into Fidelity and hope I’m not restricted to only rolling one HSA per year into Fidelity.

As far as I understand the rules for HSAs, once it’s on your employer-sponsored HSA, you can rollover the funds any time you want via Trustee-to-Trustee Transfer and it’s not subject to the one-time per year limit (only the check-based rollover is limited to once per year as far as I’ve read). The only issue is I think some HSA providers may charge nominal fees to do the rollovers.

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I believe it’s an IRS regulation. Direct Transfer is not considered a rollover though as mentioned.

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I love Sean Connery!

I just started my 1st HSA at Optum and have spending down the contributions toward my deductible. Hopefully will have enough built up later in the year to transfer if I don’t like Optum options/fees soon

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Only you know your own circumstances. But it’s generally accepted that the best HSA strategy is to pay med bills out of pocket, keep the receipts, then submit them to the HSA for reimbursement when you are really really old (or just draw out the funds using current bills at that time). The gains in the HSA accumulate tax free, so you want to put as much as you can into it and leave it there as long as possible.

This stratgey only gets stronger with HSA option like this Fidelity account, which gives you access to most of the things you might choose to invest your non-advantaged money in anyways. So spend the non-advantaged money, and keep your HSA balance growing.

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good strategy. It’s my 1st time w/ HSA and I equated it to FSA.So there’s no time limit to when you can submit them to HSA for reimbursement?

I guess I’ll get CC points that way too!

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Correct. As long as those expenses were not reimbursed by insurance or distributions from another source (such as a FSA), there is no time limit on when to get reimbursed. You just need to be really good at keeping record of them in case you’re audited.

One caveat not often mentioned is that you cannot get reimbursed for the medical expenses for which you took a tax deduction. Since those are subject to the 7.5% of AGI threshold, it’s not often claimed but basically you cannot double-dip that way.

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Perfect thanks. Looks like HSAs are much better than FSAs. Until now I’ve avoided them due to the HDHP requirement, but our traditional insurance was getting to have too high deductible so I thought we should try HDHP this year.

https://www.cnbc.com/2022/03/07/more-than-1-billion-could-be-forfeited-in-health-care-fsas-this-year.html

Yes, you are correct. I’ve never had to deal with more than one transfer per year, so wasn’t aware of unlimited trustee-to-trustee transfers.

All HSA providers that I’ve dealt with charge $25 for trustee-to-trustee transfers. The only other advantage of rollovers via check is that you’ve got 60 days before the money has to be in the receiving providers hands.

I can’t remember exactly what it was (maybe I’m mixing it up with IRAs) but I thought there was something about rollover via checks where the custodians had to withhold tax just in case you did not put the money back in on time. That seemed to be one advantage of the direct trustee-to-trustee transfer. They don’t have to withhold tax you’d owe if you did not put money back in within 60 days because it never gets to the account holder.

But yeah that $25 fee seems on par with what I’ve read (I’ve never done one since my employer HSA is at Fidelity to start with). The fee itself would make it worth not doing the rollover too often even though you could.

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Negative on HSA’s. I do it, and have done it annually for about 10 years. No HSA provider has withheld any taxes. The idea does ring a bell, but I’ve never done an IRA transfer via check, so can’t confirm it.

Are there any ways to get out of Health Equity’s $25 account closure fee? I know with other HSAs (e.g., Optum Financial) that if you close an HSA w/ zero balance they won’t charge you the closing fee. Thus if you transfer/spend all the money before closing the HSA you can avoid the closure fee. I’m hoping there is also trick to avoid Health Equity’s $25 account closure fee as well.

If there is no way out of Health Equity’s $25 account closure fee is there a way to at least pay the fee w/o withdrawing from your HSA’s balance?

I went with the “I’ll send my last $25 to my dentist” methodology to screw those high fee Healthequity bastards.

I had previously transferred all my money to my Fidelity HSA, leaving only $25 in the HE account.

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I don’t have access to the correct machine to confirm this, but am pretty sure that we just closed a “myhealthequity.com” account in early February. We took a check for the entire balance (which was promptly rolled over to our Fidelity HSA). With a remaining balance of $0, I called to close the account. The subject of a “closing fee” was never broached. I do not expect to ever hear from them again, but am prepared with the recorded call, if they do.

If it’s not clear from the above, I suggest draining the account, and closing it after the final check clears. If they want a closing fee, just leave it open, as there are no minimums to keep it open. If the CSR has any sense, she will understand the economics, and let you close it.

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