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Best HSA custodian / broker for investing?

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  • Best HSA custodian / broker for investing?

    I'm looking into different HSA custodians primarily for long-term growth investing. I think most are comparable for medical expenses.

    WCI recommended Health Savings Administrators, but curious if you all thought that was a dated recommendation? They are charging 0.25% in addition to $45 but have good access to Vanguard funds

    Others that seem worth looking into:

    HSA Bank works out to about $66 per year and has access to TD Ameritrade no fee ETFs

    Saturna Capital has no admin costs if you make one trade a year

    SelectAccount costs $30/yr + Schwab trades if you use their lowest option but needs 10k to invest

    Elements HSA supposedly low cost with Ameritrade but I don't see their fees published.


    Do you have one that you'd recommend? What is your ranking of HSA providers for investment?

  • #2
    I just did a bunch of research on this because I started a HSA last year. I ended up going with Elements. Harry Sit (aka "the finance buff") has a couple nice articles about this on his blog I suggest you check out and that was ultimately his recommendation as well. For me, Elements has worked out great. They do charge a "wire transfer fee" of $25 (was $24 in 2015) to move your money from your account with them to a td ameritrade account affiliated with your HSA. I have fully funded mine for the year at one time so this was a one time fee per year for me. I was mostly interested in using my HSA as a Stealth Ira as suggested by WCI so the commission free ETFs available through TD ameritrade give me access to all the funds I want/need. Mine is invested in the vanguard funds VTI and VB. I think there is a $3 monthly fee if your savings account (which you are required to open when you open a HSA) balance drops <$3000. I just use this savings account to hold the money I will owe for quarterly taxes so I am not being subjected to this fee and deposit money into it using their app. You could just park $3k in it as well if you wanted. If you did that, your only yearly fee is $25 (the wire transfer fee). Their customer service people were very helpful over the phone helping me set things up. My buddy does his through HSA Bank and has been very happy with them as well. One additional benefit for me personally was that I live in Indianapolis so elements has a branch within driving distance (although I have never had the need to physically go there). Hope this helps!


    • #3
      I went with HSA bank (just started this year) because of the relatively low fees, but mostly because of the wide availability to basically invest in anything with TD ameritrade. That isnt my brokerage and Im also excited to use some of their tools as theyre supposed to be pretty nice. I only have it as a stealth IRA tax savings vehicle.


      • #4
        If that's the case for Elements, $25 isn't bad but the real cost includes the $3 a month because of the cost of keeping $3000 in cash. Is it definitely the savings account, or the savings + investment combined?

        HSA and Elements would have access to the same investments via TD Ameritrade I take it.

        Zaphod, did you consider SelectAccount? The minimum there is 10,000 so perhaps a better place to rollover later?


        • #5
          I went with Wells Fargo.  They use their own funds, so there is a higher ER than Vanguard (although I just checked and it looks like the index fund option is only 0.25%).  However, I like: 1) the simplicity of having it linked to my other accounts (logging in, depositing money, seeing balance); 2) They waive extra fees once you have enough money invested with them; 3) They keep only $2k in cash.  In the past, when I actually used the account, it was easy to reimburse myself for healthcare expenses--now I just use post-tax dollars and let the HSA ride!


          • #6
            No, since this is my first year and didnt have that amount, but it is definitely an option after year 2. I really chose that because of the freedom in the account. I have zero intent to ever touch this for decades so I wouldnt use any option that wasnt putting the whole thing to work. Now I have to go make sure there isnt any cash minimum.


            • #7
              You can find a good comparison of features here. From the ratings, offerings, and costs listed, you might want to put SelectAccount on your short list. The HSA Authority is well rated with no mo. charge.
              My passion is protecting clients and others from predatory and ignorant advisors 270-247-6087 for CPA clients (we are Flat Fee for both CPA & Fee-Only Financial Planning)
              Johanna Fox, CPA, CFP is affiliated with Wrenne Financial for financial planning clients


              • #8
                I thought I read recently that HSA bank had dialed back their fees. Still charge $30 ($2.50/mo) if don't keep $5000 in savings acct with them but no other fees except $25 account closing fee. If this is up to date and get commission free Vanguard ETF trades, they win in my book.


                • #9
                  My company offers Health Equity, they allow access to a number of low cost Vanguard funds for an extra fee of 0.003% per month.  Since my monthly account fees are covered by my employer this ends up being worth it for me.  I pay about $60 a year in fees on $12K invested in addition to the underlying (low) ER of the funds.