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  • Moving HSA Funds

    So, I have two HSA accounts at two different institutions.  I'm looking to consolidate (probably at Lively).  Doing a trustee-to-trustee transfer takes 2-6 weeks and, before I initiate, I would need to go to cash in my accounts--meaning the cash will not be invested for 6 weeks.  Not the end of the world, but I'd rather not have that be the case.

    The smaller of my two accounts is just in cash (womp womp, I know).

    If, rather than doing a trustee-to-trustee transfer, I simply tell the HSA custodian that I want to do a rollover (which, as I understand it, is basically a withdrawal from HSA 1, and then I have a 60-day clock to get the funds into HSA 2), is there any reason I would have to wait to get the check from HSA 1 before depositing funds in HSA 2?  Or could I simply write a check with "new" money, so that the funds are only out of the market for a couple of days?

    I know there is a once-a-year cap on this kind of rollover, so I would do the rollover for my account that has market investments and the trustee-to-trustee transfer for the account that has cash.

    Any thoughts appreciated.

  • #2
    I'm in the middle of this process right now.  Using new company's form to pull funds from old company and consolidate at new company.

    It might take a little while, but cleaner and safer to do a trustee to trustee transfer.  By happenstance I managed to cash out my old HSA right at the top of the market.  However, I finished my 2017 and 2018 Roth conversions and deployed that money and some other cash also at the top of the market.  Win some, lose some.

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    • #3




      I’m in the middle of this process right now.  Using new company’s form to pull funds from old company and consolidate at new company.

      It might take a little while, but cleaner and safer to do a trustee to trustee transfer.  By happenstance I managed to cash out my old HSA right at the top of the market.  However, I finished my 2017 and 2018 Roth conversions and deployed that money and some other cash also at the top of the market.  Win some, lose some.
      Click to expand...


      No kidding on win some lose some.  Got my end-of-year bonus at the end of December.  Funded $60k into taxable, $11k into backdoor Roth, and $6,900 into HSA in the first week of January.  About $11k into 401(k) on January 15.  Add to that the $35k that I funded into taxable November (that was my bad, just a couple of months of accumulation that should not have built up to Nov).

      But I don't expect to touch any of this for at least 10 years (and, if I'm being honest with myself, probably longer than that--retiring in 10 years from now would be lovely, but more likely I'll be shown the door in a couple of years and then have another 10-15 years of work to do after that at least!), so it all is what it is.

      I hear you on the trustee-to-trustee transfer being cleaner and safer.  I imagine I'll probably end up capitulating, even with the hit we took in the last week.

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      • #4
        To answer your question. A rollover to a destination account can not occur before the distribution date of the source of the rollover.

        However, you should not need to wait if the source custodian either allows you to make an ACH transfer to your personal account or has checks you can write on the account.

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