Author Topic: Is there a MMM HSAs for dummies here?  (Read 10110 times)

HSLmom

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Is there a MMM HSAs for dummies here?
« on: April 11, 2014, 06:00:05 PM »
I never was excited about investing until I found MMM :) I just set up a HSA at my local bank, but realized it's super low % (0.1% I think), so I'm assuming you guys have yours elsewhere?

I'm looking up https://hsaadministrators.info/vanguard-funds-list - I really don't know much. I have mutual fund accounts for my kids through USAA in 'aggressive growth', but I don't know what would be appropriate for an HSA acct. 

I'm investing the family max, saving receipts, but planning on leaving it alone and dealing with medical costs out of pocket.

You guys are super inspiring!

Edit: I'm 30, single mom, 3 kids
« Last Edit: April 11, 2014, 06:02:09 PM by HSLmom »

arebelspy

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Re: Is there a MMM HSAs for dummies here?
« Reply #1 on: April 11, 2014, 08:50:04 PM »
My favorite HSA article is this: http://www.madfientist.com/ultimate-retirement-account/

However, I'm not sure what questions you have, so I don't know what sort of links to guide you to.

Why would your HSA have any different AA than your normal portfolio?
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HSLmom

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Re: Is there a MMM HSAs for dummies here?
« Reply #2 on: April 11, 2014, 09:11:52 PM »
The HSA is my first investment other than the mutual funds I have for my kids (USAA set those up for me, so I didn't really learn much in the process), so I really don't know about portfolios at all, or if the HSA was supposed to be different.

I'll read the article, thanks!

Edit- Yeah, that was the article that convinced me I needed a HSA.  I was thinking when I went to the bank they'd let me pick what to put it in, but they just put it in a regular savings account.  I'm not really sure what to do from here- let it grow and then transfer to Vangaurd?

It looks like I also need to learn more about portfolios. I don't have anything to invest other than the HSA, I'm paying down to get rid of PMI on my house for the next couple years.
« Last Edit: April 11, 2014, 09:14:20 PM by HSLmom »

MayDay

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Re: Is there a MMM HSAs for dummies here?
« Reply #3 on: April 18, 2014, 09:58:55 AM »
Ours is with Fidelity as it is the only choice through an employer (although it's a good choice so I am not complaining). I think it's invested in a total market index fund.  We initially just had the money in a regular savings account through Fidelity, until we got about 5k built up.

GregO

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Re: Is there a MMM HSAs for dummies here?
« Reply #4 on: April 18, 2014, 10:34:12 AM »
I was thinking when I went to the bank they'd let me pick what to put it in, but they just put it in a regular savings account.  I'm not really sure what to do from here- let it grow and then transfer to Vangaurd?

First off, if you have your healthcare through your employer, it's best if your employer can deduct the money from your paycheck pre-tax.  If so, you don't have to pay Social Security deductions on the money.  But if you don't have that option, then you can open the HSA with whoever you want. 

HSAs are very confusing, there's a million options out there.  Some of them (like your bank) only allow you to put money into a savings account.  Others allow you to invest the money in the stock market, usually through a "brokerage window".  And they ALL charge different fees.  So if you want to invest your money in Vanguard funds, you are going to have to open an HSA with someone that offers that option (like HSAadministrators.com that you linked).  And you are also going to have to pay attention to the fees that they charge.

From my research, the best one I found was Eli Lily Federal Credit Union (http://www.elfcu.org/solutions/deposits/health-savings-account/).  They have no fees, offer 1% on money in the savings account, and also offer a brokerage window that can invest in ETF index funds.  To compare, HSA Administrators charges a $45 fee annually, as well as 80 cents for every $1000 you have invested (https://hsaadministrators.info/hsa-fees).  So you'll have to find one that you like (low fees and investment options).
« Last Edit: April 18, 2014, 10:37:30 AM by GregO »

HSLmom

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Re: Is there a MMM HSAs for dummies here?
« Reply #5 on: April 19, 2014, 07:46:59 AM »
Thanks, that's really helpful!  I'm self employed, so I can take it out pre-tax and invest wherever I want, so that's a plus also :) I'll be on the lookout for fees and I'll check out that credit union. For now I'll just build up my savings account so I max out the HSA for the year, I can move it later.

ender

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Re: Is there a MMM HSAs for dummies here?
« Reply #6 on: April 19, 2014, 08:09:43 AM »
Ours is with Fidelity as it is the only choice through an employer (although it's a good choice so I am not complaining). I think it's invested in a total market index fund.  We initially just had the money in a regular savings account through Fidelity, until we got about 5k built up.

This is my situation too - though I've not yet got the $5k built up :)

GGNoob

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Re: Is there a MMM HSAs for dummies here?
« Reply #7 on: July 25, 2014, 07:40:49 AM »
I never was excited about investing until I found MMM :) I just set up a HSA at my local bank, but realized it's super low % (0.1% I think), so I'm assuming you guys have yours elsewhere?

I'm looking up https://hsaadministrators.info/vanguard-funds-list - I really don't know much. I have mutual fund accounts for my kids through USAA in 'aggressive growth', but I don't know what would be appropriate for an HSA acct. 

I'm investing the family max, saving receipts, but planning on leaving it alone and dealing with medical costs out of pocket.

You guys are super inspiring!

Edit: I'm 30, single mom, 3 kids

I just discovered that my wife was eligible for an HSA late last year. After doing my research, I opened an account at Health Savings Administrators (hsaadministrators.info). I too am just saving receipts (physical and digitally scanned) and paying out of pocket because I want it to build up as long as possible before I withdraw any money. So since I have a long term goal, I'm investing in a Total Stock Index Fund, Total International Stock Index Fund, and Total US Bond Index Fund to do a 90% stock and 10% bond portfolio (45% US Stock, 45% International, 10% US bond).

I wish there wasn't so much paperwork involved with getting this HSA set up (why can't everything just be done online these days?). But once we got the account set up, our bank account linked for withdrawals, and automatic contributions set up, it's been easy to manage. Any reimbursements can now easily be done online if needed. Updating your future allocation and current funds can also easily be done online. So now that its all set up, I really like the account and would recommend it to you.

slug22

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Re: Is there a MMM HSAs for dummies here?
« Reply #8 on: July 25, 2014, 03:05:58 PM »
I just registered for MMM just so I could reply to this thread. I spent about 2 months researching HSA options because everything was so confusing and I felt a bit overwhelmed. After looking at all of the options I finally chose Bank of America, who I know is probably not a popular institution around here. It was the simplest option that had all my criteria: online registration, deposits, tracking, Vanguard index funds. I really liked how straightforward investing was compared to the others. They charge $4.50 per month and you are free to invest all but $1000 that needs to be kept in as minimum in the non-invested portion. I figured with investing the full amount our family is qualified for $6550 my investments are sure to make up for the monthly fee. I plan to use this as a second-tier emergency fund that I will tap in by saving all my medical receipts. Otherwise it will continue to grow and be reinvested. I also liked that it offered Vangaurd TIPS fund which is another way for me to save on taxes since California still taxes on HSA's but not on TIPS. Hope this info can help others!
Leslie

milesdividendmd

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Is there a MMM HSAs for dummies here?
« Reply #9 on: July 25, 2014, 03:32:02 PM »
I believe this to be the best write up of HSA providers.

http://whitecoatinvestor.com/choosing-an-hsa-provider/

I have HSA bank and love it, but if you don't park 4-5k in their savings Account, you will have to pay $5.50/month in fees.

Here are my articles on HSA's, and HSA portability if that helps...

http://www.milesdividendmd.com/portable-bliss/

http://www.milesdividendmd.com/stealthy-healthy-wealth/

Good luck.
« Last Edit: July 25, 2014, 03:42:34 PM by milesdividendmd »

dodojojo

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Re: Is there a MMM HSAs for dummies here?
« Reply #10 on: July 25, 2014, 03:44:58 PM »
I have about 10 more days to decide if I want to go with a HSA at my new job.  I know there are favorable tax breaks for me, but somehow I can't get over the fees and restrictions of the HSA administrator.  My company uses Optum Bank and the two things that chap my hide are that I have to keep a minimum of $2,000 in the savings account and if the account is less than $5,000, I pay a monthly fee of $3.  The savings account pays something like .15% interest on 2K.

Running the numbers, the fees are still smaller than the tax gains I will make this year.  Of course, it will also help if I do not incur too many medical expense or none at all.  I don't know how to calculate what the pros and cons are in the long term.  I mean keeping 2-5K in an account that literally almost pays nothing for years can't be good.


Richie Poor

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Re: Is there a MMM HSAs for dummies here?
« Reply #11 on: July 25, 2014, 03:54:23 PM »
Since I don't need it for medical bills I invested pretty aggressively in higher risk funds. The timing was lucky and my account is worth 24K despite contributing only 15K. I invested in VIMAX (mid cap fund) but recently switched it all to VTSAX.

If you ever think you might need that money for medical bills I would suggest going with a more conservative fund.

HSA administrators has been pretty hassle free for me since I'm self-employed. I send one check a year for the contribution and one check a year for the $40 admin fee. HSA administrators were the only vanguard option years ago for me but if there are other options with lower fees now that would be interesting.

milesdividendmd

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Is there a MMM HSAs for dummies here?
« Reply #12 on: July 25, 2014, 05:08:53 PM »
I have about 10 more days to decide if I want to go with a HSA at my new job.  I know there are favorable tax breaks for me, but somehow I can't get over the fees and restrictions of the HSA administrator.  My company uses Optum Bank and the two things that chap my hide are that I have to keep a minimum of $2,000 in the savings account and if the account is less than $5,000, I pay a monthly fee of $3.  The savings account pays something like .15% interest on 2K.

Running the numbers, the fees are still smaller than the tax gains I will make this year.  Of course, it will also help if I do not incur too many medical expense or none at all.  I don't know how to calculate what the pros and cons are in the long term.  I mean keeping 2-5K in an account that literally almost pays nothing for years can't be good.

As per my above link "portable bliss" you can usually transfer your HSA funds out of your crappy HSA and into a good one.

I transferred mine from health equity to HSA bank. I just had to leave 25$ in my old account.

You should absolutely call optima bank and get the skinny.
« Last Edit: July 25, 2014, 05:35:29 PM by milesdividendmd »

Scandium

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Re: Is there a MMM HSAs for dummies here?
« Reply #13 on: August 04, 2014, 09:48:33 AM »
My favorite HSA article is this: http://www.madfientist.com/ultimate-retirement-account/

However, I'm not sure what questions you have, so I don't know what sort of links to guide you to.

Why would your HSA have any different AA than your normal portfolio?
My wife has an HSA, but since it only offers a savings account with 0.10% interest I don't really agree with fientiest that it's the "ultimate retirement account". Maybe if you actually have decent choices.. We see no reason for her to add any more than what her employer contributes.

milesdividendmd

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Is there a MMM HSAs for dummies here?
« Reply #14 on: August 04, 2014, 10:58:46 AM »
My favorite HSA article is this: http://www.madfientist.com/ultimate-retirement-account/

However, I'm not sure what questions you have, so I don't know what sort of links to guide you to.

Why would your HSA have any different AA than your normal portfolio?
My wife has an HSA, but since it only offers a savings account with 0.10% interest I don't really agree with fientiest that it's the "ultimate retirement account". Maybe if you actually have decent choices.. We see no reason for her to add any more than what her employer contributes.

Why not max it out and transfer the HSA to another provider?  (repeat link for ease of navigation.)

http://www.milesdividendmd.com/portable-bliss/

This is exactly what I did and I couldn't be happier.

If you have contacted her HSA provider and were unable to roll it over, I would love to hear about it.  I have yet to hear of such a case.
« Last Edit: August 04, 2014, 11:04:44 AM by milesdividendmd »

Scandium

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Re: Is there a MMM HSAs for dummies here?
« Reply #15 on: August 05, 2014, 07:56:23 AM »
My favorite HSA article is this: http://www.madfientist.com/ultimate-retirement-account/

However, I'm not sure what questions you have, so I don't know what sort of links to guide you to.

Why would your HSA have any different AA than your normal portfolio?
My wife has an HSA, but since it only offers a savings account with 0.10% interest I don't really agree with fientiest that it's the "ultimate retirement account". Maybe if you actually have decent choices.. We see no reason for her to add any more than what her employer contributes.

Why not max it out and transfer the HSA to another provider?  (repeat link for ease of navigation.)

http://www.milesdividendmd.com/portable-bliss/

This is exactly what I did and I couldn't be happier.

If you have contacted her HSA provider and were unable to roll it over, I would love to hear about it.  I have yet to hear of such a case.
I didn't know you could do that, thought we were stuck with her crappy bank plan. Maybe I'll look into changing providers. But since we don't really have medical expenses and we're not maxing 401ks yet I'm not really in a hurry at the moment. Maybe down the road. 
Thanks

milesdividendmd

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Re: Is there a MMM HSAs for dummies here?
« Reply #16 on: August 05, 2014, 12:37:04 PM »
By all means you should max out you 401K, but not having medical expenses is not a problem.  It is an asset! 

In fact even if you do have medical expenses, if you can afford it, the smart play is to pay for the medical expenses out of pocket and allow the HSA account to compound indefinitely.

This is how an HSA becomes a "stealth IRA."