Contributing to an HSA
Contributing to an HSA
I have been contributing to a HSA the last couple years, and it's been fine. My work contributes $1800 over the year and it hasn't really been a problem at all.
Now I have a kid and a spouse on my insurance, and they tend to go fairly often it seems. The copay and deductible on the HDHP is a bit crazy and I'm thinking of swapping to a PPO. Is that a good idea, or is turning down the free $1800 from my work a no no?
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If you do switch, note that the usual is that it stays as an HSA card but since it’s not being actively contributed to, you get charged a small amount (usually $1/mo) for “account maintenance”. You can continue to use it for all medical purposes, including paying for all copays and deductibles and medicines etc. as usual.
Depends on where you have your HSA. No one is forcing you to leave your HSA $$ at your employer's HSA provider, and in fact you can maintain multiple HSA accounts if you like. The main catch is that you'll want to keep the tax advantages for contributions into an HSA so initially you should still use the employer's HSA provider for that (to get that payroll deduction + employer match if they offer it).
e.g. my employer's HSA provider's investment options aren't great so I only leave a small amount there & transfer the rest of my collected HSA $ into a Fidelity HSA account. Fidelity does not charge account maintenance fees AFAIK.
EDIT: For OP if they no longer want to use their employer's HSA, & they've stopped contributing to it, they may as well transfer the entire balance over to Fidelity or some other HSA provider with $0 fees & invest there. It'll be similar to maintaining an IRA account.
Funny you should say that, since Fidelity is the one charging me fees after I left my employer. Thanks for sharing that we can move money between HSAs. I might look into that at some point in the future. In general though, I find it despicable that healthcare money is also pushed as an “investment vehicle”. If and when the market tanks, HSAs tank with them, right? What a fucked up thing to do, USA.
Funny you should say that, since Fidelity is the one charging me fees after I left my employer.
Interesting, good point. That can indeed happen if the HSA account itself was opened via your employer (sounds like yours was). Individual HSA accounts at Fidelity don't have fees (accounts opened there directly without employer involvement). Maybe it's worth asking Fidelity if you can open your own individual HSA account there to then transfer your old HSA funds into it. Otherwise perhaps an individual HSA account elsewhere may do the trick.
https://www.fidelity.com/go/hsa/why-hsa
I find it despicable that healthcare money is also pushed as an “investment vehicle”. If and when the market tanks, HSAs tank with them, right?
Indeed, though I guess if you wanted to avoid that you could just leave the investments in money market funds or similar low risk investments. Or just don't invest the money at all. But then people won't be motivated to save money into an HSA to begin with. I suspect the whole point is to motivate people into putting money into the HSA since they'll have to pay more and more health insurance out-of-pocket now and in coming years. It's the American way! :P
Good point, I hadn't considered rolling over. I'd like to get away from Kaiser, but my HDHP option with Anthem is 20% after the deductible. So I guess it will with be PPO or stick with Kaiser -_-