HSA Statistics

[xrac]

I think HSA Bank is a good option, reasonable fees and gives you the investment option if desired.

Another option is to find a local bank that has reasonable fees and interest. Develop a relationship by sending them referrals and ask about doing some joint marketing, maybe a seminar for their clients concerned about their health insurance premiums and present the HSA as a possible solution.

Two places I believe to be better options are Bancorp Bank and Health Equity. They both offer investment options and have low fees.

 

[xrac]

Agreed.

Or even better - put in the max contribution each year and DO NOT touch it , even for medical situations. When all other retirement accounts are maxed out - here is another one. Why spend money from a HSA account at all? Would you pull money from your IRA to pay a dentist bill? Only one slight flaw with this strategy... You need money.

This is the strategy I am employing. Last year I full funded our HSA but only had about $400 out of pocket that I paid with my after tax dollars. My strategy will be to save all such bills that I have paid. If I ever need cash I can remburse myself for these out of the HSA. If I never need the cash I will use it when I reach medicare age to fund a supplement or pay other out of pocket expenses. This is tax free money. Better than an IRA because IRA's require a minimum distribution after age 70 1/2 and you will pay taxes. If it is a ROTH IRA you pay taxes before you put the money in. With the HSA you never pay taxes. This is a great deal. I have about $12,000 in the HSA.

The problem with the HSA is that it is the affluent for the most part who will understand and take advantage of it. "Wealthy investors seek to build the account balance as another form of retirement savings and pay health-care expenses without tapping into the HSA," said Nancy Atkinson, a senior analyst with Aite Group LLC, a Boston-based research firm. An additional tax-advantaged retirement vehicle is very attractive to them, she added. This may mean sooner or later there will be a serious effort to repeal the HSA:

New laws may boost HSA popularity among wealthy - InvestmentNews.

 

[thereaper]

You are not required to open the HSA. Even if you open an account, you are not required to fund it.

But you cannot reimburse OOP expenses until the account is funded.

You are allowed to reimburse expenses after they are incurred, provided you have placed some money in the account prior to the expense.

I knew this I thought in the earlier post you were implying even if your deductible was met a claim wouldn't be paid unless you had the account open.

 

[retread]

... Better than an IRA because IRA's require a minimum distribution after age 70 1/2 and you will pay taxes....

Boy, did I miss this before! Are you sure the HSA is not subject to age 70 1/2 rule? If it is, it is one of its best selling points!!!

 

[NewHealthStrategies]

It's not subject to the 70.5 rules..... but is subject to the 65 years of age rule... meaning that withdrawls for Non-Medical purposes BEFORE 65 are included in income AND a 10% penalty.....

I choose to look at it this way....... after age 65.... withdrawls for Non-Med reimbursements are INCLUDED in income but NO 10% penalties apply.... pretty slick!
Of course, medical reimbursements are withdrawn tax-free regardless of when the reimbursement actually takes place.

 

[somarco]

HSA distributions.

Page 25 "

Qualified medical expense must be incurred
on or after the HSA was established.
– If HDHP coverage effective on first day of
month, HSA can be established as early as first
day of same month
– If HDHP coverage effective any day other than
first day of month, HSA cannot be established​

until first day of following month

Page 30 "

HSA Distributions can be used to
reimburse prior years’ expenses as long
as they were incurred on or after the date​

the HSA was established."

 

[retread]

It's not subject to the 70.5 rules..... but is subject to the 65 years of age rule... meaning that withdrawls for Non-Medical purposes BEFORE 65 are included in income AND a 10% penalty.....

I choose to look at it this way....... after age 65.... withdrawls for Non-Med reimbursements are INCLUDED in income but NO 10% penalties apply.... pretty slick!
Of course, medical reimbursements are withdrawn tax-free regardless of when the reimbursement actually takes place.

Just a minor point, but retirement withdrawals prior to 65 are not always subject to 10% penalty. If 59 1/2 and 72t form submitted (substantiated periodic withdrawals), 10% penalty is waived.

And yes, even though cannot contribute to HSA post 65, can use established funds to pay Medicare claims not otherwise covered.

 

[NewHealthStrategies]

So noted Mr. Retread... thank you!