If you want to open an HSA account, you might be wondering if banks charge for them. If so, you should definitely do your homework. The best way to find out is to look for reviews online and read what people who have used these banks have to say about them. You might also ask your bank if they have any tools to help you manage your accounts. Last, see if they have a list of branch locations and hours. Bankrate took a look at the fees and investment options of the top 12 HSA providers.
Health Savings Accounts can usually be opened at banks and credit unions. They will set up your HSA account with a savings or money market account. Both will make money. These are the best choices for HSA accounts because they can be turned into cash quickly. Also, you will have full control over your investment, which you might not have with a broker, who might make you work with several accounts. A local bank may also be easier to do business with than an online investment broker.
The best providers let you move money in and out of your HSA account online. Most of the time, these providers don't charge maintenance fees every month. There are a few exceptions, though. Some HSA providers will charge you a small fee to keep your account up and running. On a $3,000 account, a $5 monthly maintenance fee is the same as $6 a year in interest, which isn't much. So, you should watch out for fees and look for an account that doesn't charge a monthly fee.
You should think about opening an HSA account with a bank that doesn't charge a monthly fee to keep the account going. Northern Bank & Trust Company, for example, has a basic HSA checking account that doesn't require a minimum deposit. You don't have to open an account with a certain amount of money in it. They also have a debit Mastercard that makes it easy to get money and has a low rate of interest for balances over $25. Also, you'll be able to pay for your medical bills with your debit card.
The number of rollovers is another thing to think about. HSA rollovers are the same as HSA transfers, but you have to do something to make them happen. And you have to stay in a high-deductible health plan for at least 12 months or you'll lose the tax-free transfer. But keep in mind that you may have to re-deposit your money and pay a 10 percent penalty if you do one of these transfers.
Having an HSA account costs money, but you can also put any money you don't use in a cash-like account. This is because medical bills can pop up out of nowhere, and selling investments can lock you into losses. A better plan is to keep your HSA money in an account that works like cash. This will make it easy for you to get your money when you need it most. The main reason for having an HSA is to pay for medical expenses, not to make investments.
Fidelity Investments is one company that has an HSA account with low fees. There are no account fees or minimums to open an account at Fidelity. Fidelity does not charge for its debit card services or online investment platform, which is different from most banks. It's easy to set up an account and keep it in good shape. Fidelity is a good choice for many investors, no matter what kind of account they have.
HSA accounts are member-owned accounts that get tax breaks. There is no tax on using them to pay for medical bills. Mutual fund investments are tax-free. HSAs can help you save thousands of dollars each year if you have a qualified health plan. You can even move your HSA to a new provider without having to pay taxes on the money you've made. Before opening an HSA account, make sure you know the rules if you want to switch HSA providers.
HSAs can also have fees charged by banks. The self-directed brokerage account from TD Ameritrade has no fees, while the guided portfolio from Devenir costs 0.5 percent per year. But compared to what you could earn from an HSA account, these fees are small. Some banks even offer free HSA accounts. And if you don't have enough money to open one, choose a bank with lower fees.