As long as they use health equity, you will have to keep that account open. You can open an HSA elsewhere and do transfers over. You want you contributions to go to health equity initially to get the full tax benefit. Then periodically make transfers. Just be aware of fees to do so.

The gain/loss is under the ‘Current Investment Balance’ total in the Investments tab. And the total cost basis should be under the Transaction History of whatever your fund is under the Portfolio tab.

I have a HSA account with Fidelity, it is free meaning no monthly fee no matter the balance.

Once a year, I go to the Fidelity site and initiate a “trustee to trustee” HSA transfer.

Fidelity takes my signed forms, mails them to Health Equity (my employers preferred HSA bank), Health Equity sends Fidelity my money, and I invest in index funds and individual stocks on Fidelity. There are no fees involved in this process.

Every time I switch employers, I do the same transfer into Fidelity. Be aware to leave $25 when doing that final transfer because Health Equity and other HSA banks charge about that much of a fee if you take all of your money out (meaning you are closing the account).

Instead, transfer everything except $25 and then go buy HSA approved OTC medicine and other stuff you may need and pay with the HSA debit card.

Yes they are terrible. My previous HSA was sold or something there and I transferred it to Fidelity. Was painless, just provide info to fidelity. Unfortunately you can't do that until you leave your employer.

Those two numbers are the same... isnt total cost basis = the entire amount of money I put? What's under transaction history is exactly same as what's under current investment

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You can move your funds to any scheme operator you want. If your employer is shifting some of its excess payroll funds into the product rather than putting those funds into your wages, it's under no obligation to keep doing that via the scheme operator you choose if you choose a scheme operator other than the one your employer chose.

Not for a HSA. With HSA’s, there is no vesting period for your employer match. The instant your employer puts the match into your HSA, it is 100% yours to spend, invest, or transfer out to your personal HSA.

A HSA is literally a bank account (Health Savings Account) you owe and the money is not in the control on your employer.

Thanks for the excellent, detailed post. I'm going to do this asap.

Question about hsa contributions. Is there any advantage/disadvantage to maxing out your hsa with a single paycheck vs having it maxed out with payments throughout the year?

You can do it anytime, I transfer to fidelity every 6 months.

You’re welcome! There are no advantages of maxing it all at once other than “you can invest your money into the market quicker so your money spends more time invested”.

With a HSA, your employer match does not depend on your contribution meaning you always receive the match whether you contribute or not, so that is not an issue here.

I would advise to contribute to your HSA on a normal per paycheck schedule in case you leave your employer mid-year and decide not to go with a HSA plan with your new employer, this may cause pro-rated contribution issues and having to take some contributions out and stuff.

I do it per paycheck so my paychecks are consistent. That's it.

Just make sure to do it through payroll instead of as a separate contribution because you can only avoid FICA taxes if you do it through payroll.

Health Equity kinda sucks, but as others have mentioned, you can do a trustee to trustee transfer at any point.

If they charge a fee, you can instead do a yearly (rolling 365-day period, not calendar year) indirect rollover where you withdraw money like you would if you're reimbursing yourself, and then deposit into your new HSA. If they give you checks, just send a check with a form to Fidelity . Either way, make sure to tick the rollover checkbox so it doesn't get coded as a contribution. You need to complete the transfer within 60 days or it'll be considered a withdrawal instead.

I now have Optum Bank which sucks in many similar ways, and I do regular transfers and haven't had any issues for ~2 years now, so it should work fine for pretty much any HSA. Just pay attention to fees in case your HSA assesses one.

Another less likely option is to ask your payroll department if you can just have your contributions to straight to your new HSA. Some employers allow it, some don't.

Also once you leave your employer, health equity fees are absolutely absurd. I think I was paying more in fees for my tiny HSA than for my 401k.

Not sure if everyone has the same fund lineup at Health Equity or not, but they can't even properly identify if the funds they offer are actively or passively managed. They have always shown the Vanguard Target Funds as actively managed. They used to list all Vanguard funds as passively managed even though they sold the Vanguard Wellesley Fund, which is definitely actively managed.

I could never figure out their corporate structure enough to know which entity to report and what agency to report them to. I don't think it rises to the level of fraudulently misrepresenting securities, but it must be close.