Each month Devenir highlights a selection of articles to keep you abreast of the latest trends and developments in the HSA marketplace.
A summary of the articles included in the August 2017 edition:
- Powell: Best Ways to Save Money With a Health Savings Account
- The Real Cost Of HSA Investment Fees
- Trends in Health Savings Account Balances, Contributions, Distributions, and Investments, 2011-2016: Statistics from the EBRI HSA Database
- Health Savings Accounts Becoming The New IRAs
- HealthEquity Enters Partnership to Serve First Interstate Bank’s HSA Members
Powell: Best Ways to Save Money With a Health Savings Account
Most Americans use their HSA for current health care expenses, rather than long term health care expenses. Knowing how to make your HSA work best for you includes understanding where and how to invest your money to save for current or future medical expenses.
Trends in Health Savings Account Balances, Contributions, Distributions, and Investments, 2011-2016: Statistics from the EBRI HSA Database
The Employee Benefit Research Institute (EBRI)’s recent Issue Brief finds that the average account holder is using their HSA as a specialized checking account to cover current expenses rather than an investment vehicle. However, average-year end balances and contributions are higher for accounts that have been open longer. “Over time, account owners appear to see the value in investing. In 2016, 11 percent of accounts opened in 2005 had investments other than cash, compared to only 1 percent among those opened in 2016.”
Health Savings Accounts Becoming The New IRAs
As HSA balances continue to grow so to have the percentage of HSA assets being invested. That trend is expected to continue as more consumers realize the unique tax advantages of HSAs. “It’s a budding industry with lots of potential for growth,” says Heather Larsen of Morningstar, Inc., “A lot of people view them as a health-care spending vehicle, but they are also great tax-management vehicles.”
HealthEquity Enters Partnership to Serve First Interstate Bank’s HSA Members
HealthEquity has entered into a partnership with First Interstate BancSystem Inc., and will become the custodian for all First Interstate HSA business, by September 28, 2017. This transaction will include between 10,000 to 15,000 HSAs totaling between $50 to $60 million in custodial assets.