Hello, everyone. It’s Todd Furniss, author of The 60% Solution: Rethinking Healthcare. Are you looking for a way to save money on healthcare expenses? Health Savings Accounts (HSAs) may be the solution you need. HSAs are tax-advantaged accounts that allow you to save money for healthcare expenses, such as deductibles, copayments, and prescriptions. Many find it valuable to compare and contrast HSAs so here is a breakdown of selected HSAs offered by three companies: Fidelity, Optum, and PNC, to help you determine which one is right for you.
HSAs by Fidelity
Fidelity is an American financial services corporation that operates as a brokerage firm that manages mutual funds and provides investment advice, retirement services, wealth management, life insurance, and more. Among their offerings are HSAs.
Pros
- No monthly fees or minimum balance requirements: Unlike some other HSAs, Fidelity’s HSA does not charge any monthly fees, and there is no minimum balance requirement to maintain the account.
- No fees for withdrawing funds: Fidelity does not charge any fees for withdrawing funds from your HSA account, which can be beneficial if you need to use your HSA funds to pay for medical expenses.
- Easy to use: Fidelity’s HSA is user-friendly, with online management tools and a mobile app available for account management.
- Several investment options: Fidelity’s HSA offers several investment options, allowing you to grow your HSA funds over time.
Cons:
- Minimum initial investment requirement: Fidelity’s HSA requires a minimum initial investment of $2,500 to invest in mutual funds. This may be a barrier for some individuals who are just getting started with their HSA and may not have that much to invest.
- Limited investment options: While Fidelity does offer several investment options for its HSA, they may be more limited compared to other financial institutions.
- No cash incentives: Unlike some other HSAs, Fidelity does not offer any cash incentives for opening a new HSA account.
While Fidelity’s HSA offer does not impose monthly fees, withdrawal fees, and a variety of investment options, the initial requirement of $2,500 for mutual funds investment may limit access versus other institutions. Consult your financial advisor for more information.
HSAs from Optum Bank
Optum Bank is an American healthcare service provider that provides Health Savings Account (HSA) options to its customers. Optum’s HSA offers several benefits, as well as a few drawbacks.
Pros
- No monthly fees or minimum balance requirements: Optum does not charge any monthly maintenance fees, and there is no minimum balance requirement to keep the account open.
- No transaction fees: Optum does not charge any fees for transactions, such as withdrawals or transfers.
- Investment options: Optum offers a variety of investment options, including mutual funds and exchange-traded funds (ETFs), which can help account holders grow their savings over time.
- Online tools and resources: Optum provides a range of online tools and resources, including an HSA calculator and a mobile app, which can help account holders manage their accounts easily.
- Further health savings account (FHSA) feature: Optum’s FHSA feature allows account holders to invest a portion of their HSA funds in a separate investment account that offers more investment options.
Cons
- FHSA minimum balance requirement: The FHSA feature has a minimum balance requirement of $2,000, which may be a barrier for some account holders.
- Limited customer support: Some account holders have reported difficulty reaching Optum’s customer support team, which can be frustrating when trying to resolve account issues.
- Limited geographic availability: Optum’s HSA may not be available in all states, which can limit its accessibility for some potential customers.
Overall, Optum’s HSA offers many benefits, including no fees and a variety of investment options. However, the FHSA feature may not be suitable for all account holders, and the limited customer support and geographic availability may be drawbacks for some. Consult your financial advisor for more information.
HSAs Provided by PNC
PNC Financial Services Group is an American bank holding and financial services corporation. PNC offers a wider range of investment options than the Fidelity and Optum HSAs. However, there are higher fees associated with some of these investment options, so it’s essential to do your research before investing. PNC also offers a cash incentive for opening a new account, with up to $200 cashback available.
Pros
- No monthly fees or minimum balance requirements, making it accessible to a wide range of individuals.
- No fees for withdrawing funds, allowing individuals to use their HSA funds as needed for qualified medical expenses.
- Offers a wider range of investment options compared to Fidelity and Optum, which may be beneficial for those interested in more diverse investment options.
- Provides tools and resources to help manage HSA accounts, including an HSA calculator and a mobile app.
- Offers a cash incentive of up to $200 for opening a new account, which can be a nice bonus for individuals starting an HSA.
Cons
- Some of the investment options may have higher fees associated with them, so it’s essential to do your research before investing.
- The account may not be as accessible to those with lower incomes or those who may not have as much money to invest, as the minimum initial investment may be a barrier for some individuals.
- The FHSA feature, which allows for investing in higher-risk investments, is unavailable with PNC’s HSA.
Overall, PNC’s HSA may be a good option for individuals looking for a wider range of investment options and are comfortable with potentially higher fees associated with some of these options. It may not be the best option for those just starting with an HSA or for those who may not have as much money to invest initially.
When choosing an HSA, it’s important to consider factors like fees, investment options, account management tools, and customer support. You want to make sure that managing your HSA is convenient and stress-free. It’s also important to choose an HSA that meets your unique needs and goals, based on factors like your age, health status, family size, and expected healthcare expenses.
HSAs are a great way to save money on healthcare expenses, and there are many options available from companies like Fidelity, Optum, and PNC. Take the time to research your options and choose the HSA that best meets your needs and financial goals. With the right HSA, you can take control of your healthcare expenses and enjoy greater financial security and peace of mind. For more information, visit the websites of Fidelity, Optum, and PNC.