Criteria for Evaluating HSA Plans
as an Investment Vehicle
In evaluating the best investment HSAs, we focused primarily on fees, investments, investment thresholds, and investor-friendly features.
Fees
When you open an HSA, you are subject to a long list of potential fees. However, in this study we concentrate on the fees investor’s are most likely to encounter:
Maintenance / Administrative
Investment
Custodial (asset based fees)
Commissions
The best investment HSAs:
have transparent fee disclosures.
have low maintenance fees (less than $3.00 per month).
charge low flat/fixed/static investment fees.
Investments
At The HSA Report Card we are big believers in passive index investing. Thus, we believe the best investment lineups, at a minimum, should allow participants to build globally diversified, low cost indexed portfolios . When examining the investment lineups of HSA plans we graded them on the following:
Expense ratios
In the wacky investment world you don't always get what you pay for. Expensive funds are not guaranteed to outperform their less expensive peers. Lineups with low overall expense ratios received favorable grades, while those with high overall expense ratios received poor grades.
Lineup diversification
We believe each investment lineup should offer the following:
At least 1 low-cost domestic index fund
At least 1 low-cost foreign developed markets index fund
At least 1 low-cost emerging markets index fund
At least 1 low-cost short-term or intermediate term index fund
4-6 low-cost allocation / target date funds
Performance
Predicting which asset class or mutual fund is going to outperform in a particular year is simply impossible. For that reason we don't care about past performance. We don't factor past performance into our grades.
Investment Thresholds
Some HSA administrators require account holders to keep a certain amount of money in a (usually) low paying checking account before they can invest their funds. Keeping funds in a low-interest cash account means accountholders miss out on those funds’ potential investment returns; this is known as opportunity cost.
The best investment HSAs offer first dollar investing. In other words, the best investment HSAs let their account holders invest right away without having to leave any money in the checking account. Thus, administrators with low investment thresholds received the best grades, while those holding HSA dollars hostage, received poor grades.
Features
Lastly, we scoured the universe for HSA plans that spoiled investors with great features. The best investment HSAs offer:
Intuitive websites / apps with hassle-free investment management capabilities
Automatic recurring account to account transfers (external and internal)
Receipt storage tool for "shoeboxers"
The Top Investor HSAs
Standard Plan (Non-Employer Group)
| Fees | Threshold | Investments | Features | Overall | |
|---|---|---|---|---|---|
Fidelity |
A | A | A | B | A- |
Lively |
A | A | A | B | A- |
First Dollar |
A | A | A | B | A- |
Bank of America
| A- | B | A | A | A-/B+ |
HSA Bank |
A | B | A | A | A-/B+ |
Further |
A | B | A | B | A-/B+ |
 Saturna Capital |
A | A | A | D | B+ |
 The HSA Authority |
A- | A- | A | C | B+ |
HealthEquity |
B- | B+ | A | A | B+ |
|
C | B | A | A | B |
| C | C | B+ | A | B- |
Disclosure: The HSA Report Card rankings are not recommendations to enroll in a particular HSA plan. Your unique HSA needs cannot be summed up by any rating or score. Instead, The HSA Report Card offers an easy to use snapshot of expert opinion and information to make analyzing and understanding your HSA plan options a simpler, more informed experience.
In Depth Reviews
Bank of America offers investors a first class pre-selected investment lineup. This iconic bank's offering is right up there among the best in the nation.
Fidelity recently made a grand entrance into the individual/family HSA space with an incredible offering that includes first dollar investing, a brokerage account, no maintenance fees and zero expense ratio funds.
One of the best HSAs for Spenders also lets you invest for free via a TD Ameritrade brokerage account - making it a great option for those who seek ultimate freedom when it comes to investments.
Further features exceptionally low fees, access to a Schwab self-directed brokerage account, and superior customer service.
Reasonable fees, the ability to automate investments with guided portfolios, and access to a TD Ameritrade self-directed brokerage account make this administrator an attractive option for a wide variety of investors.
HealthEquity offers a solution for every kind of investor, from the experienced to the novice. This administrator also hit the ball out of the ballpark with its all Vanguard investment lineup.
This startup is catching the eye of many with its low fees, slick user friendly platform and flexible investment options. Lively offers investors a brokerage account and / or a pre-selected investment lineup.
This behemoth services close to 5.6 million accounts and holds approximately $12 billion in HSA assets. Optum offers investors a pre-selected investment lineup, a robo-advisor offering and abrokerage window via Charles Schwab.
This arm of Old National Bank is a bit old school in its practices, but features exceptionally low fees and a nice suite of investment options.
Bend's HSA Saver Program is an easy to use investing platform ideal for index investor’s looking to automate their investments.