Your health savings account, or HSA, can be a smart long-term investment vehicle that can play an important role in your overall wealth and retirement strategy. Investing a portion of your HSA dollars, if you choose to do so, may potentially grow your savings and can be an additional way to save for long- term health care needs and your financial goals.
In general, contributions to your HSA and potential investment earnings, such as interest or dividends, are income tax free. Once your HSA reaches a certain designated balance, also known as the investment threshold, you may choose to invest a portion of your HSA dollars. We make investing easy and accessible by offering you two investment opportunities.
Your first option is investing your HSA dollars in self-directed mutual funds. You can choose from a wide variety of over 30 mutual funds including life stage funds. They average a four-star Morningstar rating and represent some of the lowest expense ratios in the industry.
Your second option is investing with Betterment. Betterment helps take the guesswork out of investing your HSA. Based on your HSA investment goals Betterment will recommend a personalized portfolio of low-cost exchange traded funds or ETF's and keep your HSA investment on track through auto deposits and automated rebalancing.
Ready to get started? Simply decide how much you would like to transfer into an investment account. The first time you invest, your balance must meet the minimum requirement to invest, plus $100 that you can spread across the funds of your choice. After that, you can invest any amount, as long as you have enough to cover the price of a full share. Then sign into your account and select the investment option that is best for you. If you choose self-directed mutual funds, the asset allocation calculator can help you decide which funds are right for you.
If you choose Betterment, you will answer a few questions and Betterment will create a customized portfolio to suit your needs and invest your HSA dollars for you. If an unexpected medical expense comes up it's no problem. You can easily transfer your investment funds back into your HSA to pay for them. It's that easy. So, give your future a boost and start investing today.
Visit optumfinancial.com to learn more.