Hi – I got laid off from my tech job where I had an HSA. I was contributing the max $$$. Now that I'm unemployed (and might be self-employed for a while), what are my options for continuing an HSA? Should I just sign up for one as individual, are their good/bad ones? What are some things I should watch out for? Can I rollover like a 401k?
Don't want plugs for specific companies, just looking to understand what questions I should be asking and if there are any major flags.
HSAs after leaving corporate job
byu/milar55 inpersonalfinance
Posted by milar55
3 Comments
Roll over your HSA accounts to Fidelity HSA.
Self-employed individuals (sole prop, partner, LLC, >2% S corp) cannot do Section 125 cafeteria plan contributions, so the best you can do is getting your own insurance and contributing to that Fidelity HSA outside of payroll.
Another vote for Fidelity… the best time to open an HSA there was while you were still employed, but hey, nothing wrong with now.
To be clear though – you can’t *contribute* to an HSA (as in add new money) unless you’re covered by a qualifying HDHP (up to the limit calculated by how much of the year that was true). But yes you can roll money over… you can also keep it, invest it, make money with it, reimburse yourself for old expenses, or use it to pay for new expenses, regardless of your current coverage.
1x per 365 days, you can do an indirect rollover, which means just taking money out of one HSA, and depositing the same amount into another HSA (making sure to check the correct box that it’s a rollover) within 60 days. Which if you don’t have any other HSA account, I would assume you could do in this case.
To continue funding an HSA you need to still be in a HDHP and not be a dependent under a spouse, parent, etc. I also don’t know if your employers plan would allow contribution now that you are no longer with the company.
I would highly suggest rollovers though since the fees for former employees are (normally) increased so you’re just burning money. The rollover would work the same way a 401k -> IRA rollover does. You’d be going from the employer-managed HSA to an individual-managed HSA.
Since you don’t want company recommendations then I’ll just say to watch for any fees.