Fidelity’s HSA Business Surpasses One Million Account Holders, $4.1
Billion in Assets
Expanded Availability Direct to Individuals, New Auto-Invest
Capability, Plus Elimination of Transaction Fees and Minimums Provide
Opportunity for More Investors to Maximize HSAs
Yet 91 Percent of Customers Not Taking Advantage of One of HSA’s
Most Valuable Benefits
Investments® , one the industry’s most diversified
financial services firms, today announced double-digit asset growth of
its health care savings account (HSA) business, driven by the firm’s
ongoing efforts to broaden availability and enhance the capabilities
these accounts offer to help employers and individuals more effectively
manage health care expenses. In 2018, Fidelity:
- Expanded availability of HSAs to small- and mid-size employers
Introduced a new retail
HSA offering to individuals who may not have access to an HSA
through their employer,
Simplified HSAs by eliminating account transaction fees1
and minimums to invest2,
Added Fidelity HSA® Funds
to Consider, a list of curated investment options for HSA
Launched auto-invest feature to encourage investing behaviors,
which 91 percent of account holders don’t do and instead hold their
savings in cash,
Optimized education and guidance available through digital
tools supporting savings prioritization and other contribution
“There is no disguising the sense of urgency we hear from employers3
and individuals4 who say that rising health care costs are
among their biggest financial concerns. In fact, one-in-four Americans
say that health care is the most critical issue facing our country today5,”
said Begonya Klumb, Head of HSA, Fidelity Health Care Group.
“Our efforts to broaden accessibility of Fidelity HSAs and continue
enhancing account capabilities are all aimed at helping individuals feel
more empowered and prepared to manage their health care costs with
simple straightforward options,” continued Klumb.
HSAs are an important component of Fidelity’s goal of becoming a leading
digital health care benefits provider, ensuring that employers and
individuals have the savings tools and guidance needed to make health
care savings a priority. In 2018, Fidelity added 232 new employers that
now provide HSAs to their employees. In addition, the firm has more than
doubled the number of HSAs under administration in the last three years,
with 1,039,500 individual account holders representing more than $4.13
billion in assets (a 35 percent increase from the start of 2018)6.
Fidelity is the fourth largest provider of HSAs.
According to Fidelity research, 29 percent of employees with access to
an HSA are now enrolled and using one of the triple tax-advantaged7
health savings accounts, up from 25 percent in 20178. When
employers only offer an HSA-eligible health plan, nearly half (49
percent) are electing to add this savings benefit. HSAs offer tax-free
contributions, tax-free growth on balances and tax-free withdrawals for
qualified health expenses, making them a powerful savings and investing
tool to address both current and future health care expenses, even those
New Enhancements to Fidelity HSA Help Your Balance Work Harder
One of the most valuable and underutilized attributes
of the HSA is the ability to invest balances for potential growth,
building up savings that can be used for longer-term qualified medical
expenses, including those in retirement. At the end of 2018, more than
91 percent of Fidelity HSA funded account holders held all of their
savings in cash. In fact, nearly half of HSA owners don’t even realize
that they can invest contributions to take advantage of long-term
potential growth9. For those who carry a balance, or don’t
already take advantage of maxing out their annual contributions, this
represents a significant missed opportunity.
Fidelity recently removed a host of monetary barriers that may hold
savers back from utilizing the HSA account for their full benefit. While
many HSA providers charge a variety of fees to individual account
holders (account opening, funds transfer, debit cards, excess
contributions, etc.) and a separate fee to invest an HSA account
balance, Fidelity does not charge any account transactions fees or any
separate account fee to invest:
- Zero account transaction fees10,
- Zero separate account fee to invest11, and
- No minimum balances to begin investing12.
Fidelity provides a menu of investment options to meet the needs of
different types of investors. For account owners looking for a broad
range of choice, Fidelity offers a full brokerage platform with access
to more than 10,000 investment options.
For those who want a “do-it-myself” solution, but seek a simplified set
of options, Fidelity introduced the Fidelity
HSA Funds to Consider, a curated list of 25 active and passive
fund options with zero account minimums. This list is selected and
monitored by Fidelity’s investment professionals, and includes single
fund solutions such as target date funds as well as individual asset
For workplace HSA owners looking for a “do-it-for-me” investment
solution, coming later this year, Fidelity will be offering an HSA
advice solution. Using the Fidelity HSA Funds to Consider
line-up, Fidelity will help account holders determine first how to
allocate HSA savings between transactional cash needs and medium-to-long
term investing, and then how to invest those funds based on their
investment profile and needs. Regardless of the investment path the
account holder chooses, there are no account transaction fees or minimum
balance to start investing.
Fidelity also introduced new tools to help workplace HSA owners make
more informed contribution decisions, and to simplify the process of
investing. Recognizing that many employees want to save for both health
care and retirement, but are unsure how to allocate savings, Fidelity
provides a point of view to help make the most of pre-tax contributions.
For employees with access to both a workplace retirement savings plan
like a 401(k) and an HSA, Fidelity’s digital tools can help account
owners determine how to prioritize their savings – based on their
individual financial circumstances. For instance, the tool guides them
on how much to allocate to retirement, how much to set aside in their
HSA, and in what order they should make these contributions.
For HSA owners who wish to invest contributions for the future, a
simplified auto-invest functionality enables workplace account holders
to set a personal cash target to cover short-term medical expenses (or
their health plan annual deductible), and then have contributions over
and above that target automatically invested for longer-term savings.
More Resources to Understand and Plan for Health Care Expenses
To help individual savers and employers learn more about planning and
savings for health care, Fidelity has developed a range of resources,
healthy habits for health care savings accounts; How
to plan for rising health care costs; How
to talk to your doctor – and save money; 5
ways HSAs can fortify your retirement; Your
bridge to Medicare; Getting
your HSA in shape.
For more insights on how Fidelity workplace HSA owners utilize their
accounts, see the 2019
HSA Fact Sheet.
About Fidelity Investments
Fidelity’s mission is to inspire better futures and deliver better
outcomes for the customers and businesses we serve. With assets under
administration of $7.1 trillion, including managed assets of $2.6
trillion as of January 31, 2019, we focus on meeting the unique needs of
a diverse set of customers: helping more than 30 million people invest
their own life savings, 22,000 businesses manage employee benefit
programs, as well as providing more than 13,500 financial advisory firms
with investment and technology solutions to invest their own clients’
money. Privately held for more than 70 years, Fidelity employs more than
40,000 associates who are focused on the long-term success of our
customers. For more information about Fidelity Investments, visit https://www.fidelity.com/about.
Keep in mind that investing involves risk. The value of your investment
will fluctuate over time and you may gain or lose money.
Fidelity Brokerage Services LLC, Member NYSE, SIPC
Street, Smithfield, RI 02917
©2019 FMR LLC. All rights reserved.
1 Account transaction fees refers to fees for account
features such as account opening, funds transfer, debit cards, excess
contributions, etc. and does not include recordkeeping fees, which may
be charged to employers. Employers may choose to pass recordkeeping fees
on to employees.
2 There may be funds that require a
minimum amount to invest, but Fidelity does not require a minimum to
3 Fidelity Client Panel Survey,
4 Fidelity Investments Financial
Resolutions Survey, November 2018
5 Fronstin, Paul, “Workers
Rank Health Care as the Most Critical Issue in the United States,” EBRI
Issue Brief, September 24, 2018
6 Fidelity recordkept
data of HSAs as of January 31, 2019
7 With respect to
federal taxation only. Contributions, investment earnings, and
distributions may or may not be subject to state taxation.
Fidelity recordkept data of HSAs through December 31, 2018
Represents the findings of an online survey conducted among a
demographically representative U.S. sample consisting of 5,133 adults,
18 years of age and older. Interviewing for this CARAVAN® Survey was
completed Dec. 9 – 21, 2016, by ORC International, which is not
affiliated with Fidelity Investments. Included in the analysis were
1,309 respondents enrolled in an HSA-eligible health care plan. The
results of this survey may not be representative of all adults meeting
the same criteria as those surveyed for this study.
Account transaction fees refers to fees for account features such as
account opening, funds transfer, debit cards, excess contributions, etc.
and does not include recordkeeping fees, which may be charged to
employers. Employers may choose to pass recordkeeping fees on to
11 Commissions and other expenses associated
with transacting or holding specific investments (e.g., mutual funds)
may apply. Refer to the fees and commission schedule for additional
detail at https://www.fidelity.com/trading/commissions-margin-rates.
There may be funds that require a minimum amount to invest, but Fidelity
does not require a minimum to start investing.
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