Unlike flexible spending accounts, you don't have to "use it or lose it" with an HSA each year. In fact, more than three-quarters of HSA account holders withdraw less than they contribute, and roughly a quarter of people don't touch any money from their accounts, according to Fidelity.
Your employer may direct you to sign up with its preferred HSA provider, but if you are enrolled in a qualified high-deductible health plan, you can choose whatever provider you want. However, if employers only offer matching HSA contributions to their preferred provider, it makes sense to stick with them.
Roughly 80 percent of employers give "seed money" to workers to fund their HSAs, according to Fidelity. That can come in the form of a direct contribution or a dollar-for-dollar match. The average contribution at Fidelity-run plans was $541 last year.
If you do receive matching contributions to your HSA, Roy Ramthun, president and founder of HSA Consulting Services, recommends that you keep one HSA with your employer's preferred provider and open another one to use as an investment account.
Devenir estimates that about 4 percent of people are using their HSAs as investment plans. Many HSA providers require that you have at least $1,000 in your account before you can invest.
How should people invest their HSA money? Generally, you should have enough cash in your HSA to cover expected medical expenses and invest the rest. Here are some portfolio guidelines Fidelity uses based on age: