Make Money Online

Fidelity Hsa (How I Invest It For Maximum $$$)

I used to think an HSA was just a special checking account god I was so stupid cuz an HSA is so much more than that I never maxed out my HSA contributions I never invested my HSA and I missed out on some huge tax savings and potential investment gains but last year I opened an HSA again and this time around it's gonna be different because now I know how to actually make the most of it in this video I'm gonna briefly touch on what an HSA is and how it works then I'm gonna talk about how HSAs work specifically at fidelity I'll also talk about how to prioritize your HSA versus other accounts like your Roth IRA and your 401k and last but not least I'll talk about how to invest your fidelity HSA for maximum profit obviously I can't tell you what to invest in because you're an adult and you can make your own decisions but I will show you how I'm investing my fidelity HSA so you have a real life example of what it could look like for you so if you're interested in learning how to be smarter with your HSA and to make sure you're getting as much benefit out of it as possible then keep watching ok let's start off with a little HSA 101 the HSA stands for health savings account the name is kinda misleading because health savings account sounds like a bank account and that's why for the longest time I didn't know that you could invest your HSA but HSAs are actually not bank accounts they are full-blown investment brokerage accounts and they're designed specifically to help you invest and pay for health care with pre-tax money HSA is come with some really awesome tax benefits in fact I think they're the ultimate investing tax loophole because they give you a tax shelter in three instances you make pre-tax contributions we have tax-free growth and you have two acts free withdrawals as long as those withdrawals are for health related expenses compare that to the traditional IRA traditional IRAs allow you to make pre-tax contributions tax-free growth but not tax-free withdrawals and then the Roth IRA you make after-tax contributions Shen's tax-free growth and tax-free withdrawals so the traditional and the Roth IRA they offer tax shelters in two out of three instances whereas the HSA gives you a tax shelter in all three instances if you could use a helpful guide on how the HSA compares to other types of accounts then download my ultimate guide to IRAs 401ks and HSAs it took me a long time to finally understand the difference between all these different retirement accounts and also it took me a while to understand which ones I should prioritize in my own finances so to make it all easy for you I've packaged everything I've learned and created this PDF that summarizes the benefits of each account there's examples recommendations on which ones you should open as well as where to open them it has literally everything you need to know to set up your accounts for maximum profit so click the link below to download it okay so back to HSAs HSAs are not substitutes for health insurance they are an account that you used in addition to your health insurance and that insurance plan has to be one that allows HSAs when I want self-employed I was shocked by how expensive health insurance is if you don't get coverage from your employer that's why I went for a really cheap insurance plan that allows HSAs because with my cheap insurance plan I pay low monthly premiums and if then when I do need to go to the doctor I can pay for it out of my HSA what's cool about HSAs offer net fidelity is that they're the most flexible HSA provider that i've seen out there with a fidelity HSA you're gonna get access to the full range of stocks bonds ETFs mutual funds and investment products offered at fidelity this is great because many of the other HSA companies out there such as HSA bank and devenir only give you a very limited menu of investments to choose from I don't really like that I don't like being limited so I definitely appreciate the flexibility of my fidelity HSA a fidelity HSA is like a hybrid between a checking account and a brokerage account so as long as you have cash in there that's not tied up in stocks and bonds and other invest you can use it like a checking account you get a debit card that looks like this and you can just swipe it to pay for doctor visits contact lenses prescription drugs and things like that that's why I invest my fidelity HSA a little different from how I would invest say my fidelity Roth IRA because unlike my Roth IRA which I'm not gonna touch until I'm much older I actually need to spend some of my HSA right now on an ongoing basis so that's gonna change how I handle my investments a little bit so when you have X amount of money left over at the end of the month to after you've paid all your basic bills and rent you have a lot of options for example you can use that extra money to pay down debt put it in your 401k put it into a Roth or traditional IRA you can just save it in a bank account or you can invest it in a taxable brokerage account or you can put it in your HSA so where does the HSA fit in with all these different priorities here's how I think of it when you're trying to decide where to allocate your money there's two considerations first of all where can I get the highest after-tax return on my money I'm always thinking about after-tax return the second thing is when do I need to access that money that's the second consideration so if I'm looking for highest after-tax return on my money then the obvious answers are I want to prioritize any type of tax advantaged investment account like HSAs 401ks and IRAs but then the downside of that is that with accounts like those your money is more or less locked up until you retire so if you want to invest and save money to buy a house then an HSA or an IRA probably isn't the place to do it I think the question you need to ask yourself is what's your number one financial goal right now if your number one financial goal right now is to save up to buy a house then probably your HSA isn't the most important thing in your list of priorities for me right now my number one financial goal is to get the highest after-tax return on my money so that I can reach a 1 million dollar net worth as soon as possible I'm also ok with having that million dollars in accounts that I can't access until I'm retired because I'm not planning to touch that money anyway I have other sources of income in the mean time so for me I prioritize my HSA and my Roth IRA the annual HSA contribution limit for 2020 is 35 50 and then for 2019 it was 3500 I always always try to max out my HSA before I max out anything else even over my Roth IRA that's just me though a big part of investing is taking taxes into consideration taxes will eat up at least 20 to 30 percent of your investment earnings but with the HSA and it's triple tax shelter you don't have to worry about any of that although I don't know your exact situation and you may have different financial prioritie

Related Articles

Back to top button
blank