Wednesday, January 13, 2010

Free Advice: Worth What You Pay for It?

Recently, one of my HSA clients had a problem with his account. It was minor enough not to be catastrophic, but serious enough that it needed immediate, personal attention. Fortunately, he had chosen a local administrator with whom I've worked for many years, and the president of the firm worked on this personally. The good news is that everything was worked out to my client's satisfaction, with no additional fees or unreturned calls to anonymous phone-jockeys.

My client, we'll call him Melvin, pays about $3 a month in admin fees for his account; a nominal fee to be sure, but certainly not free. So, would he have been better off if he'd chosen one of those "freebies" we see advertised?

Probably not:

Everyone needs a source of HSA knowledge that they can easily access and rely upon to successfully navigate the waters of Alphabet Soup, and there is rarely an easy single part HSA question.

"Free" HSA accounts could leave you with unverifiable deposits, or even alert you that you've contributed too much (a nice problem to have, perhaps, but still a potential headache).

Just as with buying the insurance policy itself from an anonymous website or 800-number, trusting your Health Savings Account to "Bruce" in who-knows-where can be a potential time-bomb.

Your bank may also offer HSA services, but how do you know that they've got the expertise to back it up?

Before you sign on the dotted line, see if there's an independent, professional administrator in your town. You'll be glad you did.

[Hat Tip: FoIB Pete Deist]
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