Hey there! Ready to supercharge your savings and take control of your healthcare future? Setting up automatic investments in your Fidelity Health Savings Account (HSA) is one of the smartest moves you can make. Not only does it help you grow your money tax-free for qualified medical expenses, but it also instills a fantastic habit of consistent saving.
Let's dive in and get you set up for financial success with your Fidelity HSA!
The Power of Automating Your Fidelity HSA Investments
Before we get into the "how-to," let's quickly understand why automating your HSA investments is so powerful. It's all about:
Dollar-Cost Averaging: By investing a consistent amount regularly, you buy more shares when prices are low and fewer when prices are high. This can help mitigate the impact of market volatility over time.
Discipline and Consistency: Life gets busy, and it's easy to forget to make manual investments. Automation removes the guesswork and ensures your money is always working for you.
Tax Advantages: Remember, your HSA offers a triple tax advantage: tax-deductible contributions, tax-free growth, and tax-free withdrawals for qualified medical expenses. Investing those funds further amplifies these benefits.
Long-Term Growth: Your HSA is not just for immediate medical expenses. It's a powerful retirement savings vehicle, especially for healthcare costs in your later years. Automating investments helps compound your returns over decades.
Step-by-Step Guide: Setting Up Automatic Investments in Your Fidelity HSA
Here's how to set up recurring investments in your Fidelity HSA, broken down into easy-to-follow steps:
Step 1: Log In to Your Fidelity Account
First things first, let's get you into your Fidelity account.
Go to Fidelity.com: Open your web browser and navigate to the official Fidelity Investments website.
Enter Your Credentials: Input your Username and Password in the designated fields.
Complete Security Verification: Fidelity often uses multi-factor authentication for your security. Be prepared to enter a code sent to your phone or email, or use another verification method.
Having trouble logging in? Don't worry! Fidelity's customer service is excellent. Look for the "Forgot Username" or "Forgot Password" links, or use their online chat/phone support.
Step 2: Navigate to the Recurring Investment Section
Once you're logged in, you'll need to find where to set up recurring investments. Fidelity makes this relatively straightforward.
From the Top Navigation Bar: Look for the black navigation bar at the top of the page.
Select "Trade": Hover over or click on "Trade."
Choose "Recurring Investment": From the dropdown menu that appears, select "Recurring Investment."
Alternatively, you might find it under "Accounts & Trade" then "Transfers" or "Cash Management" and look for "Manage recurring transfers" or "Your recurring activity."
Step 3: Select Your HSA Account and Investment Type
Now it's time to tell Fidelity which account you want to automate and what you want to invest in.
Choose Your HSA Account: You'll see a list of your Fidelity accounts. Carefully select your Fidelity HSA® account from this list.
Select Security Type: Fidelity allows you to set up recurring investments for various security types. You'll typically choose from:
Stocks/ETFs: If you have specific stocks or Exchange-Traded Funds in mind.
Mutual Funds: A popular choice for HSAs, offering diversification.
Fidelity Basket Portfolios: If you're using Fidelity's pre-built investment baskets.
For most users, especially those new to investing their HSA, Mutual Funds are often a great starting point due to their diversification and professional management.
Step 4: Choose Your Investments
This is where you decide what your money will actually be invested in.
Enter Ticker Symbols: If you know the specific ticker symbols for the stocks, ETFs, or mutual funds you want to invest in, enter them here. You can usually add up to 10 symbols at a time.
Search for Investments: If you're unsure of a ticker symbol or want to explore options, use the search function (often a magnifying glass icon) to find investments by name.
Sub-heading: Considerations for Your HSA Investments
When choosing investments for your HSA, keep these points in mind:
Time Horizon: HSAs are often viewed as long-term investment vehicles, similar to retirement accounts. This generally allows for a higher allocation to growth-oriented assets like equities.
Risk Tolerance: How comfortable are you with market fluctuations? Your comfort level should guide your investment choices.
Diversification: Don't put all your eggs in one basket. Diversify across different asset classes, industries, and geographies. Mutual funds and ETFs are excellent for this.
Expense Ratios: These are the annual fees charged by mutual funds and ETFs. Lower expense ratios mean more of your money stays invested. Fidelity offers many low-cost index funds.
Fidelity's HSA-Specific Funds: Fidelity offers dedicated health savings funds designed with HSA investing in mind. These aim to balance growth with minimizing risk, given the uncertain time horizon of medical expenses. You might want to explore funds like the Fidelity Freedom Index funds (target-date funds) or their specific HSA funds.
Step 5: Specify Your Investment Amount and Frequency
This is the core of your automatic investment plan.
Enter the Dollar Amount: Decide how much money you want to invest with each recurring transaction. Even small, consistent amounts can add up significantly over time. Fidelity generally allows recurring investments between $1 and $100,000 for stocks/ETFs/baskets, and $10 to $100,000 for mutual funds.
Select Frequency: Choose how often you want these investments to occur. Common options include:
Weekly
Every 2 weeks (bi-weekly)
Monthly
Quarterly (less common for highly frequent automation, but an option)
Set Your Start Date: Pick the day you'd like your automatic investments to begin. If the chosen date falls on a holiday or non-trading day, the transaction will typically execute on the next business day.
Step 6: Choose Your Funding Source
How will the money for these investments get into your HSA?
From Your Fidelity HSA Core Position: This is your cash balance within your HSA. If you already have money accumulating there from contributions, you can use this.
From Your Linked Bank Account: This is often the most convenient option for true "automation." You can link an external bank account to your Fidelity HSA, and funds will be pulled directly from there for your recurring investments.
Make sure your bank account is already linked to your Fidelity account. If not, you'll need to set that up under the "Transfers" section.
Step 7: Review and Confirm
Before finalizing, always double-check everything.
Preview Your Order: Fidelity will provide a summary of your recurring investment setup.
Review All Details: Check the account, investment selections, amounts, frequency, and start date. Ensure everything is accurate to avoid any unintended transactions.
Confirm: If all looks good, click "Confirm" or "Submit."
Congratulations!
You've now successfully set up automatic investments in your Fidelity HSA! This disciplined approach will help you maximize the growth potential of your health savings, giving you greater financial security for future medical expenses and even a supplemental retirement nest egg.
Remember, you're always in control. You can adjust or stop your recurring investments at any time by navigating back to the "Manage recurring transfers" or "Your recurring activity" section within your Fidelity account. Periodically review your investment choices to ensure they still align with your goals and risk tolerance.
Frequently Asked Questions (FAQs)
Here are 10 common questions about Fidelity HSA investments:
How to check my current HSA balance at Fidelity?
You can check your current HSA balance by logging into your Fidelity.com account and navigating to your "Portfolio" or "Accounts & Trade" section. Your HSA balance will be clearly displayed there.
How to change my HSA investment choices at Fidelity?
Log in to your Fidelity account, go to your HSA, and look for options related to "Investments" or "Trading." You can typically buy and sell investments directly within your HSA, subject to standard commissions or fund expenses. For recurring investments, you can modify the existing schedule under "Manage recurring transfers."
How to contribute more than my employer to my Fidelity HSA?
You can make additional contributions to your Fidelity HSA yourself, either as a one-time transfer or by setting up recurring transfers from a linked bank account. These personal contributions will also count towards your annual IRS contribution limit.
How to know my HSA eligibility for 2025?
For 2025, you are generally eligible if you are covered by an HSA-eligible High-Deductible Health Plan (HDHP) with an annual deductible of at least $1,650 for self-only coverage ($3,300 for family coverage) and an out-of-pocket maximum not exceeding $8,300 for self-only coverage ($16,600 for family coverage). You cannot be enrolled in Medicare, or claimed as a dependent on someone else's tax return.
How to find low-cost index funds for my Fidelity HSA?
Within the Fidelity platform, when researching mutual funds, look for terms like "Index Fund" and pay close attention to the "Expense Ratio." Fidelity's own "Fidelity ZERO" index funds have 0% expense ratios, and their other index funds (like FXAIX - Fidelity 500 Index Fund) typically have very low expense ratios (e.g., 0.015%).
How to link a bank account to my Fidelity HSA?
Log in to your Fidelity account, go to "Transfers" or "Cash Management," and look for options to "Link a bank account" or "Add a bank." You'll typically need to provide your bank's routing number and your account number.
How to set up a cash target for my Fidelity HSA investments?
While Fidelity doesn't have a specific "cash target" button, you can manage this manually. Decide on an amount you want to keep in your HSA's core cash position (e.g., your annual deductible). Then, set up your automatic investments to invest any funds above that amount.
How to withdraw money from my Fidelity HSA for qualified medical expenses?
You can withdraw money from your Fidelity HSA for qualified medical expenses using your Fidelity HSA debit card, Fidelity BillPay, or by requesting a reimbursement (either a check or electronic funds transfer to your linked bank account) after paying out-of-pocket. Keep all your receipts for tax purposes!
How to transfer an existing HSA from another provider to Fidelity?
You can initiate a transfer of assets (TOA) from your current HSA provider to Fidelity. Log in to Fidelity, go to "Transfers," and select "Transfer an account to Fidelity." You'll typically need information from your old HSA provider. This can be an "in-kind" transfer (keeping your investments) or a liquidation and cash transfer.
How to adjust the frequency of my recurring HSA investments?
Log in to your Fidelity account, navigate to the "Recurring investments" or "Manage recurring transfers" section. Here, you can view your existing automatic investment plans and modify the frequency, amount, or even pause/cancel the schedule.
