Question 1

Can I have an HSA with both Lively and Fidelity simultaneously?

Accepted Answer

No, you cannot simultaneously contribute to two separate HSAs in the same tax year. The IRS rules state that you can only contribute to one HSA. However, you can transfer or roll over funds from one HSA provider to another without penalty. For instance, you could open an account with Lively, contribute for a period, and then roll those funds into a Fidelity HSA if you decide to switch providers, or vice-versa.

Question 2

Are there any hidden fees to watch out for with Lively or Fidelity HSAs?

Accepted Answer

Neither Lively nor Fidelity typically charges monthly maintenance fees for their primary HSA accounts. However, it's essential to scrutinize their investment platforms. Fidelity often offers commission-free ETFs and mutual funds, but some specialized funds may have expense ratios. Lively, when using their investment partners (like Devenir for self-directed or Schwab for brokerage), might have platform fees or specific fund fees.

Question 3

How do the investment options differ between Lively and Fidelity HSAs?

Accepted Answer

Fidelity offers a fully integrated brokerage platform, allowing direct investment into a wide array of stocks, ETFs, mutual funds, and bonds, often commission-free. This is ideal for those who want extensive control and investment choice. Lively, on the other hand, partners with other investment platforms like Devenir (for guided portfolios) or Charles Schwab (for self-directed brokerage).

Question 4

Which provider offers better customer service for HSA account holders?

Accepted Answer

Customer service experience can be subjective, but generally, both Lively and Fidelity are well-regarded. Fidelity has a vast network of physical branches and extensive phone support, appealing to those who prefer in-person assistance or traditional phone lines. Lively is a more modern, tech-focused provider, offering strong online tools and responsive digital support (email, chat). Your preference for traditional vs. digital interaction will likely dictate which service style you find 'better'.

Question 5

How do I transfer an existing HSA to either Lively or Fidelity?

Accepted Answer

Transferring an HSA typically involves initiating a rollover or trustee-to-trustee transfer. You'll usually start the process with the new provider (Lively or Fidelity). They will provide the necessary forms, which often require information about your current HSA provider and account number. You can elect a direct trustee-to-trustee transfer, where funds move directly between institutions, or an indirect rollover, where you receive a check and have 60 days to deposit it into the new HSA.

Question 6

What are the basic eligibility requirements to open an HSA?

Accepted Answer

To be eligible for an HSA, you must be covered by a High Deductible Health Plan (HDHP), have no other health coverage (with some exceptions like dental/vision), not be enrolled in Medicare, and not be claimed as a dependent on someone else's tax return. These rules are non-negotiable and apply regardless of whether you choose Lively, Fidelity, or another provider. Many W2 employees with HDHPs meet these criteria, as do many self-employed individuals.

Question 7

What are the HSA contribution limits for 2026?

Accepted Answer

While specific limits for 2026 are usually released later in the year, for context, the 2024 limits are $4,150 for self-only coverage and $8,300 for family coverage. Individuals aged 55 or older can contribute an additional $1,000 catch-up contribution. These limits are set by the IRS and apply uniformly across all HSA providers, including Lively and Fidelity, so your choice of provider won't affect how much you can contribute annually.

Question 8

Can HR benefits managers set up HSAs for employees with either provider?

Accepted Answer

Yes, both Lively and Fidelity offer solutions for employers to manage employee HSAs. HR benefits managers can integrate these platforms into their benefits packages. Lively is known for its modern, user-friendly employer dashboard, simplifying administration. Fidelity, with its vast institutional services, also provides robust employer solutions, often preferred by larger organizations. Both help streamline contributions directly from payroll.

Question 9

What happens if I over-contribute to my HSA?

Accepted Answer

Over-contributing to your HSA can result in a 6% excise tax on the excess amount for each year it remains in the account. To avoid this, you must withdraw the excess contributions and any earnings attributable to them by the tax filing deadline (including extensions) for the year of the over-contribution. Both Lively and Fidelity will typically provide guidance on how to rectify an over-contribution, but it's crucial to track your contributions carefully to avoid this penalty.

Question 10

Are there any tax deductions for HSA contributions?

Accepted Answer

Yes, direct contributions made to an HSA are tax-deductible on your federal income tax return, even if you don't itemize deductions. This is often referred to as an 'above-the-line' deduction. Additionally, contributions made by your employer (including through payroll deductions) are pre-tax, meaning they reduce your taxable income.

Question 11

Which provider is better for hands-on investors?

Accepted Answer

For hands-on investors who want full control over their investment choices, Fidelity often has an edge due to its integrated brokerage platform. You can directly buy and sell individual stocks, ETFs, mutual funds, and bonds within the same account interface. Lively requires moving funds to a partner brokerage (like Charles Schwab) for self-directed investing, which is an extra step and might feel less seamless for those accustomed to a single platform.

Question 12

Can I invest my HSA funds in mutual funds with both Lively and Fidelity?

Accepted Answer

Yes, both Lively and Fidelity allow you to invest your HSA funds in mutual funds. Fidelity offers a vast selection of its own mutual funds, many with no transaction fees, plus access to thousands of funds from other families. Lively, through its investment partners, also provides access to a range of mutual funds. The main difference lies in the breadth of selection and the integration of the investment platform with the core HSA cash account.

Question 13

Do either provider offer guided investment options for beginners?

Accepted Answer

Yes, both providers cater to beginners. Fidelity offers various resources, target-date funds, and model portfolios that can simplify investment decisions. Lively, through its partnership with Devenir, provides guided investment options where you can select a risk profile, and your funds are automatically allocated to a diversified portfolio, which is excellent for those who prefer a hands-off approach or are new to investing.

Question 14

How do I manage investment risk with my HSA at Lively or Fidelity?

Accepted Answer

Managing investment risk involves diversifying your portfolio and choosing investments that align with your risk tolerance and time horizon. Both Lively and Fidelity provide tools and resources to help with this. Fidelity offers research tools, risk assessment questionnaires, and a wide range of investment products to build a diversified portfolio.

Question 15

Can I use my HSA for retirement healthcare expenses?

Accepted Answer

Absolutely. The HSA is often dubbed the 'triple tax-advantaged' account because contributions are tax-deductible, investments grow tax-free, and withdrawals for qualified medical expenses are also tax-free. After age 65, you can withdraw funds for any purpose without penalty, though non-medical withdrawals will be subject to ordinary income tax, similar to a traditional IRA.

Question 16

Which provider offers a better mobile app experience?

Accepted Answer

Lively generally receives high marks for its modern, intuitive mobile app and online platform. It's designed for a seamless digital experience, making it easy to track expenses, make contributions, and manage investments on the go. Fidelity also has a robust mobile app, but its interface might feel more complex due to the sheer breadth of financial services it offers, which can be overwhelming if you're only focused on your HSA.

Question 17

Do either Lively or Fidelity charge fees for account inactivity?

Accepted Answer

Neither Lively nor Fidelity typically charges fees for account inactivity. This is a common concern for HSA holders, especially those accumulating funds for future medical expenses or retirement. Both providers aim to keep their core HSA accounts free of maintenance fees. However, always review the most current fee schedule, as policies can change, particularly for investment-related actions or specialized services.

Question 18

How do their expense tracking and reimbursement features compare?

Accepted Answer

Lively shines in its expense tracking capabilities, offering a user-friendly interface to upload receipts and categorize qualified medical expenses. This makes it easier for users to manage their records and prepare for potential IRS audits. Fidelity also provides expense tracking tools, though some users find Lively's dedicated HSA focus makes its expense management slightly more streamlined and intuitive for healthcare-specific record keeping.

Question 19

What are the options for accessing HSA funds for qualified medical expenses?

Accepted Answer

Both Lively and Fidelity provide multiple ways to access your HSA funds. They typically offer a debit card specifically linked to your HSA for direct payment at healthcare providers or pharmacies. You can also submit claims for reimbursement if you paid out-of-pocket, or set up direct bill pay to healthcare providers. Fidelity might also allow transfers to linked bank accounts more directly within their broader financial ecosystem.

Question 20

Is it easy to get tax forms (e.g., Form 1099-SA, Form 5498-SA) from both providers?

Accepted Answer

Yes, both Lively and Fidelity make it straightforward to access your essential tax forms. They typically provide these forms electronically through your online account portal, usually by late January or early February each year. These forms are crucial for filing your taxes and correctly reporting your HSA contributions and distributions to the IRS, helping you avoid any confusion or missing deductions.

how does lively compare to fidelity for hsa accounts?: Your Questions Answered

Understanding Eligibility and Contribution Rules

Maximizing Your HSA's Investment Potential

Comparing Fees, Features, and User Experience

Summary

Pro Tips

Quick Answers

Can I have an HSA with both Lively and Fidelity simultaneously?

Are there any hidden fees to watch out for with Lively or Fidelity HSAs?

How do the investment options differ between Lively and Fidelity HSAs?

Which provider offers better customer service for HSA account holders?

How do I transfer an existing HSA to either Lively or Fidelity?

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