Tuesday, November 25, 2008

HSA Updates.

I now have my HDHP (high deductible health plan) that costs around $90 a month with a ~$1500 deductible. So from there I started to look for a company I could setup my health savings account with. Many of the banks I looked at tack on various fees or have pretty poor interest rates around 2% to 3%. On the other hand, credit unions seem to be a bit better in regards to fees and interest rates. I noticed a large FAQ on fatwallet.com about the subject and found Stanford Federal Credit Union. They don’t have any monthly fees and their interest rate is around 5%. The only negative is that they are located in California.

If you don’t know how credit unions work, you usually need to be affiliated with the credit union in some way before you can become a member. Credit unions are not-for-profit, so they are usually able to have good rates with lower fees than standard banks can.

In this case, I could submit a small donation to “The Friends of Palo Alto library.” Once I became a member of that, I then applied to Stanford Federal Credit Union. The nice thing about it is that once I am a member of the credit union, I technically am a stock holder. So this is a one time step that I needed to take. Another plus is that I was able to help a library buy children’s books or something.

Once my application to the credit union is approved, I’ll fill out the HSA account forms and get that account setup.

The nice thing about this credit union is that they seem to have a quality website and system for allowing me to get money into my soon-to-have accounts. Once the HSA is setup, I will have a debit card that I can use to make medical payments with.

(Edit: In retrospect, I would suggest going with a local bank or credit union if you can. With so many forms and procedures involved, it would be quite a bit easier that way.)

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