Investing Your HAS

As of mid-year 2026, Truemed reported that HSA assets reached $159 billion. Can you invest the funds in your HSA? Yes—but so far only a small fraction of HSA accounts are using investments.

First, a quick refresher on health savings accounts is in order. HSAs are only available to those covered by a qualified high-deductible health plan (HDHP). The minimum deductible amounts are set by the IRS, and for 2026 they are $1,700 for self-only plans and $3,400 for family plans.

If your current health insurance deductible is less than these amounts, you do not have an HDHP and therefore are not eligible to set up an HSA.

For 2026, the HSA contribution limit is $4,400 for individuals and $8,750 for families (including both employee and employer contributions). If you’re age 55 or older, you’re allowed an additional HSA catch-up contribution of $1,000. HSA contributions are tax-deductible, grow tax-free, and are distributed tax-free for qualified medical expenses.

Along with triple-tax benefits, there aren’t any “use it or lose it” provisions associated with HSAs. This means that funds remaining in the account at the end of the year can be used for future medical expenses and for long-term investment growth. That makes these accounts powerful savings vehicles!

Spending Accounts vs. Investment Accounts

There are essentially two ways to look at HSAs. The first is to view them as spending accounts, i.e., a source of ready cash for paying those high-deductible amounts. The less traditional approach is to view them as investment accounts in which your funds are invested in stocks, bonds, or mutual funds.

Neither viewpoint is wrong. However, investing HSA funds for long-term growth does have several advantages. The combination of compound interest and tax-free growth makes HSAs a great savings vehicle for future medical costs, especially during retirement, when medical expenses tend to be higher.

So how should you decide whether to spend or invest your HSA dollars? The first consideration is based on your current financial situation. It might make more sense to view your account as a spending vehicle if you answer “no” to any of the following questions:

• Are you able to pay insurance deductibles and qualified medical expenses from other sources?
• Have you saved an adequate emergency fund (three to six months of living expenses)?
• In the near future, are you clear of major healthcare expenses, such as pregnancy or surgery?

Conversely, you might be a good candidate for investing your HSA funds for future medical expenses if you answered “yes” to all the above.

Your Financial Institution Matters

If you’ve decided that treating your HSA as an investment account would be more beneficial for you, the next step is to determine if the financial institution that holds your account will allow you to invest your HSA funds. Not all providers allow you to invest your HSA, and those that do may offer unattractive investment options and/or high fees.

The good news is that you generally are allowed to move your HSA from one financial institution to another one of your choosing. Doing this is fairly straightforward: open a new HSA account and have the new financial institution roll over your existing HSA.

Your employer may still require new contributions to go into the old account. However, you can periodically roll accumulated contributions to your new HSA. Before choosing this option, check if the old plan charges transfer fees—this could affect your rollover frequency.

Key Questions When Shopping For a New HSA Provider

• Do they require that you keep a minimum amount of cash in the HSA account? If so, how much and what interest rate do they pay for the cash you are required to keep?
• Do they charge annual or monthly fees for the HSA account, and do they also charge additional fees for investing all or part of your account?
• How many investment choices are available to use on their platform? Is it open-ended, or are there a limited number of investments to choose from?
• If you do need to access the money, is there an easy way to do so?

Summary

While HSAs are traditionally viewed as spending accounts, they can also be seen as longer-term investment opportunities with some nice advantages. Established national investment providers like Fidelity have now entered the field, increasing competition, and improving terms for HSA investors.

Take a moment to review your current provider to see if their benefits and terms are solid, or better yet, consult with your financial planner to go over your HSA questions!

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