Data & Research August 25, 2015

HSAs Growing in Popularity, EBRI Finds

Balances in HSAs that leverage 401(k)-like investments are six times larger than those without them.
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At the end of 2014, account balances in health savings accounts (HSAs) with investments averaged $10,261, or about six times the average $1,709 balance in HSAs without investments, according to the Employee Benefit Research Institute (EBRI).

In 2014, 6.4% of accounts in the EBRI HSA Database of 2.9 million HSAs had used the investment option portion of the account. Forty-seven percent of the HSAs with investments were opened between 2005 and 2008, compared with 8% of HSAs without investments. Among HSA owners with investments, the average age was 48.5 in 2014, compared with 43 among HSA owners without investments.

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Individuals contributed an average of $2,636 to HSAs with investments and $1,224 to HSAs without investments. Annual distributions for health care claims from HSAs with investments averaged $1,777 in 2014, and $1,293 from HSAs without investments.

“HSAs often have an investment account option that allows account owners to invest in not just a money market account, but in mutual funds and other investment vehicles much like they would in a 401(k) plan,” explains Paul Fronstein, director of EBRI’s Health Research and Education Program and author of the report. “Some HSA owners may use the investment account option as a means to increase savings for retirement, while others may be using it for shorter-term investing.”

In fact, EBRI issued another report on HSAs late last year that found, depending on the deferral rates and rate of return realized, an individual who saves in an HSA for 10 years could accumulate between $35,000 and $68,000, while those saving for 20 years could accumulate between $118,000 and $193,000.

EBRI’s full report can be downloaded here.

Products August 25, 2015

LPL Vendor Affinity Program Adds MoneyGuidePro

LPL advisers can now access MoneyGuidePro financial planning software solutions at a discounted price. 
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PIEtech Inc., the creator of financial planning software MoneyGuidePro, has been selected for inclusion in the LPL Financial Vendor Affinity Program. As explained by LPL, the preferred vendor program helps advisers and staff access vetted, discounted services from third-party vendors through a centralized online portal.

LPL says PIEtech was selected for the program “based on the value they can provide advisers as an innovator in goals-based financial planning.”

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Victor Fetter, LPL Financial managing director and chief information officer, says his firm “recognizes that technology is a major contributor to creating increased efficiency and driving greater productivity in our clients’ businesses.”

Kevin Knull, president of Pietech, notes many advisers face the prospect of being overwhelmed or left behind by “wave after wave of rapidly emerging technology.” Working with a third-party provider such as PIEtech allows advisers to “harness that technology in ways that make their jobs easier and client relationships stronger,” Knull suggests.

As a software solution supporting client service, MoneyGuidePro allows for college, retirement, estate and Social Security planning, as well as investment and insurance needs analysis, technology integration and account aggregation. More about how MoneyGuidePro works is at www.moneyguidepro.com.

Other recent additions to the LPL Vendor Affinity Program include Retiremap and Broadridge, which joined the more than 50 original vendors ranging from Morningstar, S&P Capital IQ, McAfee and Malwarebytes to FedEx, Staples and Avis. 

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