Understanding How Account Holders Use Their HSAs

Lively’s 2021 HSA Account Holder Insights report provides insights into how account holders save, spend, and invest their HSA funds that brokers and employers can use to better serve their clients and employees.

For too long the HSA industry has been focused on the “typical” HSA account holder. This has resulted in one-size-fits-all pronouncements about the needs of these account holders when it comes to HSA education that don’t fully serve HSA users. Lively’s second annual HSA Account Holder Insights report demonstrates that, contrary to the way much of the insurance, financial services, and benefits industries approaches HSA marketing, there is no “standard” HSA account holder.

Lively’s report breaks HSA account holders into seven distinct “personas” based on real data from 50,000 randomized Lively account holders. It enables readers to understand each persona’s saving, spending, and investing behaviors, as well as examining changes in behavior from 2020.

Key insights from the report include:

  • The majority of HSA account holders are using their accounts to focus on yearly and expected tax-advantaged healthcare spending, but the most investment-savvy account holders are maximizing their HSAs for retirement.

  • Why investing fell sharply for 80 percent of account holders in 2021 and how the ongoing pressures of the pandemic impact HSA investment decisions.

  • Cash balances remained flat from 2020, but average spend increased for some groups and decreased for others, depending on whether they were actively using their HSA as a vehicle for health spending or were more focused on retirement savings.

  • The differences in cash balances and investing for family versus individual accounts, and employer-sponsored versus individually held HSAs.

  • The impact that the CARES act and consumer behavior, including bundling health-related expenses, has had on HSA debit card spending.

Benefits, human resources, and financial services professionals can use this report to understand the wide variety of individuals and families who are using HSAs for routine medical expenses, saving for the unexpected, and investing with an eye towards retirement.

Understanding these different personas’ saving and spending needs and behaviors will enable better assessment of HSA providers and benefits programs overall. For more actionable insights, deep analysis, and clear next steps that readers can use to better serve their clients and employees and choose an HSA that best serves them, download the report.

Disclaimer: the content presented in this article are for informational purposes only, and is not, and must not be considered tax, investment, legal, accounting or financial planning advice, nor a recommendation as to a specific course of action. Investors should consult all available information, including fund prospectuses, and consult with appropriate tax, investment, accounting, legal, and accounting professionals, as appropriate, before making any investment or utilizing any financial planning strategy.

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