New survey results by HealthSavings Administrators finds that employers overwhelmingly outpace benefits professionals in viewing HSAs as a retirement planning tool.
The survey of 270 benefits professionals and employers found that 90% of surveyed employers, benefit consultants, benefit brokers and financial advisors said HSA accountholders are either “somewhat or very knowledgeable” about using HSAs as a means of saving for retirement. Yet, only 16% of benefit professionals said they actually counsel accountholders to invest their HSA funds. In addition, more than 30% of respondents admitted that they do not know if their HSA accountholders are investing their HSA assets.
Respondents also were at odds with the goal of HSAs and how to leverage them as part of a retirement strategy. When asked which HSA attributes are most critical, more than one third (36%) of benefit professionals stated that it is not important to focus on investing rather than saving or spending, while a large majority (74%) simply encourage their accountholders to save.
But among employers, when asked which attributes are most critical, 65% said a focus on investing was important. What’s more, nearly 40% of employers said they encourage HSA accountholders to invest as a retirement option.
Employers also report that access to institutional-class share funds (69%) and funds with low expense ratios (56%) are important when selecting an HSA. Other key findings include:
- 58% of employers and benefit professionals only offer one HSA option; and
- 51% of employers contribute up to $500 to their accountholders’ HSAs each year, while 31% contribute $500-$1,000 and 17% contribute more than $1,000.
“When it comes to navigating the benefits landscape, benefit professionals serve as a critical bridge between employer and employee. They take the lead on employee education programs and are often the first point of contact when accountholders have questions,” notes Craig Keohan, HealthSavings’ chief revenue officer.
Keohan contends, however, that while employers are taking a long-term view in support of their employees’ healthcare needs into retirement, benefits consultants and brokers haven’t yet grasped the value of HSAs “beyond a spend or save mentality.” That approach, he says, can severely restrict the long-term potential of an accountholder’s HSA.
