On October 30, 2017 at 15:53, imt said...
Mario,
One thing I see missing from your previous comparison of PPO vs HDP/HSA is the premium cost for the HDP/HSA in the first place.
You mention in your previous post that for "paycheck" amounts you instruct your HSA people how your pay periods are. Since you are on your own I believe, no employees, I assume you aren't getting a paycheck correct? If so, it would be the payroll company that would then handle the deduction and couldn't fudge it anyway. Yes if you changed to monthly or quarterly, your amounts would be larger but you wouldn't get you $$ faster. If anything you would get them slower. Pay is never in advance. Its always in arrears (after you worked the hrs, week, bi-weekly, month etc.) Getting paid weekly means you get contributions into your HSA on a weekly basis, although smaller. Monthly means you have to wait 4-5 weeks for the $$ to be in the acct and will be larger (but basically equal to what you would have put away on a weekly paycheck). Now it also depends on if your health dollars are in a fixed acct or some type of investment option. If the latter, you are better off with weekly or bi-weekly, smaller payments, to dollar cost average. Since our contributions are done via my wife's corp employer, the premiums and HSA or FSA contributions are all pre-tax $$. I assume the same is the case with your premiums and HSA $$?
My standard PPO premiums would be $4,800.
HSA administrator talks to payroll company about how much they want to take per paycheck.
Telling HSA that I get paid monthly vs. bi-weekly means that they (HSA admin) take my max (because I told them I want to contribute max) allowed amount, in my case $6,750 for 2017 and divide it by # of paychecks.
So bi-weekly paychecks = 26
Monthly paychecks = 12
$6,750/26=$259.62
$6,750/12=$562.50
Telling them I get paid monthly expedites my deductions/contributions.
Since I'm investing my 'excess' balance, the sooner I can make deposits, the sooner the money is there to grow.
BTW, in my case, I maxed out my yearly contributions early. HSA admin contacted payroll and asked them to stop making contributions due to max being reached. Same thing happened for 401K, which is managed by another company.
This is something that apparently happens regularly with companies that pay out performance and/or quarterly bonuses.
Amounts are figured at beginning of the year with regular paychecks being the only things figured in. Extra deposits/bonuses/expense reimbursements that are not attached to regular paychecks speed up deposits and people max out their IRS allowed contributions somewhere in late Oct. or Nov.
