Wells Fargo does not offer Health Savings Accounts directly

Wells Fargo is a bank, not a health insurance company, so it does not create or sell Health Savings Accounts (HSAs). An HSA is a special savings account that only exists as part of a health insurance plan — you cannot open one through a bank alone, even if that bank is Wells Fargo.

If you have an HSA through your employer's health plan or through an individual health insurance plan you bought yourself, you will need to set it up with the insurance company or the plan administrator, not with Wells Fargo. That said, Wells Fargo does offer custodial services for HSAs — meaning if you already have an HSA elsewhere, you can move the money into a Wells Fargo HSA savings account or investment account to hold and grow those funds.

Key Takeaways

  • You must open an HSA through a health insurance plan first; Wells Fargo cannot create one for you.
  • Once you have an HSA through your insurance, you can move the money to Wells Fargo to hold it in a savings or investment account.
  • Wells Fargo charges fees for HSA custodial accounts, so compare costs with other banks before moving your money.
  • Your employer may already offer an HSA through a specific provider, so check with your benefits office before opening a new account anywhere.

How to get an HSA in the first place

To open an HSA, you must be enrolled in a High Deductible Health Plan (HDHP) — a type of health insurance with lower monthly premiums but a higher deductible (the amount you pay out of pocket before insurance kicks in). Only people with an HDHP can have an HSA.

If your employer offers health insurance, ask your benefits or human resources office whether they offer an HDHP and whether they have already set up an HSA provider. Many employers choose a specific company to manage their employees' HSAs, and you will be required to use that provider. If you buy health insurance on your own through the marketplace, the insurance company will tell you during enrollment whether an HSA is available with that plan.

Once you are enrolled in an HDHP, the plan administrator or insurance company will either open an HSA for you automatically or send you instructions on how to open one. You do not choose the bank or custodian at this stage — the plan does.

When you might move your HSA to Wells Fargo

If your employer's HSA provider is not Wells Fargo, you can still move your HSA funds to Wells Fargo after the account is open. This is called a trustee-to-trustee transfer. You would do this if Wells Fargo offers better interest rates, lower fees, or investment options you prefer compared to your current provider.

To move an HSA to Wells Fargo, contact Wells Fargo's HSA team and ask for a transfer form. You will provide information about your current HSA account, and Wells Fargo will request the funds directly from your current provider. The money moves without you touching it, so there are no tax penalties. The transfer usually takes one to two weeks.

Before you transfer, compare Wells Fargo's HSA fees with what you are currently paying. Wells Fargo charges a monthly custodial fee for HSA accounts, and the exact amount depends on the account type and whether you use investment options. Ask Wells Fargo for a fee schedule in writing so you can decide whether the move makes sense for your situation.

Investment options if you use Wells Fargo for your HSA

If you move your HSA to Wells Fargo, you can choose to keep the money in a savings account earning interest, or you can invest it in mutual funds or other securities through Wells Fargo's investment platform. Many people invest HSA funds because the money can grow tax-free and you can withdraw it tax-free for medical expenses at any time in the future.

Wells Fargo offers a range of mutual funds for HSA investment accounts, but you will pay investment fees on top of the custodial fee. If your HSA balance is small, the fees may outweigh the benefit of investing. If your balance is larger and you plan to keep the money invested for several years, investing through Wells Fargo may make sense.

What you can use HSA money for

An HSA is designed to pay for medical expenses that your health insurance does not cover or that you pay out of pocket. You can use HSA funds for doctor visits, prescriptions, dental work, vision care, mental health treatment, and many other health-related costs. You can also use the money to pay your health insurance deductible or copayments.

If you use HSA money for a non-medical expense before age 65, you will owe income tax on that withdrawal plus a 20 percent penalty. After age 65, you can withdraw money for any reason without the penalty, though you will still owe income tax on non-medical withdrawals. This makes an HSA a powerful long-term savings tool if you do not need the money for medical expenses right away.

Comparing Wells Fargo to other HSA custodians

Wells Fargo is one option for holding an HSA, but it is not the only one. Other banks and financial companies offer HSA custodial services, and some charge lower fees or offer better interest rates. Before you move your HSA to Wells Fargo, get fee information from at least one or two other providers so you can compare.

Some HSA providers specialize in HSAs and may offer features that general banks do not, such as a debit card that works at pharmacies and medical providers, or lower fees for small balances. Your current HSA provider may also be competitive on fees even if it is not a major bank. The best choice depends on your balance, how often you withdraw money, and whether you want to invest the funds.

Frequently Asked Questions

Can I open an HSA with Wells Fargo if I do not have health insurance yet?

No. You must be enrolled in an HDHP to open or contribute to an HSA. Wells Fargo cannot create an HSA for you without proof of HDHP enrollment. If you are looking for health insurance, you can explore plans through your employer or the health insurance marketplace.

What happens to my HSA if I leave my job?

Your HSA belongs to you, not your employer, so you keep it even after you leave. You can leave the money with your employer's HSA provider, move it to a different provider like Wells Fargo, or move it to a new employer's HSA plan if your new job offers one. The money is always yours to use for medical expenses.

Does Wells Fargo charge a fee just to hold my HSA?

Yes, Wells Fargo charges a monthly custodial fee for HSA accounts. The fee varies depending on the account type and whether you use investment services. Contact Wells Fargo directly or visit their website to see the current fee schedule for HSA accounts.

Can I use my HSA debit card at any store, or only medical providers?

If Wells Fargo issues you an HSA debit card, it will only work at pharmacies, medical providers, and other merchants that accept HSA cards for may be able to access medical expenses. You cannot use it like a regular debit card at grocery stores or restaurants. Some HSA providers do not offer debit cards at all, so ask Wells Fargo whether one comes with your account.