The tax advantages of a health savings account (HSA) are unbeatable — better than a 401(k), traditional IRA, Roth IRA or 529 savings plan. It can be used like a checking account to pay for medical bills as they arise, as an investment account to prepare for health care costs down the road or as a combination of the two.

An HSA is a savings account that lets you set aside pre-tax dollars to pay for health care expenses. Unlike flexible spending accounts (FSAs), money in an HSA carries over from year to year. To qualify for an HSA, you must have a high-deductible health plan (HDHP). Beginning January 1, 2023, the minimum deductible is $1,500 for individuals and $3,000 for families.

When shopping for an HSA, it’s important to consider account fees, investment options, minimum balance requirements, account accessibility, interest rates and customer service.  Depending on how you plan to use the HSA, certain account features will matter more to you than others.

To help you in your search, Bankrate has compiled a list of the best HSA accounts of 2023. To narrow our choices, we compared fees, balance requirements, investment choices, interest rates and account accessibility of more than a dozen top HSA providers.

The best HSA accounts in 2023

  • Best overall: Lively.
  • Best for investment options: Fidelity Investments.
  • Best for short-term spending: HealthEquity.
  • Best HSA offered by a traditional bank: Bank of America.

Best HSA overall: Lively

Lively gets the nod for best HSA overall for individuals largely because there are no hidden fees to cut into your savings. Some HSA providers make it hard to find interest rates and other account details on their websites, forcing people to call or email for information. Lively’s website is simple, easy to follow and provides relevant details in plain view.

In addition, customers have access to lots of commission-free investments online through a self-directed brokerage account with Charles Schwab, which charges no fee for balances of $3,000 or more and $24 for balances below that. The other investment option is a guided portfolio by Devenir, which comes with an annual fee of 0.5 percent, but there is no cash minimum to invest in it.

Like many HSAs, a Lively HSA comes with a free debit card to pay health care expenses. It also offers online banking and a mobile app that lets you track and manage the account from anywhere. The website is easy to navigate and features an HSA guide and lots of informative articles, calculators and videos. Cash balances in a Lively HSA are FDIC-insured and earn interest. The annual percentage yield starts at 0.01 percent and increases by balance tiers, with the highest tier of over $10,000 earning 0.1 percent. Lively also offers streamlined HSA administration to employers.

Best for investment options: Fidelity Investments

Fidelity Investments offers many low-cost HSA investment options with no account fees and no minimum to open the account. You can invest in stocks, bonds, ETFs, CDs, mutual funds and other options. Online U.S. stock and ETF trades are commission-free, but there may be underlying fees for certain investments. Fidelity also has fund options that are just for Fidelity HSA customers. Account holders can manage their own investments, opt for a managed account or open both a self-directed HSA (Fidelity HSA) and a managed HSA (Fidelity Go HSA).

Accessing HSA funds and paying medical bills is easy with a Fidelity HSA. Customers get a debit card and online bill pay, or they can reimburse themselves for expenses paid by transferring funds from their HSA to their personal bank account. Fidelity also offers calculators, tools and market research to help you monitor and manage your account.

Best for short-term spending: HealthEquity

HealthEquity is a nonbank HSA custodian and one of the largest HSA providers. It’s a good choice for customers who need to use their HSA regularly for medical expenses because of the multiple ways available to spend and track the account. Account holders can access their funds with a debit card, by writing checks, through online banking or with the mobile app.

The HealthEquity mobile app lets you send payments and reimbursements, view the status of claims, take pictures with your device to initiate claims and payments and link debit card transactions to claims and documentation. There is a required 0.36 percent annual investment fee, capped at $10 a month.

Based in Draper, Utah, HealthEquity also offers 24/7 customer support by phone or live chat. HealthEquity savers do earn some interest, based on balance tiers, though those rates are not disclosed on the website. Savers are FDIC-insured up to federal limits.

Best HSA offered by a traditional bank: Bank of America

Many people like the convenience of managing all their finances with one bank. Bank of America, the second-largest bank in the U.S., with over 4,000 branches and about 16,000 ATMs, combines broad physical access with a full suite of digital and online tools. It’s a good choice for people who prefer having a nearby bank branch as opposed to doing everything online.

You can submit claims and monitor the HSA through BofA’s member website or via the MyHealth BofA mobile app. The HSA comes with a Visa debit card with no transaction fees. It offers a savings calculator and customers have 24/7 support by phone or online chat. The bank also provides guidance and education in matching financial strategies with health and wellness goals.

Savers earn interest at tiered rates, with the highest rate, 0.07 percent APY, offered on balances of over $25,000. Investors have dozens of Merrill Lynch (a subsidiary of BofA) mutual funds to choose from. There is no balance minimum to invest and a standard monthly account fee of $2.50 a month (which may be waived if the HSA is through your employer). BofA does not charge transaction fees to buy or sell investments, but there are internal expenses with mutual funds. BofA is also an HSA custodian for small and large businesses.

How to choose the best HSA

There are advantages to opening an HSA through your employer, if it’s available. With an employer-provided HSA, you can reduce Social Security taxes, and your company might contribute to your account.

“In some cases, employer plans can get a better price point, but maybe you can’t get it for free on your own,” says Eric Remjeske, founder and president of Devenir, a Minneapolis-based HSA investment advisor and research firm. HSA shoppers might find Devenir’s HSASearch tool helpful.

If you decide to shop for an HSA, here’s what to consider.

  • Decide how you will use the account. Knowing how you intend to use an HSA — whether for immediate and near-term medical expenses or as an investment account for future health care costs — will help you narrow your options.
  • Watch out for fees. Always ask for a complete schedule of fees before you make a decision, as HSA fees vary greatly among providers. There may be maintenance fees, investment fees, paper statement fees and per-transaction charges. Some HSAs charge a fee to open the account, obtain, replace or renew a debit card or transfer money from a savings account to an investment account. HSAs may also have overdraft fees or nonsufficient funds fees.
  • Inquire about minimum balances to open or invest in a HSA. Some HSA administrators waive fees if an account meets a balance threshold. Ask whether the fee waiver is based on a minimum savings balance or a combined savings and investment balance. Minimum balance requirements to invest usually range between $500 and $3,000.
  • Compare interest rates. Much like a traditional savings account, HSAs offer an opportunity to earn interest. For savers who plan to maintain an HSA as a spending account, rates are something to look at.
  • Make sure HSA funds are easily accessible. When health care bills arise, you need to be able to get to your HSA funds to pay them. Find out whether the HSA comes with a debit card, online bill pay or checks. Find out how easy or difficult it is to transfer funds out of the account to your personal checking, for example.
  • Make sure investment options are diverse and strong. Some HSAs offer the chance to invest and grow the funds. HSA custodians offer a mix of mutual funds, stocks, bonds and other investment products. Look for investment options that charge low fees and don’t have balance thresholds to meet before you can invest. Look for varied investment options with a good performance. Keep in mind that stocks, bonds and other investments are not federally insured.
  • Savers, choose a federally insured institution. If you plan to keep your HSA in a spending account, make sure the bank or credit union you select is insured by the Federal Deposit Insurance Corp. or the National Credit Union Share Insurance Fund. If your financial institution were to fail, you would be covered for up to $250,000.
  • Evaluate the customer service. Make sure the bank, credit union or HSA custodian answers all your questions and tells you everything you need to know to make informed choices. Find out about customer service hours and tools that can help you track and manage your account, such as mobile apps. Some financial institutions are better at offering educational videos and articles online. If you prefer an in-person experience, inquire about branch locations and hours.

Methodology: Bankrate looked at account fees, cost and variety of investment choices, minimum balance requirements, account accessibility and interest rates for more than a dozen of the largest HSA providers, giving the most weight to fees and investment opportunities.

— Bankrate’s René Bennett contributed to an update of this story.