HSA space as part of PP? Looking @ Dreyfus s&p 500 index mutual fund

[murphy_p_t]

since my bank's HSA doesn't offer gold, LTT, or T bills, I'm looking @ buying the Dreyfus S&P 500 index, (PEOPX, 0.5% Expense ratio...not the greatest). My thinking is that I'm using tax deferred space while keeping my investments in line with the PP. In particular, I don't want to keep it just cash as the interest rate is so low & I don't want to rely on FDIC.

Questions:
1. any better HSA providers that you've found which closely correlate w/ one or more of the PP components?
2. any concerns/reservations with Dreyfus mutual fund in particular? I know the ER isn't the best & HSAs have fees, but I'm looking to minimize counter-party risk. I'm just getting started on this, so I thought I'd throw it out there. Even if bank fails, I should still have my shares?

[murphy_p_t]

well, learning about the HSA market:
-my credit union doesn't offer any investment options, just cash holding
-my local bank, as mentioned, offers Dreyfus index fund...btw, my local bank is rated D+ by Weiss Research
-5/3rd Bank offers HSA with Vanguard index fund option...Weiss ranks 5/3 slightly better than local bank & its a Fed Reserve member bank...maybe this is safer bet?

I'm still hoping to get some feedback on using HSA space as "deep"  stock holding for my PP

[KevinW]

A company called HSA Administrators ( http://www.hsaadministrators.info/ ) offers Vanguard funds including Prime Money Market and Total Stock Market, which are low-cost options for cash and stock, respectively.  I've never done business with them so do your own due diligence.

Another angle is to look for a brokerage-style HSA that allows you to buy PRPFX.

In principle I think HSA space is OK as "deep" storage.  However the spirit of an HSA is that the money is earmarked for health care spending, and stocks are volatile.  I'd worry that you might need to withdraw from the HSA during a stock bear market and would come up short.  So if it were me I'd hold cash or a complete PP in an HSA.

[WildAboutHarry]

HSA Bank has a TD Ameritrade brokerage window.

Fees are OK (you can avoid the fees by keeping $5,000 with the bank), and TD Ameritrade does offer a bunch of no-transaction fee ETFs (SHY, TLT, VTI, etc.).

I've used HSA Administrators in the past.  Their fees are also OK, the fund selection is somewhat limited, but their service was quite good.

Note that OK fees are a relative concept.  HSA fees in general seem a bit heavy.

[TripleB]

Look for a credit union that offers no-fee HSA to keep money in an NCUA insured cash account and consider that deep storage for the cash asset.