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- Sep 10, 2006
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We have an account with HSA Administrators. They have 20-some Vanguard funds we can choose from to invest in.
Our tenative plan (still investigating) is to use our HSA as needed when retired to cover any medical expenses that put us beyond our yearly budget. If we have a healthy year, no draw downs. If we have a year with large medical expenses, we utilize the HSA as needed.
Given this projected use of our HSA, what type of fund do you think is appropriate to invest in? I would like the fund to grow, of course, but I don't want it to be so volatile that we end up drawing on it during a year when it is down significantly. We have our HSA slotted to be part of our bond allocation in our portfolio right now...
I could just keep it in the money market, but the 10 yr return on that (VMMXX) is only 1.61%.
Other choices, per Morninstar Category:
Intermediate Govt:
VFIJX - GNMA Fund Admiral (10 yr return 4.92%, ER .11)
Conservative Allocation
VSCGX - Life Strategy Conservative Growth Fund (10 yr return 5.52%, ER .15)
VASIX - Life Strategy Income (10 yr return 4.42%, ER .14)
Moderate Allocation
VSMGX - Life Strategy Moderate Growth (10 yr return 6.15%, ER .16)
VGSTX - STAR Fund (10 yr return 7.02%, ER .34)
Aggressive Allocation
VASGX - Life Strategy Growth Fund (10 yr return 6.47%, ER .17)
I am leaning towards the GNMA fund b/c of wanting stability, since we may draw from this account for medical expenses. It looks like the only fund I see that did not have a huge down year over the past 10 years.
Any feedback? Other points to consider?
Our tenative plan (still investigating) is to use our HSA as needed when retired to cover any medical expenses that put us beyond our yearly budget. If we have a healthy year, no draw downs. If we have a year with large medical expenses, we utilize the HSA as needed.
Given this projected use of our HSA, what type of fund do you think is appropriate to invest in? I would like the fund to grow, of course, but I don't want it to be so volatile that we end up drawing on it during a year when it is down significantly. We have our HSA slotted to be part of our bond allocation in our portfolio right now...
I could just keep it in the money market, but the 10 yr return on that (VMMXX) is only 1.61%.
Other choices, per Morninstar Category:
Intermediate Govt:
VFIJX - GNMA Fund Admiral (10 yr return 4.92%, ER .11)
Conservative Allocation
VSCGX - Life Strategy Conservative Growth Fund (10 yr return 5.52%, ER .15)
VASIX - Life Strategy Income (10 yr return 4.42%, ER .14)
Moderate Allocation
VSMGX - Life Strategy Moderate Growth (10 yr return 6.15%, ER .16)
VGSTX - STAR Fund (10 yr return 7.02%, ER .34)
Aggressive Allocation
VASGX - Life Strategy Growth Fund (10 yr return 6.47%, ER .17)
I am leaning towards the GNMA fund b/c of wanting stability, since we may draw from this account for medical expenses. It looks like the only fund I see that did not have a huge down year over the past 10 years.
Any feedback? Other points to consider?