Vanguard announced a partnership with HealthEquity, an independent health savings account (HSA) custodian, to provide defined contribution (DC) plan sponsors and their participants a new service integrating health and wealth planning for retirement.
Vanguard will offer plan sponsors the ability to provide an HSA solution to their employees that features low-cost Vanguard funds or the same investment options as their DC plan line-up.
HSAs can be an effective, highly tax-efficient means to save for health care expenses in retirement. For Vanguard participants who elect to save in a HealthEquity HSA, Vanguard’s Retirement Readiness Tool technology will integrate their HSA information with their DC plan balance and other assets to give them a comprehensive view of their current and future retirement savings. Participants will also benefit from highly personalized communications that are rooted in behavioral finance and proven to successfully encourage their next best action.
“Consumers who learn to use HSAs and DC plans together are on the fast track to retirement readiness. Our partnership with Vanguard offers plan sponsors a powerful solution to connect health and wealth,” says Jon Kessler, president and CEO at HealthEquity.
As a supplement to its new HSA solution, Vanguard plans to introduce a new proprietary health care cost calculator that will help participants to better plan and save for health care expenses in retirement.