Does the balance in your HSA account need to stay below the maximum contribution at all times, even when the amount rolls over at the end of the year?
I understand that the maximum I can deposit into my health savings account (HSA) for 2018 is $6,900 for my family. Is this the maximum amount that can be in my HSA account at any given time, or just the amount that I can contribute per year? The money will roll over into 2019. Do I need to keep my balance at or below $6,900 at all times?
No, absolutely not. That is the most you can contribute but you could have $100m in there and it not be an issue. HSA's are the only triple tax-advantaged account out there, meaning contributions go in pre-tax, any balance can grow tax-free, and you can take money out for qualified medical expenses tax-free. You can also invest the funds. Your particular plan will dictate what the minimum balance is to be able to invest, but what we often recommend is to make the maximum contribution, invest the balance, and pay for any minor medical expenses out of pocket. Your HSA is completely portable and you retain control of the funds at all times. Although you can only contribute to it as part of payroll deductions and as a participant in your employers high deductible health plan, you can still keep those funds even after you leave your employer. But to answer your question, you can't contribute more than the annual max, but there's no limit on the balance of the funds held within the account.
No, you don't need to keep your balance below the annual contribution limit. In fact, one of the great benefits of an HSA is the ability to carry over unused balances to subsequent years. These funds can be invested, including low-cost index funds, for years and the income is tax free if used for medical expense reimbursement. I recommend (and do myself!) that you keep copies of your medical receipts each year, then reimburse yourself many years or decades in the future when you may need additional cash flow (like in retirement).
Keep contributing and building your HSA balance!
Great question....there is no limit to how much you can have in your HSA account. Some people are using these an another type of retirement account - investing the funds and letting the money grow for what they assume will be larger medical expenses in retirement.
Best of Luck