Consumer Tips, Tricks & Articles

Use It Or Lose It – What to Do With Your FSA

Many employees take advantage of the flexible spending accounts offered by their place of employee in order to save money in the event of a medical emergency, for check ups, medical co-pays, and other medical situations that maybe health insurance just does not cover.

FSA's are part of a company's benefits package where employees have a set amount of money taken out from automatic payroll deductions which is then allocated to the employee's flexible spending account. The deductions for the FSA monies are made on a pre-tax basis with is a plus, as that means you are not paying any taxes on that amount of income.

Flexible spending accounts can certainly come in handy, especially during an medical emergency or an unexpected medical situation. The bad side of flexible spending accounts is that no matter how much money you have put aside into your account throughout the year, you will likely lose it if you don't use it by the end of December. With most flexible spending accounts, there is no option for carry-over of funds into the next year so many people will end up just flat out losing that money, which can be accumulate quite nicely over the previous twelve months. In some cases, the rules have changed and you are allowed to make claims for up to 45 days after the end of the year, meaning you have until March 15th to make some appointments with the medical community.

So what should you do if you still have some money in a flexible spending account? If you act now, you can probably still squeeze in some appointments before the end of the year is up. Here are some suggestions for spending your funds.

Dental Work

This may be a good time to invest in any dental work that is more than minor but still covered under the FSA requirements. For instance, cosmetic and elective dentistry such as teeth whitening is not allowed but you can use your money to have your teeth cleaned.

Vision Services

You should be getting your eyes checked at least every two years and now is a great time to get your vision checked, your eyeglass prescription changed, your contact prescription evaluated, or just a general eye health exam. You can also use your flexible spending account to get LASIK eye surgery or an extra pair of glasses you might not otherwise be able to afford.. The FSA can really come in handy when vision plans are not part of your standard benefits package.

Medical Exams

Seeing your family physician for yearly physical exam is always a good idea. Even though we are often too busy to make such appointments, perhaps losing a bunch of money will be a good enough motivator to check in with your health.

Prescriptions

If you are running low on any of your prescriptions, you can use your FSA money to pay co-pays on medications or even for over the counter medications. Stock your cabinet with cold medicines, headache and pain relievers, and any other medications you will typically use throughout the year.

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