Tips on How to Spend Your FSA So You Don't Lose It
If you have a flexible spending account, you only have a finite amount of time to use the funds you contribute. While employers can provide grace periods and rollover options, these accounts are often "use it or lose it."
Fortunately, there are many ways to spend your FSA before that expiration date hits! But how do FSAs work, and what can you use your funds on?
How Do FSAs Work?
An FSA is an employer-sponsored benefit allowing employees to contribute pre-tax dollars with every paycheck for qualified medical expenses. There's an annual limit to how much money you can put into your account, and you can only use the funds to pay for costs outlined by the IRS.
Furthermore, those funds typically expire at the end of the year. If you don't spend them, they go back to your employer.
Spending Your FSA Funds
Spending your FSA is usually easy if you have doctor appointments, prescription medications, dental care and other services throughout the year. But if you rarely use it, you might scramble at the end of the year to avoid losing your contributions.
Here are a few ideas on what you can use leftover FSA funds for at the end of the year.
Stock Up on Essentials
Did you know you can use your FSA to buy over-the-counter products? Headache medicine, pain relievers, decongestants, antacids, menstrual products and more all count as qualified medical expenses.
Why not stock up? You can spend that last bit on products you'll likely use next year, ensuring you never run out.
Buy New Sunglasses
You can also use your FSA to pay for optometry services and products. If you have prescription lenses, consider buying a new pair of sunglasses. Pick up a new stylish pair you can use when summer rolls around!
Try a New Service
FSAs cover all your typical healthcare services like doctor's visits and specialist care. However, you can also use those funds on less traditional services like acupuncture or chiropractic services.
Try those services if you have aches and pains. It's a great way to use up your FSA funds while seeing if you like the experience.
Read a similar article about is an FSA worth it here at this page.