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Flexible Spending Account

September 12th, 2013 at 02:01 pm

I'm sure most all of you frugally minded SA bloggers take advantage of your Flexible Spending Account, if your or your spouse's employer offers one. My employer offers an FSA, and I sure take advantage of it.

For those of you who may not know what an FSA is, it's an opportunity for an employee to defer some income into an account. The money in the account must be used for approved medical expenses. The money deferred to the FSA is not taxed. The catch is that if you don't claim the money over a 15 month period (Jan-Mar), you lose it. Forever.

An FSA is like a HCSA for W-2 employees.

The reason I bring it up, is I just submitted an FSA claim. Over the past couple of month, I've polled three of my colleagues about their participation in the FSA. Their responses are a mixed bag:

One colleague participates

One colleague is aware of the FSA, and chooses not to participate. He's afraid of losing his money at the end of the year.

One colleague had no idea what an FSA is.

So, based on my completely unscientific, informal, and extremely limited poll, 50% of employees in my organization participate in the FSA, 25% are aware of it, and choose not to participate, and 25% are unaware of the FSA.

As for me, I have $100 per month deposited into the FSA. My claims paid to date are $394.44. Today I submitted $110.20. That gets us caught up through July.

If you do not participate in an FSA (or HCSA), I urge you to look into it.

Posted in Personal Finance | 3 Comments »

3 Responses to “Flexible Spending Account”

  1. creditcardfree Says:
    September 12th, 2013 at 02:25 pm 1378995953
    1378995953

    I agree FSAs are a really good deal. I would always suggest to someone to start with less than they think they might use for medical/vision, just to get the hang of it and not worry about losing any money. Since we are military this is not an option for us, but we do have other decent medical benefits, so no complaints.

  2. Miz Pat Says:
    September 12th, 2013 at 08:57 pm 1379019461
    1379019461

    I had one in the past, but i love my HSA now, because it has about 2K in it. I love the tax break.

  3. Jenn Says:
    September 13th, 2013 at 08:23 am 1379060584
    1379060584

    I use my FSA too. Since I have one kid who wears glasses/contacts, I stock up on contacts or buy an additional pair of glasses at the end of the year if there's money left. I've never lost a penny!

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