Giving Away Free Money

Not Spending All of Your FSA is Like Giving Away Your Money for Free

Dec 02, 2019

What happens to your FSA dollars at year end? As the end of the year fast approaches it’s important to know what your Flexible Spending Account (FSA) year-end options are.  Unlike Health Savings Accounts (HSAs), FSAs are “use it of lose it” accounts, meaning at the end of the calendar year if you have money still left in your FSA, as of December 31st you may lose that money.  According to a Business Insider article posted in October 2019, the FSA Store reported that it is estimated that more than $400 million is forfeited every year in FSA dollars. It’s like giving away your hard-earned income for free. 

Plan Options can Offer Some Relief

If you have an FSA it’s important to understand all of your plan details and deadlines.  Many plans may offer one of the two following features to give you some options for dealing with year-end unspent funds:

Rollover – allows participants to roll over $500 of their FSA money to the next year. In 2019 the contribution limit was $2,700, and in 2020 that limit is increasing to $2,750.

Grace Period – allows for 2.5 extra months after the end of year deadline for participants to incur and pay for expenses with FSA dollars contributed from the previous year.

How to Learn More

If you are unsure as to whether your plan offers one of the above features check with your employer or FSA plan administrator.

If you have FSA dollars that need to be spent before your plan deadline, the FSA Store online is a great place to start.  They have over 4,000 FSA-eligible products plus educational resources at the click of a mouse.

Hannie Spitzack is a HSA Sales Relationship Manager with