Paragon Perspectives: Don’t Let Your Hard-Earned FSA and HSA Dollars Go to Waste: Smart Moves Before Year-End
The end of the year is creeping up, and while you’re busy thinking about holiday shopping, family dinners, and your New Year’s resolutions, there’s one more thing that deserves your attention—your FSA and HSA funds. If you’re not careful, you could be leaving money on the table. And let’s be honest, who wants to do that?
Here’s what you need to know to make the most of your FSA and HSA dollars before December 31st.
FSA vs. HSA: What’s the Difference?
Let’s clear up the confusion. While both accounts are designed to help you pay for medical expenses, they work a little differently.
- FSA (Flexible Spending Account): It’s a “use it or lose it” account, which means any unspent funds by year-end could vanish (unless your employer offers a grace period or rollover option).
- HSA (Health Savings Account): This one’s more of a long-term play. Funds roll over from year to year, so there’s no rush to spend it by December 31. Bonus points for being able to invest HSA funds and let them grow tax-free.
If you have an FSA, time is of the essence. If you have an HSA, you’ve got more flexibility, but there are still smart moves to make before year-end.
How to Use Your FSA Funds Before They Expire
If you have an FSA, now’s the time to check your balance and make a plan. Here are a few simple ways to put those funds to good use:
1️⃣ Stock up on essentials: Buy over-the-counter medications, first-aid supplies, and wellness items like sunscreen, thermometers, and heating pads.
2️⃣ Book last-minute appointments: Need an eye exam, dental cleaning, or a trip to the chiropractor? Book it now—everyone else will be doing the same in December.
3️⃣ Shop online: Websites like the FSA Store have eligible products you can order from the comfort of your couch. No crowded stores, no stress.
Don’t wait until December 30th to check your balance. By then, your options are limited and stress levels are high. Take action today.
Smart HSA Moves Before Year-End
The great news is, you don’t have to “use it or lose it” with an HSA. But you can still take some strategic steps before the new year:
1️⃣ Max out your contributions: Contributions are tax-deductible, so every extra dollar you add before December 31 could lower your taxable income. Win-win.
2️⃣ Plan for future expenses: While you don’t have to spend your HSA funds, you can use them for upcoming expenses like vision care, dental work, or planned medical procedures.
3️⃣ Consider investing: If you have extra funds in your HSA, you may be able to invest them in mutual funds or stocks. It’s like building a retirement fund for healthcare.
Don’t Leave Money on the Table
Your FSA and HSA accounts are powerful tools to manage healthcare costs and save on taxes. But with FSAs, you have to act fast to avoid losing money at year-end. With HSAs, you have the chance to make smart financial moves before 2024 ends.
If you’re not sure where to start, we’re here to help. The team at Paragon Wealth Management can guide you through the process and make sure your hard-earned dollars work as hard as you do.
Call me at 215-543-6576 or email phil@paragon-wealth.com
Don’t wait until the last minute—take charge of your FSA and HSA today. Your future self will thank you! 💪
About Phil Rosenau
As a graduate of Germantown Academy, Phil Rosenau earned his bachelor’s degree in economics at Drew University, while also earning a minor in business management. His passion for creating and maintaining business relationships drove him to join the Prudential Advisors team, where he met Charlie and Ricardo before starting Paragon Wealth together.
Phil is a lifelong resident of Bucks County and the son of a local entrepreneur. He understands the unique needs of small business owners, takes pride in providing his clients with the knowledge to understand their unique financial situation, and helping them navigate their financial future with confidence. He enjoys spending time with his wife, Caroline, and two children, he is the current president of the MDM networking group, and he is active with the local CrossFit community. Phil is also proud to be part of the Drew University Lacrosse Legacy where he played all four years. You can find Phil here on LinkedIn, or here on Facebook.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All investing involves risk including loss of principal. No strategy assures success or protects against loss. There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Any securities mentioned here are for informational purposes only and are not recommendations to buy or sell any security.
Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Great Valley Advisor Group, a Registered Investment Advisor. Paragon Wealth Management and Great Valley Advisor Group are separate entities from LPL Financial.
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