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If you have a Flexible Spending Account (FSA), the end of the year comes with an important reminder: use your funds or risk losing them.

FSAs are a smart way to save on medical and dependent care expenses using your pre-tax dollars. The downside? Most FSA plans follow the “use it or lose it” rule, meaning any unused funds may expire if you don’t spend them by your plan’s deadline. While some employers offer a grace period or limited rollover, not all do, so it’s essential to know your plan’s rules.

The leftover FSA funds are your hard-earned money. Let’s look at some ways to make the most of them before time runs out!

Verify Your FSA Deadline

Before spending your remaining balance, you should confirm the date of when your funds expire. Deadlines vary depending on your employer’s plan:

• December 31^st deadline: Many FSAs require you to spend all funds by the end of the calendar year.
• Grace period: Some plans allow extra time, typically until March 15^th of the following year, to use remaining funds.
• Carryover option: Certain plans let you roll over up to $660 (2025 limit) into the next year.

The easiest way to confirm the deadline is to check with your employer’s Human Resources department or benefits provider to avoid any surprises.

How to Maximize Your FSA Funds

You may be surprised by how many expenses will qualify for an FSA reimbursement. If you still have money left over, consider these common eligible expenses:

• Co-pays, deductibles, and out-of-pocket costs for doctor visits, lab work, or hospital care
• Prescription medications and refills
• Over-the-counter medications like pain relievers, allergy medications, and cold remedies
• Medical supplies and devices such as thermometers, blood pressure monitors, and first aid kits
• Vision and dental care, including glasses, contact lenses, cleanings, and dental procedures

There are also lesser-known eligible expenses, such as acupuncture, chiropractic care, smoking cessation programs, and even sunscreen! Check you FSA plan’s website for a full list of qualifying purchases.

Don’t Overlook Dependent Care FSAs

If you contribute to a Dependent Care FSA, the clock is ticking as well. These funds can be used for:

• Daycare or preschool
• After-school programs
• Other qualifying dependent care expenses

Dependent Care FSA funds generally must be used within the plan year, so be sure to submit reimbursement requests before your deadline.

Smart Strategies to Avoid Losing Money

To make sure no funds go to waste, consider these last-minute tips:

• Schedule any overdue appointments like dental cleanings, eye exams, or specialist visits.
• Stock up on eligible items ahead of the New Year.
• Submit reimbursements early to avoid processing delays and to catch any missing documentation.

The Bottom Line

FSAs are an extremely valuable benefit, but only if you use them. By understanding your plan’s deadlines, knowing which expenses qualify, and taking a proactive approach before the end of the year, you can ensure every dollar you set aside works for you!