Maximize Your FSA or HSA: Year-End Tips and 2025 Planning Strategies
Flexible Spending Accounts (FSAs) and Health Savings Accounts (HSAs) are valuable tools for managing healthcare expenses and saving money. As a veteran or member of a military family, these accounts can play an essential role in your financial readiness.
Here’s how to maximize your FSA or HSA before year-end and how to plan ahead for 2025 to support your unique needs.
1. Use Your FSA Funds Before They Expire
Most FSAs follow a “use it or lose it” rule, meaning unused funds may not carry over into the new year. Some plans offer a grace period or allow a portion to roll over, so confirm your plan details.
Eligible expenses may include:
- Copays for medical visits
- Prescriptions or over-the-counter medications
- Vision care, such as eyeglasses or contact lenses
- Dental care
If you or your family need new glasses, dental work, or to restock on healthcare supplies, now’s the time!
2. Leverage Your HSA for Flexibility and Savings
HSAs allow funds to roll over indefinitely, making them a versatile option for veterans and military families. You can use these accounts to pay for qualified healthcare expenses now or save for future medical costs, such as unexpected procedures or retirement healthcare needs.
Key eligible expenses include:
- Deductibles, copays, and prescriptions
- Vision and dental care
- Adaptive equipment and supplies
How FSAs and HSAs Can Support Veterans in 2025
1. Reduce Taxable Income
Contributions to FSAs and HSAs are tax-advantaged, meaning they reduce your taxable income. This can be especially helpful if you’ve transitioned to civilian employment or are managing a tighter budget.
2. Plan for Predictable Expenses
Use these accounts to prepare for known healthcare costs, like regular prescriptions or planned procedures. Planning ahead ensures you have funds set aside for when you need them.
3. Build Wealth Through Your HSA
If you have an HSA, think beyond immediate healthcare needs. HSAs can act as a powerful savings tool for retirement, offering a triple tax advantage: tax-free contributions, tax-free growth, and tax-free withdrawals for qualified expenses.
Reflect and Adjust for the New Year
As you look ahead to 2025, think about how life changes may impact your financial plan. Consider:
- A new job or changes in employment status
- Adding family members
- Adjusting to health changes or new medical needs
Taking time to reflect on these changes can help you determine if your FSA or HSA contributions are aligned with your family’s needs and financial goals.
Adjusting your plan now ensures you’re prepared for the year ahead.
FSAs and HSAs are powerful tools to manage healthcare costs, reduce stress, and build financial security. Whether you’re focusing on current health expenses or looking to the future, these accounts can help you achieve your goals.
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Veteran Saves is here to support you in taking small, consistent steps toward financial confidence.