If you set aside money in a flexible spending account this year, you already know the drill: use it or lose it.
What trips people up is the deadline itself, which is rarely as simple as December 31.
Most employers give you until the end of the calendar year to spend your 2024 funds, but many offer a grace period that pushes the cutoff into mid-March.
Others use a carryover rule instead, letting you roll a limited amount into next year.
The catch is that these options aren't guaranteed — your plan either has one, both, or neither, and only your benefits administrator can tell you which.
Here's the part that catches people off guard: the deadline that matters is when the expense happens, not when you file the claim.
You can usually submit receipts for 2024 services well into the spring, but if the care or purchase happened after your plan's cutoff, that money is gone.
So the real clock is ticking now, not at tax time.
A few practical ways to drain a balance before it evaporates.
Schedule that dental cleaning, eye exam, or annual physical you've been putting off.
Stock up on eligible over-the-counter items if your plan still covers them — think bandages, contact lens solution, thermometers, and allergy medicine.
Prescription glasses and sunglasses often qualify, and so do hearing aids and many menstrual products.
If you're close to the finish line but not quite there, a dependent care FSA works differently and covers things like daycare, after-school programs, and summer day camp.
That money can be easier to spend if you have kids, since eligible expenses pile up fast.
One warning worth repeating every year: don't buy things you don't need just to avoid forfeiting a balance.
Spending $300 to rescue $200 is still a loss.
Run the math on what you'd actually use before you raid the pharmacy aisle.
Also worth a phone call: ask whether your plan allows a mid-year change if you've had a qualifying life event like a marriage, birth, or job change.
Those windows can let you adjust your contribution, though they won't extend the spending deadline itself.
The average worker forfeits somewhere in the low hundreds of dollars each year, according to benefits industry surveys, and it's almost always because the deadline snuck up.
Set a calendar reminder for two weeks before your plan's cutoff and treat it like a bill that's due.
Our take: the FSA is one of the few tax breaks that rewards a little paperwork, but it punishes procrastination harder than almost anything else in a household budget.
Check your plan documents today, not in April when you're already filing.
Final Thoughts
A 15-minute call to HR could easily be worth a couple hundred dollars.