If you have a healthcare flexible spending account through work, there's a decent chance you're sitting on a few hundred dollars that will evaporate at midnight on December 31.
Unlike a bank account, an FSA is a use-it-or-lose-it arrangement.
The average employee elects around $1,500 a year, and industry surveys consistently find a large share of accountholders leave money behind — often because they simply forget the deadline is real.
Here's the frustrating part: your employer already deducted that money from your paychecks.
It's your own wages, and once the plan year closes without a claim, it goes back to your employer.
Some companies use those forfeitures to offset their own plan costs.
So the clock isn't just about convenience — it's about money you already earned.
The good news is that many plans build in a grace period of up to two and a half months, or a carryover of a limited amount into next year.
Your plan document spells out which one applies, and if it's neither, December 31 is a hard wall.
Check your benefits portal or call HR before you assume you have extra time.
Over-the-counter medicines, bandages, first-aid kits, pregnancy tests, contact lens solution, and sunscreen with an SPF of 15 or higher all qualify.
So do prescription glasses, exams, dental cleanings, therapy copays, and many menstrual products.
The pandemic-era rule that let people buy any OTC item without a prescription is gone, but a doctor's note or a prescription can still unlock general health items like vitamins and pain relievers.
If you're scrambling, an online FSA store is the fastest route.
These retailers label every item as eligible or not, so you're not guessing at checkout.
You can also book a dental cleaning, an eye exam, or a therapy session before the year ends — services count on the date you receive them, not the date you pay.
That flexibility alone can absorb a surprising chunk of a balance.
If you use an FSA debit card and the charge gets flagged, you'll need documentation, and that can be requested months later.
Also, don't buy things you'll never use just to zero out the account — that defeats the purpose.
And if you're weighing next year's election right now, remember that under-electing is safer than over-electing, since unused funds don't come back.
One more thing worth checking: dependent care FSAs have their own separate deadline and rules, and they don't cover the same expenses.
If you have both types of accounts, confirm you're looking at the right balance before you start shopping.
Our take: the FSA deadline is one of the few money deadlines where a little planning produces an immediate, tangible payoff.
Ten minutes in your benefits portal tonight could save you several hundred dollars that would otherwise quietly disappear.
Final Thoughts
Set a calendar reminder for mid-December every year — your future self will thank you.