Millions of American workers are staring down a deadline that costs real money to ignore.
If you have a flexible spending account through your job, the funds you set aside for 2025 may vanish if you don't spend them by the plan's cutoff — and for many people, that cutoff lands in early March.
Unlike a savings account, an FSA is a use-it-or-lose-it arrangement.
You decide during open enrollment how much to tuck away pre-tax, the money gets deducted from each paycheck, and then you have to claim it back through receipts for eligible expenses.
Whatever's left when the clock runs out typically goes back to your employer.
The average account holder forfeits somewhere in the range of $300 to $500 a year, according to benefits industry estimates.
Multiply that across roughly 30 million accounts, and the unspent total runs into the billions annually.
That's not a rounding error for a household watching grocery bills and rent.
Some plans offer a grace period of up to 2.5 months, while others allow you to carry over a limited amount into the next year.
The catch is that the rules vary by employer, and plenty of workers never check which version they're under.
A quick call to HR or a look at your benefits portal settles it in minutes.
What counts as eligible is broader than most people assume.
Prescription copays, eyeglasses, contact lenses, dental work, bandages, thermometers, and even some over-the-counter medicines qualify.
Sunscreen, menstrual products, and breast pumps have been added in recent years.
Many retailers now label FSA-eligible items directly on shelf tags and product pages, which makes last-minute spending far less guesswork.
A few practical moves can rescue a balance before it disappears.
Book that dental cleaning or eye exam you've been putting off.
Stock up on eligible household health items through an FSA store, which verifies eligibility up front and issues the receipt you'll need.
If you wear glasses, a backup pair is a legitimate use of the funds.
One warning worth repeating: you can't cash out an FSA, and you can't move the money into a retirement account.
The deadline also creates a planning question for next year.
If you consistently forfeit a few hundred dollars, you're probably electing too much.
Estimate your predictable medical costs, add a cushion for the unexpected, and set your contribution there rather than aiming for the maximum out of habit.
One more wrinkle: if you leave your job mid-year, your access to the account usually ends on your last day, even if you've already contributed the full amount.
That's the opposite of how a health savings account works, which is why HSAs are generally the better long-term home for medical money if you're eligible for one.
Our take: the FSA deadline is one of the few financial dates where a couple of hours of admin work produces a guaranteed return.
Ignoring it means paying taxes on money you never got to use, which is the worst of both worlds.
Final Thoughts
Check your balance today, not the week it expires.