How to maximize your end-of-year healthcare savings
BIRMINGHAM, AL (WBRC) -We’re just over two weeks away from the end of this year, and before you head off to grandma’s house for the holiday, you may need to make sure you’re not losing money you’ve set aside for healthcare expenses this year.
The first step to making sure you max out your healthcare dollar at the end of the year is making sure you know what you have.
If you’ve been putting money aside into a special account all year for healthcare, it could be a health savings account (HSA) or a flexible spending account (FSA), and there’s a big difference: the FSA money goes away at the end of the year whether you use it or not, the HSA doesn’t.
“You don’t need to spend it. Keep it in your account, you can invest it, you don’t need to rush off and spend the money,” recommends Steve Neeleman, founder of HealthEquity.
A national survey found the average consumer loses about four percent of their healthcare savings, or about $60 each year, and that adds up to almost $200 million nationally.
Even if you have the FSA, check with your employer or HR rep, because some plans give you a one or two month grace period in the New Year to use that money.
If you’ve got money to spend, you can stock up on supplies like contact lens solution in bulk, or get an extra refill of prescriptions.
“If you can load up on that and it doesn’t have an expiration date, that’s a great way to take care of that money,” Neeleman recommends.
If you have an HSA account, this is a great time to use that as a place to cut your tax bill.
“Every dollar you put into the HSA account up until tax filing day will decrease your income for the year,” Neeleman says. “So if your accountant in early January says ‘you know what, you’re going to have to pay some taxes,’ ask them ‘Can I put more money in my HSA because that’ll decrease my tax liability?’ that’s just free money.”
If you have a high-deductible health insurance plan and you've already met that deductible for the year, now's the time to schedule any checkups or visit to a specialist you've been putting off.
“Sometimes you gotta be careful with that, because some people go crazy and next thing you know they get an unnecessary surgery just to save some money and it costs a lot more in the long run,” Neeleman warns.
Here is a site where you can buy supplies with your HSA money.
And here are some tips on maximizing your FSA dollars before they disappear.
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