Innovation & Insights

Make the most of your HSA or FSA

10 December 2025

Medical expenses might not be top-of-mind during the holiday season, but now is the perfect time to check in on your health savings accounts. Depending on the type of account you have, you may need to use your funds before the year ends. Here’s what to know about Health Savings Accounts (HSAs) and Flexible Spending Accounts (FSAs), and how to make sure you’re not leaving money on the table.

HSA and FSA – What’s the difference?

HSAs and FSAs both allow you to set aside pre-tax dollars for qualified health expenses, but they work differently. Here’s how:

Flexible Spending Accounts (FSAs)

Managed through your employer and not tied to a specific health plan.
Funds generally must be used by the end of the plan year. Some employers offer a grace period or allow a small rollover, so be sure to check your plan details.
Any unused dollars may be forfeited, so it’s helpful to review your balance before December 31.

Health Savings Accounts (HSAs)

Only available to those enrolled in a qualified high-deductible health plan.
Funds never expire – you can save and use them anytime, even years later.
HSAs are portable, meaning the balance stays with you if you change jobs or health plans.
You can also invest your HSA dollars, allowing your savings to grow over time.

How can you use HSAs and FSAs?

Both HSAs and FSAs can be used to pay for many everyday healthcare needs such as doctor visit co-pays, prescriptions, diagnostic tests, and certain medical supplies.

There are also many eligible items people don’t always realize qualify, including:

Sunscreen
Contact lenses and solution
Prescription glasses
Menstrual products
First-aid items
Certain over-the-counter medications

Be mindful not to buy large quantities of the same item. IRS rules don’t allow FSAs to be used for stockpiling, and purchases must be for medical care needed in the current plan year.

If you’re unsure whether a purchase qualifies, check your plan’s list of eligible expenses or look for an online HSA/FSA eligibility guide.

Still have FSA dollars to use?

If you have an FSA, there’s still time to make use of your remaining balance before year-end. A few ideas:

Review any outstanding healthcare bills and submit eligible expenses for reimbursement.
Schedule appointments you’ve been putting off, such as annual check-ups, physical therapy, dental cleanings, or vision exams, if you can get in before your plan deadline.
Replenish eligible over-the-counter items you know you’ll need soon.

Staying proactive now can help ensure you get the full value of your benefits this year.

What’s new for 2025?

There are a few important IRS updates for 2025 that may affect how you use your HSA or FSA.

For FSAs, the annual contribution limit has increased to $3,300. If your employer offers a rollover option, the maximum amount you can carry into the next plan year has increased to $660. Keep in mind that not all employers offer rollover, and some use a “use-it-or-lose-it” deadline or give a short grace period. Check your plan to confirm.

For HSAs, the annual contribution limit is now $4,300 for individuals and $8,550 for families. To qualify for an HSA, you must be enrolled in a high-deductible health plan (HDHP). For 2025, the minimum deductible is $1,650 for individuals and $3,300 for families.

HSA contribution limits will increase again in 2026, so if you’re planning ahead or budgeting for future health needs, it may be helpful to review next year’s limits during open enrollment.

These annual updates can help you save more on healthcare costs and make the most of the tax-advantaged benefits available to you. Reviewing your balance and plan details now can help ensure you’re ready for the year ahead and not leaving any money unused.

Who can you talk to about your HSA or FSA?

If you have questions about your HSA or FSA (such as what’s covered, how to submit a claim, or how much you can contribute) there are a few places you can turn. First, your employer’s benefits team. This is often the best first stop. They can explain your specific plan rules, deadlines, rollover options, and any grace periods.

Second, your HSA or FSA administrator. Many accounts are managed through a bank or benefits administrator. Their customer service team can answer questions about eligible expenses, card issues, reimbursement requirements, and your current balance.