What exactly is a Health care FSA?  It is an account that lets you set aside pretax money to pay for qualifying health care expenses.  Qualifying expenses include doctors visits, dental care, vision care, and even some over the counter medications.

So, now that you know what it is, can it help you save money?  The answer is yes.  Participating in a Health care FSA can save you money because the money that you have taken out of each paycheck comes out before federal, social security, and state taxes are taken out.  That means that you save the amount that you would normally pay in taxes.  Another great advantage is that the money is taken out throughout the year, and not in one large sum.

I am sure that you have heard the saying, “out of sight, out of mind” well that fits perfectly.  This can really come in handy when money becomes tight, but you still have that co-pay at the doctors office.  Use the FSA to pay the co-pay, and you can keep your cash in your pocket.  They are also very useful at the beginning of the year when you have to meet your deductible.

If you are debating on how much to contribute to your health care FSA, you may want to calculate the total of your deductibles for the year.  If you can set aside enough to pay your yearly deductibles, that will definitely help out with your family budget.

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