An FSA should not be a "bet" it should be set up for expenses you know you are going to need to pay: dependent care, recurring care and prescriptions, planned procedures. Your employer, not you, owns the account and keeps any balance remaining at the end of the year so you should not really guess at how much you contribute. An advantage of the FSA is that the full contribution is available immediately but the payroll deductions are spread over the whole year.

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everforward 2 hours ago | parent | next [-]

Those things are less static than you seem to believe. Eg recurring prescriptions; at least once a year my insurance gets mad about my scripts and requires a pre authorization that occasionally contains a stipulation that I try their “preferred” (read: cheaper for them) alternatives.

My planning is now wrong. Likewise I can only do FSA for planned procedures if I know close to a year ahead of time, which isn’t super likely. What portion of procedures are serious enough that insurance won’t call them elective, but also tame enough that you can put it off for a year for your FSA?

I don’t think I’ve ever had my FSA be completely correct. I’m always either over-stocked and losing money, or under-stocked and paying with post-tax dollars when I don’t have to.

	▲	SoftTalker an hour ago \| parent [-]
		Again, the FSA is for known expenditures, not unknown or variable. It's not perfect and I'm not really even defending it; I think an HSA is generally a better idea but the FSA does have certain specific advantages.

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vel0city 3 hours ago | parent | prev [-]

But for a ton of people that amount is extremely variable. Do you plan on getting into a car accident? Do you plan on getting an appendectomy in June when making your elections the November before? Sorry doctor, getting cancer wasn't in the plans for 2026, can we reschedule that to 2027 after my open enrollment?

I hate FSAs. Anyone have a good argument on why we should have them instead of just making HSAs open to everyone regardless of healthcare plan?

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topgrain2 2 hours ago | parent [-]

Requiring certain healthcare plans to access HSAs is the only thing that keeps HSAs from primarily being (in terms of amount of tax income lost to the program) a benefit for the upper-middle-class and higher, i.e. a regressive redistribution scheme.

Optimal (maximizing your benefit... and also cost in lost tax receipts) use of HSAs requires not touching the money until retirement. You pay medical bills with non-HSA money and keep the HSA money invested and growing tax-advantaged, like an extra retirement account. Spending the money you put in every year offers relatively tiny gains compared to keeping it in those accounts for decades.

Your options to mitigate this are to limit access, or to make it undesirable to keep money in them long-term, approaches to which look kinda FSA-like.

	▲	SoftTalker 32 minutes ago \| parent \| next [-]
		Even if you spend the money you put in to an HSA every year, you still saved the marginal income tax on that money, which is a lot better return than most other short-term "safe" ways you might save for unexpected expenses.
	▲	vel0city 2 hours ago \| parent \| prev [-]
		> to make it undesirable to keep money in them long-term We could just continue to enforce the 20% penalty indefinitely to get rid of the concept of these accounts turning into retirement accounts. FSAs benefit the upper-middle-class and wealthy more than poor people as well. You'll see quite a bit more savings when your top end tax rate is 35% than 12%. They're also far more likely to be able to plan on setting aside some portion of their incomes into a FSA at enrollment time rather than the bigger effects of the gamble with lower income earners; the outcomes of the risk of overfunding is way more impactful for someone making little money. The tax benefit helping the wealthy more seems to me to move more towards eliminating the tax advantages of healthcare spending entirely.