Summary
This conversation provides an in-depth overview of the new Flexible Spending Account (FSA) program being introduced by the Department of Defense (DOD) for military service members. The hosts discuss the benefits, eligible expenses, and key differences between FSAs and Health Savings Accounts (HSAs). They also explore who might benefit most from the FSA, how to estimate out-of-pocket expenses, and the importance of understanding the program's details for effective financial planning. Resources for further information are also highlighted.
Chapters
00:00 Introduction to the Flexible Spending Account
01:42 Understanding Flexible Spending Accounts
05:01 FSA vs HSA: Key Differences
07:49 Details of the New DOD FSA Program
10:28 Who Should Consider the FSA?
15:22 Estimating Out-of-Pocket Expenses
18:30 FSA in the Context of Financial Planning
21:08 Resources and Final Thoughts
Takeaways
The FSA allows service members to set aside pre-tax money for medical expenses.
Eligible expenses include co-pays, dental, vision, and wellness therapy.
The FSA must be used within the year it is contributed, with a small rollover allowed.
FSAs are particularly beneficial for families with higher medical expenses.
Higher tax bracket individuals will see greater tax savings with an FSA.
It's important to track your typical out-of-pocket expenses to make informed contributions.
The FSA is a tool for tax reduction but requires careful management to avoid losing funds.
Administrative costs include the time spent filing for reimbursements.
The FSA Fed site provides a list of qualified medical expenses.
Understanding the FSA's role in overall financial planning is crucial for service members.
Operation Retirement Readiness: www.operationretirementreadiness.com
Schedule a consultation with Mike: https://nextmissionfinancialplanning.com/contact/
Schedule a consultation with Amy: https://www.instarfp.com/contact
Disclaimer: This podcast represents the views of the hosts and any guests. It is for informational purposes only and should not be considered tax, financial, or legal advice. All information is regarded to be from reliable sources. The hosts are not responsible for any losses, damages, or liabilities that may arise from the use of this podcast. This podcast is not intended to replace professional, individualized advice.
