As a 22 year old recently out of the confines of college life, the grown up world comes at you fast. Now I realize the importance of turning off unused lights, utilizing websites to find the proper time and location to fill up my tank, and furthermore, why my parents cooked dinner most nights despite the chants coming from the backseat “Mc-Don-alds!… Mc-Don-alds!…”
To put it simply, I’m learning how to save money.One of the best ways to do this is to utilize all employer benefits. From 401k accounts to public transportation benefits, many U.S. employers offer many different benefits however; most include the option to open a flexible spending account.
A flexible spending account, or FSA, is a financial account commonly set up through employers which allows their employees to reserve a fraction of their wage into a separate account. This account can be used in a number of pre-approved ways. The most common pre-approved method for the spending of an FSA is for medical expenses. Ok, so why create a second account just for my health expenses?
Tax Benefits. You elected a portion of your paycheck to go into your FSA, the money is deducted before state and federal taxes are withheld thus; saving you money. Sounds good, what’s the catch? To keep people honest with their FSA and payroll taxes paid, individuals can only change the account settings once a year (unless a pre-accepted change takes place such as marriage, new child, etc.). Furthermore, money submitted to an FSA may only be used during the intended year. This means that once the year is up, the money is gone. For example, an employee makes $40,000 a year and is required to pay 25% of his wages in taxes. Without an FSA he must pay $10,000/yr. However if he decides to put $4,000 into his FSA for the year, his taxable income is lowered to $36,000, allowing his taxes to be lowered to $9,000. He just saved $1,000 on his taxes and paid for health related costs with pretax money. The end of the year is approaching. You and your family are up to date on physicals, dental appointments, and vaccinations.
You have two options regarding the remaining balance in your FSA account: use it or lose it. Chiropractic treatments like those provided here at the Injury Clinic of Dallas are a good way to use those FSA leftovers. Chiropractic Care and related physiotherapy are great courses of treatment for patients back pain, neck pain, and injuries suffered from auto accidents. Chiropractic treatment benefits those who want to be engage in preventive health care. Come on in for an adjustment and free evaluation and use your FSA account to pay for you treatment. Remember, you use it or lose it.