Reply #11: Confusion

[Sgent]

There are actually 2 types of accounts.

FSA -- Flexible Spending Account, also known as a Cafeteria plan, or 125. This has been around for a long time, and IT IS use it or lose it. Only available if your employer makes it so. This is a supplament to your regular health plan, and can be a good tax savings if you have ongoing expenses, as contributions are tax deductible for both income taxes and FICA.

HSA -- Health Savings Account, relatively new, can be taken out in a corporate or individual environment. These are savings accounts (can be invested), coupled with a high deductible health policy 2,000-5,000. The idea is that your major expenses are covered, but minor expenses are up to you. Commonly, the employer will put 1/2-3/4 of the deductible in the account annually, and you can also put money away. This account IS CARRIED over from year to year.