r/predaddit • u/mrbiz89 • 1d ago
Advice needed FSA Contribution
Hello, my wife and I are expecting our first-born in February. We are both on her health insurance. What should we know about contributions to her FSA? Likely safe to max it out if that is around $3,400?
Thanks in advance.
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u/scribe_ 1d ago
Fellow February dad to-be!
We maxed out our FSA (on my coverage) last year, and are doing the same this open-enrollment period. So far, we’ve got about $620 left from last year. It’ll probably run dry by the end of the year, and it’s been really helpful.
Figured it couldn’t hurt to do it again this year, in addition to a dependent care FSA (if available).
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u/jrobertson50 1d ago
HSA I max since it carries over each year. Fsa doesn't so only contribute what you will use
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u/Chandlingus 1d ago
Feel like FSA is just a waste of time personally.
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u/sirius4778 1d ago
Yeah we max dependent care fsa for daycare and hsa. We don't really have a lot of consistent fsa eligible expenses and the whole use it or lose it thing is dumb as hell. I don't want to be spending $800 on sunscreen and fire extinguishers or whatever because it's November and my kid didn't break an arm lol
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u/funkyb 1d ago
My insurance was good enough that we wouldn't have maxed out on medical stuff. But you can use it for daycare so we max it out yearly and easily spend through it on that in a few months.
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u/Majestic-Macaron6019 1d ago
Childcare FSA funds are separate from medical FSA funds (unless you have a really weird setup)
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u/424f42_424f42 1d ago
A DCFSA (dependant care, fsa) isn't a weird set up.
And technically you can't use your FSA for them.
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u/Majestic-Macaron6019 1d ago
Yeah, but they're usually a separate account from the medical FSA (at least, mine is)
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u/Majestic-Macaron6019 1d ago
You can almost certainly assume that your wife will hit her out-of-pocket maximum, unless your insurance has a designated lower maximum for obstetric care. If that's close to or more than $3400, max her FSA. If you have access to an FSA through work, you should consider maxing it, as well. Each of you can set aside $3400, which can be spent on anyone in the household. This goes doubly if either of you wear glasses or contacts, have recurring prescriptions, or need dental work (these are all easy ways to spend extra FSA funds).
My insurance is not the same as yours, but we spent about $2400 out-of-pocket for a relatively uncomplicated C-section delivery with a 4 night hospital stay (I believe the total charge was somewhere around $30,000). I believe it would have been more, but she hit her out-of-pocket maximum during the stay.
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u/scribe_ 1d ago edited 1d ago
“Relatively uncomplicated […] 4-night stay” feels wild to read. We just had our hospital/maternity ward tour and they said their goal was discharge 24 hours after “normal” birth or 48 hours after C-section. A 4-night stay feels like a very expensive medical resort stay.
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u/Majestic-Macaron6019 1d ago edited 1d ago
Ha, fair. 2 of those nights were during the induction attempt, so that's why it was so long. Started induction the Wednesday night, finally had the C-section early Thursday morning, discharged Sunday morning. They were talking about a discharge Saturday evening, but wifey wasn't feeling ready yet.
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u/AltruisticBand7980 1d ago
Really depends on your insurance. I have Tricare reserve and my out of pocket was 80 dollars for a 1 week stay and another 80 for a 1 night NICU stay.
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u/bageloid 1d ago
Just make sure not to be an idiot like me and accidentally enroll in a LP-FSA(only good for vision and dental)
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u/scorpiorose22 1d ago
If you’re planning to do daycare, I know some workplaces offer FSAs for dependent care. Mine does and I just signed up for that next year as well. Tax free dollars going towards daycare! I didn’t know this and just signed up for the health FSA the previous cycle.
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u/CuteAmoeba9876 1d ago
Max out. If you don’t use it on the hospital stay, you can use it on a bunch of other useful stuff.
Baby monitors (some fancy models can run $400), postpartum supplies for mom, prenatal vitamins (gotta keep taking these while breastfeeding), breastfeeding supplies, postpartum pelvic floor physical therapy, and so on.
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u/The_RoyalPee 1d ago
Max it out! You can use your FSA for tons of other things. And it lowers your taxable income.
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u/Upstairs_Taro4726 1d ago
First thing you will have to do is try to get a ballpark estimate of what your expenses will be.
Second, you should do research on what all you can spend the money on. You can get very creative sometimes. You sometimes can pay for transportation costs, parking fees, prescription glasses, dental care, ect. You might be surprised all the ways you can spend it.
I assume you already know, but that money usually expires at around the end of the year for FSA. Sometimes there's a grace period running into approximately March, depending on your plan. Make sure you read the fine print.
If you qualify and have a high deductible health plan, HSA contributions are also a possibility. HSA contributions never expire so if you can I would prefer HSA. If you know your expenses will be high in a particular year, you can do both for the larger tax write-off.
Also a little bonus tip: if you have a very high expense year for medical, dental, or vision costs, anything over 7.5% of your adjusted gross income can be written off on your taxes if you itemize.
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u/TroegsOfficial 13h ago
Probably yes, safe to assume you'll spend $3,400. FSA is better than nothing, but HSA is generally more favorable if you can do it- only qualification is you need to be in a HDHP.
Also - have your wife see if she can elect "Hospital Indemnity Insurance." This is not health insurance but it pays out if she has any kind of hospital stay (my wife's had to be a minimum length of 2 nights to pay out I think). The hospitalization can be for birth or surgery for anything. It has nothing to do with Health Insurance/FSA/HSA. The purpose of it is it's meant to help ease the burden of the non-healthcare expenses of a hospital stay (For example, lost wages for missing work, spouse hotel room, dinners, etc). They ended up paying out more than what our hospital stay for birth even cost us (Again, it's not connected to health insurance, so the payout is not connected to what the hospital charges you, it's pre-determined how much it pays out sort of like a life insurance policy). Super cool to have if it's offered, and the premiums are really cheap. And if your wife is pregnant it's almost certain she will have a hospital stay to qualify for payout haha.
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u/TroegsOfficial 12h ago
It even paid out a certain amount for our baby since he, too, had a hospital stay immediately upon being born.
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u/aces1818 1d ago
We maxed out. Between hospital stay, copays, doc appts pre- and post-partum, you’ll get there. We also wear glasses and contacts so we have other “sources” for the FSA.