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Comment by tantalor | Hacker News Reader

I can see it now: it's December and my FSA still has a balance, must be time to buy 12 Apple Watches and sell them on eBay.

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Out of curiosity, does your health plan have an HSA? After learning about these I decided that FSAs are a total rip off. Why would my money expire?

If you know you're going to have certain recurring expenses, they can be great. That money's untaxed so you're basically getting a 25% or whatever discount on whatever you buy with FSA money. But yes, the expiration bit is insane. That's how I ended up buying a pair of prescription Ray-Bans in late December several years ago.

> That money's untaxed so you're basically getting a 25% or whatever discount on whatever you buy with FSA money

This is the same with an HSA. The difference is that you can invest funds from an HSA and the growth is tax free.

That's not the difference. The difference is that you have to have an HDHP to use an HSA. My employer pays for me to have a very good low-deductible policy. I did the math and it would almost certainly cost me more out of pocket to have an HDHP than what I have now. If you are young, single, and healthy, the equation may look different. If you're older and have a spouse and kids, it's shockingly easy to hit the deductible and OOP max year after year.

I could imagine a case where I'd start an FSA. An HSA did not work out well for me a few years ago when I tried it, and would be even less likely to be a win for me now.

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