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With the end of year right around the corner, many employees arethinking about the upcoming holidays and what they need to get donebefore the new year starts. Whether they’re focused on bookingholiday travel to visit family, finding the best deals on gifts, orthinking about their New Year’s resolutions, employees likelyaren’t thinking about one thing — their benefits.

One aspect of benefits often overlooked by employeesis flexible spending accounts (FSAs). While this isa valuable benefit for workers, the money in an FSA must be used bya specific day or the remaining money is lost. For many employees,this tax-free income is wasted when FSA holders don't spend alltheir funds or fail to submit expenses to bereimbursed.

As a broker, you can help to ensure your clients’ employeesdon’t have to feel the sting of lost funds. The following are a fewdetails to highlight for employers so they can remind employeesbefore the clock strikes midnight.

Use it or lose it

The “use it or lose it” rule generally states that any moneyleft in an employee’s FSA that is not spent by the end of thecalendar year is forfeited. However, employers can amend their planto offer an extension or allow for a carryover of unused funds.Either way, employers should send employees reminders in the lastseveral weeks of the year so they have enough time to use the moneythey have set aside.

Encourage employees to stock up for nextyear

FSA funds can be used on hundreds of different qualifyingproducts. As the year comes to a close, provide an FSA checklist toemployers so they can educate employees on the expenses thatqualify. For example, workers can use their funds to buy an extrapair of prescription eyeglasses, pay for an appointment with aphysical therapist or purchase items the whole family can use, suchas first-aid kits, hot and cold packs, and thermometers.

Prepare employees looking to elect an FSA

Now is the time to not only remind employees to usetheir FSA funds, but also to educate those who haveelected an FSA plan for the upcoming year. During the openenrollment period, provide FSA calculators so employees cancorrectly determine yearly out-of-pocket health care expenses.Arming employees with the right tools may help them gain a betteridea of how much they should contribute to an FSA so they don’twaste money.

Help ensure employees start the new year offright

FSAs can be difficult to understand, but they are a usefulbenefits option for many employees. For brokers, now is the time tosend year-end reminders to your clients about FSA policies so theycan educate their workforce on how these funds can be used. Thiswill help ensure all employees head into 2017 without benefitsregrets.

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