LOOK INTO FLEXIBLE SPENDING ACCOUNTS
FSAs can be a good way to set aside some tax-deductible contributions and pay for health or dependent costs by pulling out the money tax-free. But, make sure you know the restrictions.
There’s a maximum that you can contribute, and if you don’t use it for the year, you generally lose it, Ellis said. However, “one of the nice benefits is that you can use your entire year’s contribution amount in January — before you contribute anything,” he said.
For instance, if you sign up to set aside $1,000 in your FSA and have LASIK surgery in January, you can pay for your procedure with your promised contribution and have those funds deducted from your paycheck throughout the year.