I plan to retire next year - July 31 will be my last day. Open enrollment started today. Normally, I sign up for the medical FSA. Does it make sense to sign up for it for next year? How does it work when you leave in the middle of the year...?
Open Enrollment - FSA
- Thread starter RobotMom
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njhowie
Thinks s/he gets paid by the post
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https://help.zenefits.com/Flexible_...pens_to_My_FSA_Funds_When_I_Leave_My_Company/
I would say don't do it, because generally you state how much you want to contribute over the entire year and then they take out a pro-rated amount from each paycheck. So, you'll be having deductions through your final paycheck unless you pro-actively stop contributions at some point prior. If you don't stop the contributions early, or bulk up with reimburseable expenses early in the year, the likelihood is that you'll end up with some balance that gets forfeited.
Also, remember to use any balance carried over from 2020 into 2021 early in the year.
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There is an advantage to having an FSA for part of the year if you know you might use the full amount before you leave. Our first and only year with an FSA my husband had some expensive dental work that used the whole amount by February. When he was laid off in early November the company could not collect the remaining FSA contributions because he was no longer employed. Evidently, at least in a layoff situation, companies cannot come after you for the remaining contributions.
