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Enrollment Season: How Much Should I Put In My FSA? (Or HSA?)

How much should I put in my FSA?

Enrollment season is here and your company will likely be talking about benefits in the near future. If you participate in your employer’s plan, you’re probably wondering, “How much should I put in my FSA?” or “How much should I contribute to my HSA?”

Unless you’re a psychic, budgeting for future medical expenses can be difficult. You never know when you’ll have an emergency room visit or if you’ll need a new prescription next year.

As a general rule, though, if you visit your doctor or dentist on a recurring basis, or if you have ongoing eye care needs, you can come up with an estimate for next year. I’ve provided some information below to help you answer: How much should I put in my FSA? (If you have an HSA and/or dependent care FSA, there is information for those accounts too).

Flexible Spending Account (FSA)

How much should I put in my FSA?

Before you start crunching numbers, start by finding your receipts or bills from this past year for medical, dental and vision expenses. These include doctor visits, ER visits, prescriptions, dental exams and procedures, and vision exams and eyewear expenses. Add these up for yourself and your dependents. This should give you an adequate estimate for next year’s expenses.

One thing to keep in mind: you need to consider your company’s FSA plan setup. At the end of the plan year, your plan has one of following:

  • Use it or lose it – any unused funds are lost and do not rollover to next year
  • Carryover – a maximum of $550 in unused funds can rollover to next year
  • Grace period – you can use the remaining funds in your FSA for up to 2.5 months in the new plan year

Why is this important? In 2020, if you contributed the maximum annual amount of $2,750, but only had $1,500 in expenses, then you would lose $1,250 with a “use it or lose it” policy. If your plan has rollover, it could cost you $750 in lost money.

This information (and more) can be found in the Summary Plan Description. Talk to your HR representative or benefits administrator for more information.

Health Savings Account (HSA)

How much should I contribute to my HSA?

With an HSA, account holders have more freedom than with an FSA. That’s because any unused funds rollover to the next year. Therefore, if you can afford it, contribute the maximum amount since “use it or lose it” does not apply. Letting those funds build up over time can come in handy for future expenses.

However, if your budget doesn’t allow for maximum contributions, plan for next year by adding up last year’s receipts for medical, dental, and vision expenses. Other costs to consider are your deductible amount and upcoming procedures (such as a having a baby or a knee replacement). Try to cover your deductible costs as those are out-of-pocket until your insurance kicks in.

Learn more about 2021 HSA contribution limits.

Dependent Care FSA

If you have a dependent care Flexible Spending Account (also known as DCAP), you need to know how much you spend monthly on child care. For children up to age 13 years (or an adult dependent who needs care), add up:

  • Before and after care school costs
  • Daycare fees (including deposits)
  • Summer day camp tuitions
  • Adult/elderly care costs

You can contribute a maximum of $5,000 if you are married, and $2,500 if you are single. Remember, with a DCAP, it’s “use it or lose it,” so plan accordingly.


Planning for expenses can go a long way towards maximizing your tax-advantaged benefits for next year. Armed with the above information, you should now be able to answer “how much should I put in my FSA?”.