Though this topic might not feel exciting to some, this is the sort of stuff you need to understand.  Medical and dependent care expenses add up, and these are all vehicles and tools to help improve your financial situation.  So if they are available to you, then learn about them and use them!FSAs - Flexible Spending AccountsWhat is an FSA?A special account you put money into that you use to pay for qualified out-of-pocket health care costs. E.g. co-pays, medicine, prescriptions, etc.  Why is an FSA important?It’s tax free.  This means you'll save an amount equal to the taxes you would have paid on the money you set aside.What else should you know about FSAs?You choose the amount you want to put into an FSA during annual benefits enrollment and then it comes out of your paycheck on a pro-rated basis throughout the year.  You cannot change the amount unless there’s a qualified event that allows you to change your overall benefits (e.g. a divorce, birth of new child, a global pandemic, etc.).  The money you set aside has to be spent within the calendar year, or very close to it.  Read the fine print of your specific FSA.  There is usually a couple month grace period for filings into the next calendar year, but it’s for expenses during the calendar year you saved it in.  If you don’t use/get funds reimbursed buy the deadline noted, the money gets forfeited back to your company.There are maximum limits to how much you can put into an FSA, set by the federal government.  For 2020, it’s $2,650 per year per employer.  You and your spouse could both max it out if you’re expecting a big year of medical expensesHow do I decide how much money to put into an FSA?Do your best job to estimate what your family's medical expenses will be in a future year, based on what they’ve been in the past and what you anticipate happening.  You can never plan perfectly for this.  If your family has really low medical expenses, consider a high-deductible plan and then put into an HSA which doesn’t require you to think about the amount.  Plan ahead, so if you know your child will need braces in 2021 then put a big amount into your FSA.  If a big medical expense pops up mid-year, and it can wait until the following year then hold off on it and put money into an FSA to pay for it.  Plenty of medical expenses can wait.  But also, plenty can’t!  Call your doctors and ask what something will cost so you know.  Forecast things out!When you leave your company, what happens to the FSA?Your FSA is tied to your job.  Any money left unused in your FSA when you leave a job goes back to your employer.  This means you need to use it or lose it during any notice period you have of leaving a job, whether it’s your choice or not to leave.  HSAs - Health Saving AccountsWhat is an HSA?A Health Savings Account is a type of savings account that lets you set aside pre-tax dollars for qualified medical expenses.  Why is an HSA important?It’s a great tax-free savings vehicle that allows you to further diversity your portfolio. What else should I know about HSAs?It’s only available if you’re on a high-deductible medical plan.  We’ll do an episode soon on how to compare and think about different medical plan options for 2020, but HSAs are a meaningful reason to go high-deductible.  You choose the amount you want to put into an HSA during annual benefits enrollment and then it comes out of your paycheck on a pro-rated basis throughout the year.  You cannot change the amount unless there’s a qualified event that allows you to change your overall benefits.  There are maximum limits to how much you can put into an HSA, set by the federal government.  For 2020, it’s $3,550 for a single-person HSA or $7100 for a family HSA.  You do NOT have to spend the money you put into an HSA in that calendar year.  You can if you need it, but you can also use it as a “savings account.”  MJT Comment - I now have 10K in an HSA and I can use it in 4 years if I have some massive ER bill for me or one of