What’s the difference between HSAs and FSAs?

Which health savings account is right for you? Learn the differences between HSAs and FSAs here:

Key takeaways about HSAs and FSAs.

• Both accounts offer tax benefits and have annual contribution limits.  
• You must have a high-deductible health plan (HDHP) to qualify for an HSA.
• Funds from your HSA roll over year after year.
• Some HSAs offer investment options.
• HSA holders cannot spend more than the funds that have been deducted from their paycheck. However, they can file for reimbursement later in the year.
• You can't contribute to an HSA and a traditional FSA in the same year. But HSA holders can contribute to an LPFSA for dental and vision expenses, and to a Dependent Care FSA for child care costs.
• FSAs work on a "use it or lose it" basis, meaning any funds not spent by the end of your plan year will be lost, unless the plan has a grace period or rollover feature.
• You can use your FSA to cover eligible health care expenses early in the year, as long as you plan to contribute what's necessary to cover those expenses by the year's end.
• You contribute funds to an HSA and FSA, but only your employer can contribute to your HRA.
• With HRAs, employers may limit which health expenses are eligible and the amount you’re able to roll over from year to year.