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Originally published Sunday, November 22, 2009 at 12:10 AM

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Money Tip

Year-end goal: Use up your flexible spending account (FSA)

The Morning Call (Allentown, Pa

The end of the year typically means frantic spending on the holidays, but it also could mean frantically using up your flexible spending account. However, there are some creative ways to do so.

An FSA is a benefit typically offered by large employers to help employees defray medical costs not covered by insurance.

You designate a yearly amount to contribute to the FSA. Your employer deducts that amount from your check prorated before taxes. Whenever you pay for an approved medical item, you draw down on those pretax contributions, often with a dedicated debit card.

The account allows you to save money by purchasing health-care-related items with pretax money, essentially giving you a big discount.

The problem with FSAs is they are use it or lose it.

You must use the FSA money by the end of the calendar year, though many employers extend the deadline into the following year. Otherwise, you forfeit the balance. This was a big drawback until recent years, when the IRS loosened rules on what you could buy with FSA money.

Though FSA money is typically used for medical co-pays, deductibles and prescriptions, here are a few other FSA purchases:

Hand sanitizer: With the regular flu and H1N1 running rampant, keeping hands clean is prudent, so sanitizer qualifies.

Cold and flu medication: Over-the-counter cold remedies such as cough drops and syrups, throat lozenges and cold medicines are often reimbursable.

First aid: Such supplies as antiseptics, bandages, first-aid kits and joint supports are eligible.

Family planning: Birth-control pills and devices qualify, as do pregnancy tests and vasectomies.

Contact lens supplies: You can use FSA money for eyeglasses and contact lenses and for contact-lens solution or eyeglass cleaning cloths. Prescription sunglasses, even clip-ons, and corrective swim goggles are included, as are reading glasses, eyeglass repair kits and laser eye surgery.

Double-check with your plan administrator and visit and search for IRS Publication 502 Medical and Dental Expenses.

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