Offer your thoughts or opinion on the input financial query or topic using your financial background.

FSA when a retirement agreement has been put into place
While you have found a way to possibly gain $1275 in tax free income, you are also risking $1275 if you end up not using the money you contributed. You will have to find a way to have that much in medical expenses by your retirement date or you will leave some money in the Flexible Spending Account. There are risks you take with these accounts (use it or lose it) and risks the company takes (leave with a deficit in the account). Many times we get questions about how to spend all that the employee contributed before the last day of work, or the end of the plan year.  You can play it more fair by selecting the maximum amount per check to be taken from your pay check, then waiting until the retirement date to decide how much you will withdraw from the FSA. Your last day of work is your last day to incur a medical expense but you are given a window to submit your claims that extends beyond your last day of work.  I have not personally heard of an employer requiring a former employee to pay back the money when there is a  deficit in their FSA.  Remember people are fired, or laid off with little or no warning trapping their money in a FSA. The fact that you have the ability to plan for this event and considered your options, is a great position to be in.