Good news has been hard to come by lately, but thankfully something very exciting came out of the $2 trillion relief bill that Trump signed into law last week. It does more than put $1,200 into your pocket. (Read more about who qualifies for which amount here.) A provision under the bill allows you to use the funds in your Health Savings Account (HSA) and Flexible Savings Account (FSA) to pay for period products. Score!
This is the first time in history that individuals have been allowed to use the pre-tax dollars that get set aside into these accounts to purchase period products. Previously, those items were not considered “medical expenses,” but the CARES Act changed that. The specific products that are now considered medical expenses include tampons, pads, liners, cups, and sponges.
“I think a lot of people have expenses that they weren’t planning on, certainly with the virus, while sheltering in place or in self quarantine,” says Roy Ramthun, Founder and President of HSA Consulting Services. The provision to allow HSA dollars to be used on feminine products is a very big deal for women, he notes, stating that by using pre-tax HSA funds, and being able to pay paying without sales tax, you can save as much as 30-40% off the sticker price for these products.
Ramthun adds that if you’re not doing so already, this is a great time to be adding more money to your HSAs and FSAs. With these new rules, he recommends adding up the “money you’re already spending, and include these things as well, and see if you’re putting enough money into your HSA to cover it all. If not, then add more money to help out.”
Overall, the CARES Act is aiming to combat the growing unemployment rates and stock market volatility we’ve seen over the last few weeks due to Coronavirus. Everything it includes aims to help Americans financially during this global pandemic. Of course it’s not the first time the conversation around period products as medical expenses has been had — In 2018, a bill that would have made this law wasn’t passed by the senate, and these products were left out of the realm of HSA-eligible items. Thankfully the conversation was opened up once again, as the government had renewed incentive to help American citizens pay for necessities in the most affordable way possible.
While the CARES Act isn’t permanent — its provisions are meant to help see us through this crisis — it certainly opens the door to have the conversation about “period products as medical expenses” in the future. For now, enjoy swiping that HSA debit card on your purchase of tampons and pads, and make sure to hang onto those receipts.
To learn more about the CARES Act, how it can benefit you, and what you can do if you don’t need your $1,200 check right now, read through our rundown here.
MORE FROM THE HERMONEY TEAM ON LIVING THROUGH THE COVID-19 CRISIS:
- Jean lays out the questions you need to ask before you make any changes to your portfolio.
- Kathryn ponders whether or not one can secure a 0% mortgage thanks to the Fed rate cut.
- Dori dishes on what a recession really is, and how it will impact your finances.
- Christine tells us how to rock any work-from-home situation.
- Kathryn and Becca tackle 10 FAQ about coronavirus, stock market volatility, and your portfolio. .
- Dayana looks at how long stock market crashes, dips, recessions and corrections have historically lasted and what to expect going forward.
- Beth explains how your investment goals influence how you handle sudden stock market moves.
JOIN US in the judgement-free zone with our free weekly newsletter. Sign up today!