Don’t Miss Out on These 7 Sources of ‘Free Money,’ According to Fidelity
Written by
Laura Beck
Edited by
Molly Sullivan
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Building wealth isn’t always about earning more income. Sometimes the biggest opportunities come from claiming money that’s already available to you but often overlooked. Fidelity recently outlined seven financial benefits that function like “free money” — if you know how to access them.
Maximize Your 401(k) Employer Match First
The most straightforward source of additional money sits in your workplace retirement plan. If your company offers 401(k) matching, you’re essentially leaving part of your compensation unclaimed by not contributing enough to capture the full match.
Fidelity’s research shows many employees miss out on this benefit entirely. The matching formulas vary by employer, but a common structure might match dollar-for-dollar up to 3% of your salary, then 50 cents per dollar for another 2%. In this scenario, you’d need to contribute at least 5% of your salary to get the complete employer match.
While Fidelity recommends saving 15% of pretax income annually for retirement, starting with enough to capture your full employer match should be the minimum baseline.
Health Savings Accounts Offer Triple Tax Benefits
HSAs provide what Fidelity calls a “triple tax advantage” — contributions are pretax, earnings grow tax-free and withdrawals for qualified medical expenses are never taxed. This makes HSAs one of the most tax-efficient savings vehicles available.
The strategy goes beyond just paying current medical bills. Fidelity suggests contributing the maximum allowed amount while paying current healthcare costs from other sources, letting your HSA grow for long-term investment potential. You must be enrolled in an HSA-eligible high-deductible health plan to qualify.
Employee Stock Purchase Plans Can Generate Instant Returns
Many workers ignore their company’s employee stock purchase plan (ESPP), but these programs often include features that function similarly to employer matches. Most ESPPs allow employees to buy company stock at a 15% discount, creating immediate returns even for short-term holdings.
Some plans include “lookback” provisions that let you purchase shares at whichever price was lower — either at the beginning or end of the purchase period. While accumulating too much company stock creates concentration risk, the immediate discount and potential matching features make ESPPs worth investigating.
Flexible Spending Accounts Reduce Current Tax Bills
Unlike HSAs, flexible spending accounts operate on a “use it or lose it” basis within each plan year. However, they still provide valuable pretax savings for predictable medical and dependent care expenses.
FSAs depend on your employer offering them as a benefit, unlike HSAs which depend on your health insurance type. You can contribute to both an HSA and a dependent care FSA in the same year, but not an HSA and healthcare FSA simultaneously.
Tax Credits Provide Dollar-for-Dollar Savings
Tax credits reduce your tax liability directly, making them more valuable than deductions that only reduce taxable income. Common credits include the child tax credit, child and dependent care credit and the American opportunity tax credit for education expenses.
Fidelity notes that many people miss credits simply because they don’t realize they qualify. Income changes, family size adjustments or employment shifts can affect eligibility, making annual reviews important. Recent tax law changes make checking 2025 eligibility particularly worthwhile.
Overlooked Workplace Benefits Add Up
Beyond retirement and health accounts, employers often provide additional benefits that put money back in your pocket. These might include commuter benefits, tuition reimbursement, gym memberships or student loan assistance programs.
Fidelity recommends reviewing your complete benefits package annually during enrollment periods or even more frequently. Employers regularly add new benefits, and your personal situation changes may make previously irrelevant benefits valuable.
Rewards Credit Cards Turn Spending Into Cash Back
Strategic credit card use can convert routine expenses into cash back, travel points or other valuable perks. The key involves choosing cards that match your spending patterns and understanding how to maximize reward categories.
Success requires paying off balances in full monthly and understanding any associated fees. When managed properly, rewards cards essentially provide discounts on purchases you’re making anyway.
Making These Benefits Work Together
These seven sources work best when combined strategically. Start by capturing your full 401(k) match, then maximize tax-advantaged health accounts based on your situation. Research your ESPP terms and review tax credit eligibility annually.
The compound effect of claiming multiple “free money” sources can significantly impact your financial position over time. Rather than chasing complex investment strategies, focusing on these often-overlooked benefits provides guaranteed returns on money that’s already within reach.
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