Gen Z Guide to FI

Castlight is an app that many companies in the US give as a perk to track different health metrics. Every year, I am eligible for $300 worth of rewards. Usually, I take the Visa gift card options or Target gift card options. Getting a gift card means I’m having 42% of the gift card value deducted as taxes from my paycheck.

Let’s examine the taxes I paid last year for a Target $300 gift card redeemed from Castlight points. I paid 42% of that in taxes, totaling $126. Ultimately, my ‘$300’ gift card was worth $174. It was still free money, so I was okay with it, but I was mad that my paycheck was less.

But this year, I contributed the $300 from Castlight rewards points to HSA. Instead of having taxes taken out, I actually increased my regular paycheck by $69. I was already maxing out my HSA, so adding this $300 reduced the biweekly contributions I had planned for the year. Since my paycheck contribution amount was reduced, my net pay increased. This means my ‘$300’ Castlight points were worth $369. I liked that I avoided paying 42% taxes from redeeming points.

Does the math make sense to you all? Or am I getting excited for nothing?

My mind was blown when I tried this. It was value-added because I was already maxing out my HSA. Now, if you are not maxing out your HSA, you might not get this additional bump in income.

Let me know what you all think! Do you use Castlight?

XOXO Gen Z Fire Baby