What is the difference between an HSA and a limited-purpose FSA, and can I have both?

A regular general-purpose FSA disqualifies you from contributing to an HSA because it counts as disqualifying medical coverage. A limited-purpose FSA is the workaround: it only reimburses dental and vision expenses, so it does not block HSA contributions. You can run both at once, using the limited-purpose FSA for glasses and cleanings while your HSA grows for everything else.

The key trade-off is the FSA use-it-or-lose-it rule; unspent FSA funds are generally forfeited at year-end aside from a small carryover or grace period your employer may allow. The HSA never expires. Use the limited-purpose FSA only for spending you are confident you'll incur, and let the HSA carry the long-term savings.