An FSA is a risk to the extent that you allow it to be. As others have stated, putting more in than for sure things (recurring costs that cannot really go away and being medical, will not be going down, and strongly intended planned procedures/treatments), may very well not work out.
I find it telling that in 19 years of periodically searching, I find no figures, especially from the federal government, that tell us how much and what percentage of FSA money is lost. "Telling" = powerfully suggesting it is quite a bit.
Bear in mind that people get fired, plague's run rampant ending jobs or curtailing them, doctors turn out to be moving to a different practice and you have to start over on a treatment. (Many times another doctor's work is not accepted by a new one. One cynically notes the extra fees for the repeated work, but more likely, malpractice considerations are the reason. Given either, or both, one imagines it varies across the industry as well.) Things happen.
An HSA is rather different. There just really isn't a downside except in the sense of money saved instead of improving today's life. And that is pretty personal and situational, so not too germane to a forum like this so it doesn't matter to an extent.
The tax savings are exceedingly nice and have been described already. And now that the Chinese plague has affected things, even OTC items are allowed to be paid for without a prescription. What could go wrong? And there is an asterisk to part of the tax savings. More on both in a moment.
Probably the most fantastic reason for an HSA is the required high deductible health plan. Those are treated as horrid by most who have no experience with them, quite wrongly for many considerations, but my point here has nothing to do with that perception/reality. My point is that they are health INSURANCE and what we call health insurance is utterly not. HDHP's, if they spread, will cut into the cost of medical care in a large way. Slowly at first, given the entrenched machine we have at the moment and the fact that Medicare is a huge part of that and will NEVER act like insurance, but if they were even half the market, health care costs in the US would stop rising and in practice fall due to inflation, however slowly. It took 2-3 generations to really ruin health care, and might take at least that many to fix it. What's the secret? Instead of consumers being, in practice, cut off from pricing and payment, there is no natural pressure to contain prices or to not consume an infinite amount of services. HDHP's cut deeply into both economic (not medical) problems.
So, back to what can go wrong. Well, unexpected costs usually accost families on a somewhat regular basis. The money's sitting there... but can't be used without penalty. One can try taking it and pleading an extreme situation, but I've not been able to find any figures on how much of such the IRS allows and disallows. Where does one get the money for the penalty? More non-medical withdrawal... more penalty... at least it is a closed feedback loop, but...
A minor downside is that some plan operators nitpick about every expense. In theory, they can require you show proof the expense qualifies before paying it, or you. One DOES search and find stories about that. Others, like mine, do not police it to any extent at all, as nearly as I can tell from the folks at work and my experience. I will mention that I do not mind at all whatever "arm" the government is applying to providers like drug stores making them police purchases as that goes a very long way toward reassuring me a purchase will not cause me trouble if the IRS ever audits me.
One of the greatest advantages of an HSA is the IRS is fine with you changing contribution amounts at any time. Weekly paychecks? Weekly changes if you like. You can tailor your contributions to fit life's circumstances. And it offers a rather interesting "cheat." However, one should note that there IS an annual limit and ALL money paid into the HSA counts toward it, not just that with the best tax advantage.
The limit could be an issue if working spouses contribute (almost certainly to separate plans) in the same way general tax withholding can be an issue in the same scenario. Both's contributions count into a common limit and overcontribution needs fixed and fixed soon. Not everyone is on top of things enough to deal with that kind of concern, so any problem cropping up can quickly become a big problem (even though it should be a minor issue, and even more, should never happen).
Money you never touch, that is withdrawn from your pay gets not just federal tax protection, but Social Security protection as well. Money taken from savings only gets the federal tax protection. So if you can hold off until the full amount you can contribute, or need to contribute, runs through your paycheck, you get a massive benefit. Examples given above, though not explicit about it, imply you put money into savings and have flexibility about what you use it for, only contributing it if needed. Strong implication. But that loses the Social Security tax protection.
A better way, assuming you have the money in savings of some liquid kind, and can work with a week or so's delay (or less, that'd just be the max, usually), is to see the bill and immediately change your payroll contribution. You're young and have a child born. Say that's $4,000 out-of-pocket, HDHP handling things above that. Well, you don't just pay immediately even if you have the savings. When you are ready to pay, immediately-ish or slowly over time, you bump up your contribution to whatever you are paying. Lots of variables here, so let's say you take home $478.22 a week. That includes a $10 contribution already. You tell the boss to withhold $1,000, or as much as he can. It could be done to the penny, but say that turns out to be $610 and you still take home $2.23. Once it posts in the bank handling your HSA, you pay that. That's the couple days to a week thing. One night for mine. In a slightly different variation, you pay the $610 from savings, then reimburse yourself once the money is available at the HSA bank. Rather than contribute directly from savings. Rinse and repeat.
That ability to "pivot" is a huge advantage from the HSA program. A fellow here's parents gifted him $2,000 and he did that to run the cash into the HSA. Maxed his contribution so his take home was minimal and "took" the amount contributed from the $2,000 in his checking account (from his parents). He DID have to have a bit of discipline to not overspend from a feeling of Bezos-like wealth, but as an adult, he managed that. So he got the full tax benefit as a contribution. As a gift, doing otherwise wouldn't have had any tax benefit at all. And all in keeping with the federal government's goals, his parents' goals, and his own.
A nice "cheat" available solely in the HSA program.
From helping to begin fixing America's medical cost explosion to being very flexible in practice and a huge tax saver, an HSA has no equal. There ARE practical difficulties that life tosses in, but it does the same with the FSA program, so comparing the two is a net zero there.
My strongly considered opinion is both ARE winners, not bad deals. There IS a difference in that the FSA program is a LOT less tolerant of life's vagaries, but it is still a good deal if available and used carefully. The HSA program requires less of such care and still delivers a terrific deal. Naturally, one must mind the rules and think, but then life itself is like that. Anyone with a chance to have an HSA (and the HDHP that it comes from) should jump at the chance.