Summary of Flexible Spending Accounts

Flexible spending accounts are a potentially valuable employee benefit that allows you to save money on your health and dependent care expenses. Most employees are thrilled to learn that they can cut these costs by up to 40 percent. A wide variety of expenses qualify for health FSA reimbursement, including over-the-counter medications (with a doctor’s note or prescription), prescription glasses, and other expenses—expenses that traditional healthcare coverage often does not cover. If you have dependent children or dependent disabled or elderly relatives, you can use a dependent care FSA to pay for qualified expenses such as adult daycare, preschool tuition, and day camp costs. To top it off, accessing benefits is easy with most FSAs—you can use debit or credit cards with many plans, while others will reimburse you through checks or direct deposit after receiving proof that you paid the qualified expenses. Still, only a small percentage of employees take advantage of FSAs, a fact that necessitates greater educational efforts to promote them.