I recently discovered the greatness of flexible spending plans and I signed up at the next open enrollment period. This year has been my first year with a flexible spending plan and I can't believe I wasted those first 6 years.
Flexible spending plans differ from each employer. My employer offers flexible spending plans for medical expenses and child care expenses. I signed up for both and chose to put a small amount in each account each pay period. I wasn't sure how much I would need, but I quickly figured out that $25 every two weeks just wasn't going to cut it. Unfortunately, I have to wait until my next open enrollment period to increase the amount.
Flexible spending contributions are taken pre-tax, thus it is a benefit to you. I'm not an expert in taxes, so I can't elaborate much more than that statement, but I am told it is a good thing.
My medical expense flexible spending plan has been a life saver. My child has conveniently decided to develop allergies and despite the ear tubes, a few ear infections. These have led us to more doctor visits than we expected. The doctor visits require a co-pay and often medications, thus my bank account has felt the squeeze.
Luckily, I have been able to submit claims to my flexible spending plan and my bank account has quickly been replenished. I have been surprised to find that numerous items qualify for my medical flexible spending plan. Any co-pays for appointments or medications qualify as well as over the counter medications and even contact lens solution.