NPR-Anyone have flexible spending account?

*Amy*

DH told me he could add one if he wanted to, but I don't know much about them.  Do you have one and what do you use it for?  I haven't done any research yet.

rach&jay

We use them for co-pays, over the counter meds, my contacts & solutions, and DD's eyeglasses. 

Its done pre-tax so it automatically saves you money. 

We did $750 for 2008 and went through it pretty quickly.  But we didn't know that Riley would need glasses ($260), and that Sydney would be in the hospital ($250 copay).  We could have used more in it too.

I submit all of the paperwork around Halloween / Thanksgiving and use the big check as Christmas money.

co18co

It's great if you have any idea how much to put in.  We had to pay out of pocket for some of my semi-necessary/semi-cosmetic dentistry, and saved a few hundred dollars by paying for it with pre-tax dollars.

Ours covers supplies like contacts, co-pays, Rx co-pays, vitamins, band-aids, Tylenol,  eye appts (we opted out of the vision plan at DH's current job), and any other medical expenses.  We have some recurring costs, like a med that I take monthly that has a $30 co-pay, so it makes TOTAL sense for us to sit down at the beginning of the year and figure out how much to pull out so it's covered pre-tax.

yankeebear

There at different kinds.  Basically you get money taken out of your check before taxes and you can use it for qualified expenses.  They have them for medical expenses and dependent care expenses.  We have one and we use it for daycare.  There is a maximum contribution of $5K per year.  And I think if you don't use it all by the end of they year you lose it so you have to plan carefully.  Of course daycare is way more than $5k a year, but you get the idea.

Travis&Jen

Heck yeah get one!!  It is pre-taxed money that you can use on health care related items- ie copays, surgery, sometimes you can use it for OTC "health" items as well such as tylenol, saline etc.  You want to be careful not to take too much out b/c if you don't use it by the end of the year you'll lose it.

SumnerBride

Yep, we have one.  I use it for paying for co-pays at doc appts, and medicines.  The website has a list of things I can buy using it.  I also pay for prescriptions with it.  It's really quite nice, and I use it at least once a week now!

For me, it covers things like contacts, lens solution, glasses, heartburn meds, baby Motrin, diaper rash cream, and other stuff like that.  It doesn't cover vitamins however....

aggielady

I had one when I worked, and it was so worth it.  I used it just like pp.  It comes out pre-tax over the year, so it definitely saves you money.  I used it for lasik one year, awesome!  I miss it, the h does not have it at his work. :

xbrooklyngrl

This will be my first year contributing too and the only advise I have it don't put too much in. Be conservative because I know here, if you don't use it, you lose it.

I also plan to do it with daycare because it'll be more savings then the right off.

rach&jay

As pps have pointed out, if you don't use it at the end of the year you lose it.  But you can stock up on over the counter meds and use it all up.

*Amy*

Oh wow.  I will have to sit down and crunch numbers.  DH has HBP so we spend around $50/month on medication. 

xbrooklyngrl

oh girl, you definitely should enroll!

rach&jay

Just based on that, it will seem as if the meds are costing you $38 because when done pre-tax it saves about 25% for you.  Although you still have to pay the $50.  So right there you can put in $600, just for that.

happ17

Get it, get it, get it. It pays for ALL our medical expenses, from doc copays and ER visits to motrin and diaper rash cream and breathe-right strips. The way ours works is we gook our a $2,000 plan. We were given a credit card kind of thing with the $2K available immediately, and they just took $$ out of DH?s check. We didn?t even feel it. And it was great since we had a lot of medical expenses this year.

Flem052204

Flexible spending accounts allow you to contribute pre-tax dollars to an account to be used for very specific purposes.  The IRS has pretty strict rules about how they may be used and I am pretty sure there are only two kinds.  Between you and your DH, you may contribute up to $5K for child care and another $5K for healthcare expenses.  You need to be careful to only contribute what you think you will use because anything left in the account at the end of the year goes to the government.  It's a "use it or lose it" kind of thing.

For child care, you need to have your childcare provider sign a form and provide their taxpayer id number in order to withdraw funds.  Oh, and both custodial parents must be employed or students at least part time to use funds from this kind of account.  If you are a SAHM and send your child to a daycare program one day a week, the you cannot use money from a childcare FSA (flexible spending account) to pay for it.

Funds in a healthcare account are a little easier to access.  You can use that money for any doctor visits, medication, lab tests, etc.  You simply show your receipt and a copy of your insurance explanation of benefits for any out of pocket expenses.  You can also submit receipts for health related purchases.  For example, OTC pain relievers, contact cleaning solution, eyeglasses, a vaporizer or humidifier, etc.  If you have money in your healthcare account at the end of the year, you can always go stock up on Advil and cold medication at Costco.

co18co

Yeah, it's a definite no-brainer if you have recurring costs.  We're actually sitting down this weekend to figure out if we want to budget for Lasik for me in 2009 or not so we can allocate accordingly.

Ours does not allow for "stocking up" at the end, either.  They are pretty strict about it.

 

The plan for using it for Christmas money is GENIUS, by the way!  I just told DH, which is why we're going to get it all submitted this weekend!   

rach&jay

co18co:

 

Ours does not allow for "stocking up" at the end, either.  They are pretty strict about it.

 

I thought it was the IRS that regulated it.  Wow, I've never heard that you can't stock up.  That stinks!

Ciarrai

We do.  We have a huge deductible and out-of-pocket maximum with our insurance (I hate it) so we always do it.  Make sure to research the spending account completely.  We used to have a flex spending account where we could borrow ahead (like when I had a baby in May and we needed all the money we were going to put in that year) but the money disappeared if we didn't spend it by the end of the year.  We now have a health care spending account (I think that's what they call it).  It's more like a 401K (or at least that's how DH explains it).  It's a pre-tax account like the flex account but you can't spend money ahead of time.  The money does roll over from year to year though.  We also have debit cards linked directly to this account so we just "charge" whatever we owe at the doctor's office, pharmacy, etc.  That part's pretty nice but it was hard when we had a baby in February and the new account type only started in January.  We ended up having to call the hospital and ask to pay our cost in monthly payments.  They were great about it and it worked out fine.  Anyway, my point is there's now two different types of accounts, but both are well worth it for health care costs and/or daycare.