What is a Flexible Benefits Plan?

A flexible benefits plan is an employer-sponsored plan that allows you to pay for your health insurance, qualified out-of-pocket medical and qualified day care expenses pre-tax.

Most employers today offer premium conversion where you pay your portion of group insurance premiums and some voluntary insurance premiums pre-tax, saving you money!

Another way to save is by participating in the Flexible Spending Accounts (FSA).

There are two types of spending accounts:

Medical Spending Account - pays for medical expenses not covered by insurance. You can use the money in this account to pay for the diagnosis, cure, treatment or prevention of a disease, and for treatments affecting any part or function of the body. The expenses must be primarily to alleviate or prevent a physical or mental defect or illness and cannot be reimbursed by insurance or any other source.

Dependent Care Spending Account - pays for dependent care for children and/or a disabled dependent so you and your spouse can work or be full-time students

The spending accounts work like a personal expense account. You set aside a portion of your salary before taxes. The money is used to pay certain childcare and medical expenses not covered by insurance, including prescription drugs and many over-the-counter medicines. Since the money is set aside pre-tax, you save on federal, state, Social Security and Medicare taxes, and keep a lot more of your take-home pay.

It's a great benefit from your employer and it's the easiest way for you to save big on expenses that typically occur throughout the year.

You decide how much you want to contribute to each account. We've provided a simple worksheet in the Flex Employee Guide found on our web site to help you budget your election to get the most out of your Flexible Benefits Plan. It's quick and easy to enroll. And could save you thousands of dollars!

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