It is insurance time soon. We have the option of a flexible spending account.
I wear glasses, and need new ones every year or so.
I take 2 thyroid meds because mine was removed. I have to take them. I take a couple of others as well.
I do not understand the FSA, and am not sure if I need one. I have about $100 USD in meds co-pays a month, and $25 co-pays for at least 8 doctor visits a year for blood work for the thyroid stuff.
My coworkers are better at adulting, and I do not want to ask around at work…
So do I need one, and how does it work? Thanks in advance.
In: 15
You have two kinds of money: a) money your employer gives you; and b) money you have paid federal income tax on.
Alas, the tax rate can be pretty high, so $100 of (a) might only equal $70 of (b). The concept of an FSA is using (a) money to pay for healthcare. Since the medical provided doesn’t care if it’s getting (a) or (b) your salary goes farther if you spend (a) money.
So, you tell your employer to put (a) into an FSA, instead of paying it to you. Then you tell the FSA to give that (a) money to the doctor, paying their bill. If you get to the end of the year, you have to pay a tax/penalty to get that (a) money turned into cash, which is (b) money.
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