Well, a flex spending plan usually contains expenses that are medically necessary, which means those costs were going to be incurred anyway. When you go to the dentist or buy medicine, you have to pay the provider at the time service is rendered. You submit a receipt to the company managing your FSA program and get reimbursed with a check. They key to helping pay off your debt faster is the choice of which credit card you’ll use to pay the provider.
Paying Down High Interest Debt Faster
Look at all of your credit cards with open credit lines. They probably have different interest rates. Because of the CARD Act of 2009, it’s no longer possible for credit card companies and banks to ratejack your current credit card balances unless you miss two minimum payments.
So what you need to do is to pay for medical expenses on the card with the lowest interest rate. When you get the money from the FSA, pay down the card with the highest interest rate. In essence, you’re moving debt from a higher interest rate to a lower one while incurring expenses that you were going to incur anyway because they’re medically necessary. If those expenses weren’t medically necessary, they would not be eligible for the FSA in the first place.