Which option provides a tax-advantaged way to save for eligible health care or dependent care expenses?

• A. Flexible Spending Accounts
• B. Life Insurance
• C. Vision Insurance
• D. Short-Term Disability Insurance

Answer: (A)

Flexible Spending Accounts provide a pre-tax way to save for eligible health care and dependent care expenses. By contributing from your paycheck before taxes, the amount reduces your taxable income, which lowers your overall tax bill. You can then reimburse yourself for qualified medical, dental, vision costs, or eligible dependent care expenses as they come up. Some plans have rules like use-it-or-lose-it (though there may be limited carryover options), but the essential idea is a tax-advantaged pool you use to pay for these specific costs. The other options—life insurance, vision insurance, and short-term disability—offer protection or income support, not the same pre-tax savings mechanism for paying eligible expenses.