When you have your health, you have everything. Especially when you’re young, your greatest asset is probably your ability to work and earn a steady income. But our health is something we often take for granted, until it deteriorates. And when your health goes, too often your finances follow.
Most people obtain health insurance at their place of employment. But sometimes company-sponsored health plans don’t provide adequate coverage, and they are often quite expensive. In addition, for those who are self-employed, retired, work part-time or work for a small business, company-sponsored health insurance isn’t an option.
Consider these three supplemental ways to hedge against the rising costs of health care:
As life expectancy goes up, the likelihood of needing long term care increases, too. Medicare doesn’t cover everything, and state-provided Medicaid is usually only for people near the poverty line. LTCI may help cover some costs not covered by Medicare, such as nursing home care. LTCI can be expensive, but in the long run, it might be worth it to retain your hard-earned assets.
These are policies purchased in case of extended injury or illness. The key to determining your needs is to see how much you need to spend each week or month that you would be unable to earn your normal income. Even if you have group coverage, a certain amount of individual coverage may be needed to fill any gaps.
You save for retirement, for higher education, or just to treat yourself. But you probably aren’t saving for health care. HSAs are tax-deductible accounts that let you make withdrawals for any “qualified medical expense,” such as doctor’s visits, prescriptions, dental and vision care, even over-the-counter drugs.
Finally, remember the old rule of thumb: have three to six months’ worth of living expenses set aside in a bank savings account in case of emergencies. This could help to cover everything from a job loss to car repairs to hospital bills.
There are many plans and types of insurance that can help you prepare, and ensure a healthy financial future. Eligibility varies for each; a qualified insurance professional can help you decide which is best for you.
WEB82 - 2/1/2017
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