No one plans to get cancer. No one plans to be out of work sick for 6 months or more.
As a self-employed physician, I thought that if I had 3 months worth of money in the bank to cover my expenses, along with disability insurance to replace lost income, I would be okay. What I failed to realize is, that my cancer treatment would take nine to ten months to complete and my disability insurance only replaced about 30% of my income. In addition, I didn’t count on the extra expenses that come with cancer treatment nor my husband losing his income while I was out sick.
I had to go back to work part-time during my treatment. There were days, I went to work feeling sick, nauseated, and extremely tired. It wasn’t the ideal situation, but it was necessary to keep my bills paid.
I realize now, that I wasn’t financially prepared for my extended illness. This was a hard lesson to learn, but I don’t want anyone else to experience this situation .
Here are four ways to help financially prepare you for an extended illness such as cancer treatment.
- Have at least 6 months of savings in the bank to cover monthly and unexpected expenses.
Why?
- In addition to your normal bills you now have added medical expenses. that include medical insurance deductibles, co-insurance payments, medication costs and office co-payments and payments for procedures not covered by your insurance.
- Know your insurance policy and your out-of-pocket maximum. Some financial experts tell you to lower your insurance costs by picking a low cost plan with a high deductible. If you do that, just make sure have enough money in your savings account to cover that high deductible if you get sick and have to use the insurance.
- Life happens, so prepare for the unexpected.
- Unexpected costs such as home and auto repairs , traffic tickets, yearly expenses not included in your regular monthly expenses, another family member getting ill or losing a job, can take a large chunk out of your savings. So putting a little extra money aside will help .
- Live below your means
- This will help you accumulate the six months of savings that you need.
- This will keep your expenses to a minimum if you ever lose your full income.
3. Get Disability Insurance
- Be sure to review and compare policy’s yearly.
- Increase your coverage as your income grows.
4. Get a cancer or critical illness policy.
- Read the fine print to make sure you are not duplicating coverage.
- Very important if you have a history of cancer in your family,
- The payouts can help bridge the gap between your disability insurance payments, health insurance payments and your working income.
This might sound like overkill to many of you, but if you are self-employed and you get sick, you will be happy you did this.
What other suggestions do you have?
: Live today, like you are retiring tomorrow
