Nothing can throw a wrench into your finances faster than an unexpected health expense. Whether you’ve been injured in a car accident or have developed a health issue that requires a hospital stay, your finances can take a huge hit. Even though many people have health insurance, there are instances in which your plan may not cover every expense. There are steps you can take to plan for these unexpected events and keep them from draining your bank account.
Add a flexible savings account to your plan
One way to combat unexpected medical expenses is to open a Flexible savings account (FSA). FSAs are offered by a number of health insurance companies, including Health Alliance Plan. These accounts involve a monthly deposit, which is deducted from your paycheck and is not taxed. Money in your FSA can be used to cover expenses that aren’t covered by your insurance plan, which can help reduce your out of pocket expenses. Since these accounts are only available for health expenses, you won’t be tempted to use your savings for other expenses.
Buy a supplemental insurance plan
Like an FSA, supplemental insurance is meant to cover costs that aren’t initially covered by your insurance. Supplemental insurance plans include vision plans, dental plans, disability plans, short term insurance, Medicare supplements and others. These plans are paid for with a monthly fee, just like a traditional health plan, and they can be invaluable for covering unexpected expenses. Having a good disability insurance plan can help immensely if you are in a situation in which you can’t work due to an accident or other unforeseen circumstances. Supplemental plans like vision and dental also help cover routine exams, prompting you to catch potential health problems early, when they are easier to treat.
Talk to a financial advisor
When planning for retirement, make sure to set up a meeting with a financial advisor who can review your retirement portfolio and assess whether or not you have enough saved to cover major medical expenses. As we age, the chances of being faced with an expensive medical event increase, and they can completely drain your retirement account. By incorporating these events into your retirement plan, you can increase the chance of being able to cover unexpected medical expenses. Planning for these events while saving for retirement can also make your actual retirement years less stressful.
There is no way to predict when you will be faced with a medical emergency, but saving for these events can help keep them from putting a strain on your finances. Talk to your employer to determine your options for building a savings in the event of a medical emergency.
To learn more about affordable healthcare plans for your small business, visit Health Alliance Plan.
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