Healthcare has become more expensive than ever before, and just because you have health insurance doesn’t mean your doctor visits or other medical expenses will be fully covered. Medical expenses can add up quickly, especially if you or another family member you are responsible for has a chronic health condition. The good news is that good budgeting techniques can help you mitigate some of these costs and allow you to free up a little extra every month.
Use Payment Plans for Dental Work
Dental work can be expensive, and many people end up putting off needed treatments because they can’t afford them. However, a payment plan can help you save money by splitting up a large expense into smaller, more manageable chunks. With Cherry Payment Plans, this allows you to get needed treatment now instead of putting it off until you’re able to afford it. You can quickly apply for a plan to find out what you may qualify for.
Estimate the Total Cost
It can be hard to know how much you’ll end up spending on medical expenses, since no one plans on getting sick. But if you can come up with a rough estimate of how much your expenses will be, you can set aside a little each month to cover them. Look over previous medical bills and financial statements to see how much you have spent on these services in the past. This is especially helpful if you or a family member has a chronic condition, as you may have similar expenses in the future. Add up these expenses and divide that number by 12 to find out how much you should be setting aside each month. If possible, it is better to err on the side of setting aside too much money, so you have some extra padding.
Set Up an FSA or HSA
Setting up a Health Savings Account or a Flexible Spending Account can help you and your family cover health-related expenses. With one of these accounts, you can set aside pretax dollars from your paycheck that can then be used to cover other expenses that your insurance may not cover. Many people use FSAs or HSAs for medications, diagnostic services, mental health care, and copayments. If you don’t have a vision or dental plan, you may be able to cover eye care and some dental care with the money too.
Pay Attention to Medical Debt
Medical bills can add up quickly, even with the best of planning. Every time you get a bill, review it carefully for errors. If you don’t understand something, ask for a detailed, itemized statement. Dispute any errors you notice. This can be a time-consuming process, but it can save you thousands of dollars. Try negotiating your bill with the provider. You may be able to get a discount or a more favorable payment plan if you ask. If you are able to get a payment plan with low or no interest, managing payments will be easier. Typically, medical debt does not accrue as quickly as other types of debt, so consider paying off your higher-interest debts first, like credit card bills.
Leave Room in Your Budget
Take some time to sit down with your budget to adjust it to leave some extra room for unexpected medical expenses. Make sure there is still money in your account each month in case you have an irregular expense pop up. You can do this by ensuring that your expenses, including contributions to savings accounts, are less than your income. This emergency fund should stay in your checking account so if you need the funds immediately, you will be able to access them as soon as possible. This is another way to ensure you don’t have to delay treatment if you have a critical medical issue. The exact amount you should have will be determined by your overall health and how many dependents you have, but it’s a good idea to have several hundred dollars at minimum.
Regularly Reevaluate Your Budget
As your needs change and overall costs increase, your budget should also change. Consider evaluating your budget throughout the year to see if you have been able to stay financially stable, even with irregular expenses. If you have overbudgeted, you can use the extra to pad your savings account. If you haven’t budgeted enough, look for other areas you can reduce spending.
Keep Regular Records
Good record-keeping will help you stay on top of bills, which is important in maintaining your credit. If you don’t have a financial routine, now is a good time to create one. This will help you remember to regularly check on your accounts, budget, and bills. There are online tools that will help you manage your bills all in one place. And budgeting tools can help you balance your budget each month.
