Paying for medical care can strain families financially. But if your loved one needs ongoing rehabilitative care, specialized treatments, and medication, the costs can add up quickly. Unexpected health problems can add stress, too, if you’re not prepared.
Thankfully, it’s possible to make healthcare costs more manageable with some budgeting considerations. Read on to learn how families can prepare for the hidden costs of long-term medical care.
Consider costs outside of medical expenses
Yes, you may need to pay for hospital stays and treatments. But you’ll want to consider the other costs that go into long-term medical care as you build your budget.
You may need to travel to specialists in other cities, which requires more gas and subjects your vehicle to wear and tear. You may need to help your loved one secure meals or a hotel reservation for care that’s far from home. And medical equipment may be part of the treatment plan, leading to extra costs.
Make sure your budget accounts for the possibility of transportation needs and living accommodations. Always add some cushion to the budget, as well, for financial surprises. When you can break down costs by month, you’ll be able to understand what extra expenses will look like.
Weigh the impact on income
Don’t be blindsided by a medical situation. Know that your income may need to decrease while you take time off or funnel money toward medical costs. And depending on the situation, you may have a spouse or older child who has to sacrifice income to help you with transportation needs or medical decisions.
Make sure you’re actively looking at your budget to locate opportunities for savings. Whether you limit your grocery shopping trips or reduce your entertainment budget, you’ll help build your savings for serious medical situations. Ideally, you’ll want an emergency fund that covers at least six months’ worth of income.
Look into paid leave benefits through your employer, as well. You may be eligible to take time away from work as you navigate a medical situation. When in doubt, spend with caution so you have enough money saved for medical care.
Know what goes into caregiving
Chronic conditions, declining health, and post-surgery recovery may require outside help. After all, everyday tasks can become significantly harder for a family member dealing with a health situation. They might not be able to make dinner or clean their home without a caregiver’s assistance.
While you can save money by pitching in to help with care at your family member’s home, that’s not always possible. You may feel tired and run down when you’re committing so much time to these efforts. Sometimes, hiring a professional helper makes more sense.
Be clear on the costs for a part-time or full-time caregiver. You’ll need to budget for paid care or plan on taking time away from work to help. Talk with family members to see which options fit your lifestyle needs.
Look at life insurance policies
You may be able to tap into a life insurance policy to help provide financial support, even when someone with a policy is alive. Maybe you have a parent or sibling facing a difficult diagnosis. With some policies, you can get a reduced payment on the death benefit early.
A viatical settlement allows a qualifying policyholder with a serious or terminal illness to sell an existing life insurance policy for a lump-sum payment. Those exploring accelerated benefits via settlement can use the proceeds for needs such as medical care, medications, household expenses, or other financial priorities.
Be ready for future medical needs
You don’t want long-term medical care costs to become an ongoing burden. When you review your budget and plan for future needs, you can keep your finances under control. Compare prices on caregiving options, look at life insurance settlements, and talk with your family members.
When you’re diligent about preparing, you can be ready for long-term care realities.
This content is provided for informational purposes only and is not a substitute for professional advice. AFP editorial staff were not involved in the creation of this content.
Share
