Tag Archive for: finances

How Does a Disability Impact Spending in Retirement?

For a variety of reasons, people who have suffered a disability before retirement age and after finding themselves having to manage their spending in retirement quite differently than if they had not had a disability. Let’s review the major reasons that a disability will affect retirement spending. 

 First, we will look at the pitfalls of a disability prior to full retirement age. 

As you know, full retirement age, according to the Social Security Department, is age 66 or over depending on your birth year. This age will allow you to qualify for Medicare and not be reliant on an employer plan. If you become permanently disabled prior to 65 Medicare qualifying age, then you may face additional cost for health insurance if you are not covered by another plan. Additionally, you may not be able to make additional savings in a retirement account, thereby reducing your retirement assets. Reduced income, as a result of leaving work early, may also mean you are tapping into retirement savings to meet everyday living or healthcare expenses. It may become even more daunting if you have a spouse who left work early to become a caregiver. All these things add up. And it not only affects your personal financial needs, but also those of your spouse and family. And don’t forget, to qualify for Medicare, prior to age 65 you have to be considered permanently disabled through the Social Security administration for 24 months (about 2 years) before qualifying for Medicare. 

Another barrier to income before full retirement age is Social Security. First you must have paid into Social Security for a period of time before you can qualify for Social Security benefits. If you do not have the required time, you will not qualify for social security at all. This, however, does not apply to the spouse of a social security beneficiary regarding spousal or survivor benefits. 

Now let’s review the effect of disability in retirement when you’re at full retirement age. At this point you automatically qualify for Medicare which gives you the assurance of health insurance. However, if you have a disability, you need to make sure that the Medicare plan you choose is going to cover your healthcare needs. Carefully review your options. Buying an additional Advantage plan or Supplemental plan with a stand-alone Prescription plan should also be included in your overall retirement expenses/costs. Patients that have a long-term illness as well as an expensive one such as cancer, need to be extremely diligent in controlling and managing the cost of their care. Careful due diligence must be maintained in understanding treatment cost, availability of care and type of care. 

Patients must also consider other healthcare needs and costs arising from the aging process. For instance, are you going to have to downsize your home and what kind of market are you going to find yourself in at that time? Long term planning is always a good practice when considering these things. Are you going to need long term care or nursing home care, and for how long? Where will the funds come from to manage these costs?  

Unlike years ago, when multigenerational families lived together and shared expenses as well as caregiving, we have long been in an age of “self-reliance” and autonomy. Which means the burden of caregiving is often difficult to acquire. A personal experience. 10 years ago, I lived in a community and subdivision of nineteen homes. Four of which housed multi-generational families, out of medical necessity. My husband and I even had plans drawn up for a large carriage house to be built on our property for his mother and mine in the event they needed to be near family for caregiving. It did not work out that way as my husband shortly after began his journey with Myeloma and I became his caregiver. And I did leave work for several years to be a caregiver for him. He retired early from his career, we spent more on healthcare as a result of his illness and our “planned retirement lives were forever changed as a result. We had planned, but even that planning fell far short of what was really needed for future healthcare needs. And the expenses and costs go far beyond the normal medical bills. 

What I have learned from my experience is to plan for the unexpected. Not only the cost of future healthcare expenses, but also, look at how to manage your financial lives if employment changes. Consider current and future housing needs. Are steps manageable, are doors and halls wide enough for wheelchairs, do you have access to bathroom and bedrooms that are easily accessible from outside? Do you need to consider moving to be near family?  

My suggestion is to look at scenarios and make achievable plans before you are in a crisis.  

It is true that hindsight is 20/20. If I could do it all over again with what I know now, planning for the future would have been considerably different. Now, as a widow, my needs have changed. Because I had to leave work for a period of time to care for my husband, I was no longer depositing into a retirement savings program. And because we spent so much of our retirement savings on his care, I am in makeup mode. I’m also considering my needs, imaging as well, as if I should find myself unexpectedly with an illness that may cause my early exit from the workforce. I have purchased Cancer insurance, reviewed, and expanded my life insurance portfolio, (not just for beneficiary needs) and purchased a home that I can age in. Though I am not yet 65, I am keeping abreast of Medicare changes so that I can make the right decisions when that time comes.  

It’s never too late to plan and make adjustments that can benefit you now and, in the future, no matter what your life status or health status is currently.  

How Medical Financial Hardship Can Affect Your Health

How Does Your Finances Affect Your Health?

In 2002, my husband was diagnosed with MGUS, a precursor to Multiple Myeloma. As many of you have also experienced, your life changes. At diagnosis, you probably felt you couldn’t breathe or process. All you could think of for days was cancer, cancer. And if you have been unfortunate enough to witness someone else in your family or close circle of friends with cancer you could only relate to their experience or what you thought their experience was. Good or bad..

I’ve witnessed too many people in my family battle cancer. My brother with leukemia, my father with lung cancer, my great grandfather with prostate cancer and my husband with multiple myeloma. I watched my parents struggle with the cost of his care. My mother was the caregiver to my father and stopped working to care for him. That was difficult for her because her sustainable income became almost non-existent. Fortunately, it came at a time when all but one of my seven siblings were independent and on our own. This at least was less responsibility for my mom and dad to worry about. However, because he was in the hospital a lot, and she no longer had income coming in, we all covered her daily expenses, food, mortgage, gas, water, purchased her a more reliable car, home repairs etc. We became her failsafe. Many people are not so fortunate.

My mother never spoke of the emotional or financial stress of everything to any of us, but we knew it had to be difficult. We saw the strain on her health. Her weight changed. She had trouble sleeping. Her blood pressure soared and her arthritis was always troubling her. More so than usual. My siblings who lived near would spend time helping her care for dad, and within a week of his death she had to take care of her mother who was an amputee and had Alzheimer’s.

So, it’s really not at all surprising to learn that medical financial toxicity or stress could be linked to worst cancer survival. The effects are many. Unfortunately for those who live in rural areas, have low incomes, those who are minorities, the underinsured or uninsured you already have financial stress. An expensive illness like cancer makes it all the more difficult.

My husband had great insurance from his employer. I thought at first we wouldn’t have to worry about medical bills. That is until he was at first approved for coverage for a stem cell harvesting and transplant in another hospital out of network, because there wasn’t a specialist in KY. Right after the transplant we were told treatment wasn’t going to be covered by his insurance.. After 5 weeks in the hospital!!! He became very despondent and depressed could not eat or sleep. He began to suffer with other emotional and physical issues unrelated to the illness itself. Additionally healing from the transplant was difficult. Lesson learned, having good insurance does not shield you from financial stress.

An analysis of 25,000 cancer survivors showed that financial hardship had a significant association with premature death among cancer survivors, no matter their insurance coverage. And according to K. Robin Yabroff, PhD, MBA, of the American Cancer Society in Kennesaw, GA and colleagues, almost 30% of patients ages 18-64 reported financial toxicity, which is associated with a 17% excess mortality risk compared with same-aged patients who did not report medical hardship.

In older patients, they found that financial hardship was less common with a 14% excess mortality risk. Having insurance did reduce the risk but not by much and certainly didn’t eliminate it.

An earlier study in the Journal of the National Cancer Institute found an increased mortality risk in cancer survivors who filed for bankruptcy. Though the number filing was low, medical financial hardship covers a range of economic stressors.

Some of the financial hardships associated with financial stress included; patients not adhering to or even forgoing treatment. Having problems paying for expensive prescriptions could lead to not taking medicine as prescribed to make it last longer or not getting it filled at all, In addition mental health counseling and other health issues are neglected.

How to mitigate a lot of the financial stressors that can lead to higher mortality?

Understand your illness and all aspects of your treatment. Ask your doctor to refer you to someone in the facility who can help you find financial assistance to help you manage the costs of your care and help you manage your everyday expenses. A quick google search can help you locate local, state and federal resources that may be available to you. Seek out help from organizations such as American Cancer Society, Leukemia and Lymphoma Society. There are many others. Get help with finances and budgeting CoPatient is a great organization that can determine of medical bills over $500 are accurate and fight that battle for you. Triage Cancer is a great resource to help you understand legal, and insurance information based on your state of residence.

The main takeaway is, you need to focus on healing and staying healthy. Seek out help regarding your finances so that you won’t find yourself in a financial crisis. Support groups are great sources of information.

Don’t be afraid to ask. Your health depends on it!

Is Inflation Adding to Your Financial Burden?

The stock market was doing well, until it wasn’t. For those of you who are invested in the market, things have been going splendidly for quite a while. Then comes the virus and job closures, people leaving their jobs for better pay. Home prices went through the roof. Many people made money selling their homes at a premium but then couldn’t find a home to replace it with. Rent is exploding. The cost of food is skyrocketing. You can’t find a decently priced used or new car anywhere. Sure, you can trade that used car you currently drive for a great return, but then spend the equity you made plus more into another car.  

How do you keep right-side up with all of the changes the world is enduring right now? 

Oh Yeah! Now we have a war to contend with and the fallout of it! How about gas prices soaring, way before the usual hikes around spring break and early summer 

Can you get a break? If you’re reading this you probably have already been struggling with the high costs of one of the biggest booms… Healthcare. This economic shift is a hard one. The gears are grinding and the brakes are shrieking.  

What are steps you can take to help mitigate, the best you can in your situation, the financial stress that comes from all of this uncertainty? 

Take a deep breath and I will give you some strategic steps you can take to help alleviate your financial stress and help you make the best of a difficult situation. 

First understand you cannot control what happens economically or politically, but you do need to be aware that there are risks that we can anticipate and be ready for.  

Here are some basic questions that you can ask yourself to help identify problem areas and then where to address these concerns so you can avoid financial toxicity.  

  1. What is your main area of concern?  
  2. Is it your ability to pay for healthcare?  
  3. Are you concerned that you may not have the insurance coverage you need? 
  4. Do you need help meeting your healthcare expenses? 
  5. Are you concerned about having to leave employment early due to illness? 
  6. Are you unsure of how to keep health insurance if you need to stop working? 
  7. Are you swimming in debt and need outside help managing it? 
  8. Do you need information about SSDI, or SSI 
  9. Are you having difficulty working due to your illness? 
  10. Do you need information about ADA and FMLA? 
  11. What resources do you have that you can use strategically to help you manage your overall expenses? 

I know this seems like a lot, but unless you identify your concerns it will be impossible to address your concerns effectively. Take a bit of time to ask these questions, write everything down and prioritize. Pull out your employer benefits booklet and get to know what options you have available to you through your employer. 

Get to know your insurance plan and what they are responsible for and what you are responsible for.  

Know what treatments you are on and their associated costs. Ask your treatment team if anything is expected to change so you can anticipate and prepare financially for the changes. 

If you haven’t done so already, ask your social worker about financial resources that you may be eligible for to help pharmaceutical drug costs as well as financial assistance programs through nonprofits and charitable organizations.  

There is help out there for food, utilities, medical bills, rent, insurance premiums, drug costs, travel for medical care and a host of other state and local resources. Now is a good time to take advantage of the resources. If you have a low income, you can even seek help through Legal Aid Society at no cost to you for legal help.  

Don’t let financial stress keep you from staying on your medical treatment or from keeping your lights on and food in your refrigerator. Ask for help. Seek out resources that can help you and your family.

Financial Fitness Workouts

From PEN-Powered Activity Guide VIII: Supporting Your Support System


It seems every day we’re being bombarded with ways to stay fit. there is always a new fitness program or a new types of fitness equipment that’s supposed to give us the best bodies we can have. But with those who are dealing with a chronic illness, fitness takes on a different meaning. Not only do we need to feel our best physically, we also must be prepared in every aspect of our lives with your sight always set on your best possible treatment and your continuum of care.

I thought this would be a great time to review four of the most impactful areas you can review, reallocate, and make the changes that are most appropriate for your specific circumstance.

A good way to look at it is, in the fall we make sure we perform maintenance checkups or in our furnaces. We prepare our gardens and lawns for the upcoming spring, we check the exterior for homes for energy efficiency and we do checkups on our cars to prepare them for the winter season.

Unfortunately, few of us take the time to review the foundations of our financial lives that in fact dictate our ability to remain on treatment plans and meet all of our financial obligation. It is my hope, that everyone takes the opportunity to review at least these four areas that I’m covering in this article before the end of the year.

Medicare

First, the big one for a lot of us, Medicare. As you know the Medicare season is almost upon us. And there are changes as there are every year. If you are already a Medicare enrollee, this open enrollment period gives you the opportunity to make changes if needed. And if you have been enrolled for 12 months or less and you have a Medicare Advantage plan you even have the opportunity to replace it with a Supplemental plan perhaps with guarantee issue If you qualify. Here may be a wait period but you may not be able to get in at a later date and the coverage may be better for you.

Also, if you have an HMO plan you may be able to switch to a PPO for more plan flexibility. Review your Prescription formulary if there have been changes to your treatment. The worst thing you can do is to not review your Medicare options as there are changes every year and more plans may be available to you and the cost may be better as well. Don’t assume that the cheaper the premium the better off you are. Review your total cost. That includes the premium, co-pays, deductibles, coinsurance, and the cost of your meds as well.

Life Insurance

Secondly, review your life insurance plan. Many people aren’t aware of the benefits that insurance offers. Such as, accelerated benefit riders in the event you need access to some cash or the options of taking a loan from your policy.

Additionally, if you are still employed, on your next enrollment period with your employer see if you can add or increase your life insurance amounts. Even if you plan to retire or terminate your employment next year or at a later date the cost to take life insurance with your employer may be the only place you qualify without medical underwriting and it’s much cheaper. Also, see if your employer offer a supplemental life insurance that you can enroll in that may be portable at your termination from employment.

Review your credit to make sure there isn’t anything on it that’s incorrect. If you anticipate making a big purchase this will really affect your interest rate.

Monthly Statements

Third, as a financial advisor, I found a lot of clients would not look at their monthly statements to see how their retirement accounts such as 401k’s and investment accounts were doing. You are doing yourself a huge favor if you keep up with these no matter if the market is up or down. Speak to your financial advisor to make sure you’re taking advantage of growth, income producing, and tax efficient opportunities.

Financial Assistance

And finally, don’t assume you won’t qualify for financial assistance. The cost of treatment is expensive and probably always be. Talk to your doctor or social worker to help you uncover sources that can help you pay for co-pay, deductibles, coinsurance and other needs.

Do this before you find yourself in a financial crisis. Be proactive with understanding your illness and the anticipated change in treatments that may be available for you.

Instead of waiting for spring cleaning, take the time to do a financial review now. Go into the new year in the best possible position you can. And then, like getting a check-up on your car, do the same for your financial future every year. After all, you are worth more than a car!!

The Difference Between Wanting and Needing: Redirecting and Prioritizing Spending

Often when I am out shopping, I find myself picking up items that I think I really need. I justify it rather quickly and find myself with buyers’ regret shortly thereafter. The most irritating habit I have is not returning it to the store and getting my money back. Last week, I was cleaning out drawers and found a few bags of clothing that I had every intention of returning but it escaped my attention. I also found dresses, jeans, shoes, several coats, and a suit that had purchased but forgot about. Some of them for my granddaughter who now had long outgrown them and for me, well I thought I needed them.   

I’ve also gone through storage and closets and found household items that “I really, really needed” at the time, but there they were never opened or rarely used some with the sales tags still attached. I thought I should add up the costs of these items and see just how much money I had wasted. It had added up to over a thousand dollars. Yes, I will donate these things to a charity such as a homeless facility, and, it makes me realize it can be a blessing to others, but is there a better way to serve than by happenstance? Am I doing a disservice to myself by spending without being mindful of where my dollars are going? I would argue that both are true.   

I’m learning to be mindful of all of my spendings. It’s making me prioritize my needs and wants. This is especially important when you have ongoing medical bills and prescriptions to manage and pay for. They can seem to be overwhelming at times. Though, I don’t have high medical bills currently, I do recognize that may not always be the case. So, diverting some money into an HSA or a regular savings account for the sole purpose of this future need could help me in the future. You can look at it as investing in yourself or, ” paying yourself first.”  

We all have bills to pay but rarely do we see ourselves as important as one of those bills. Consider setting aside $15 to $25 every pay period for medical expenses. Or, if you have bills that are already outstanding, call the service provider and request to pay a little toward those bills every month. You may be surprised how little they may be willing to take. They are in the business of service and you are their customer. Trust me, they don’t want you to leave. By putting a little each month towards the bills can help you stay in good standing with the medical provider and can help keep the bill from going to a collector and from hitting your credit report.   

Also, do what I did. Look around your house for things you no longer need or don’t want. Consider selling them. Not only will you be freeing up space at home, but you can also make some cash. There are online selling apps like OfferUp, BookScouter, eBay, and more. Terminate subscriptions you no longer need. Pay especially close attention to online subscriptions you may have forgotten about.   

Another creative way of finding more cash is to always make change when buying something at the store. Everything in coin change put in a jar. Deliberately seek out change-making opportunities. You may be surprised at how much you save. I did and saved almost $800.00 in a year.   

Consider online banks that may offer more interest than perhaps your neighborhood bank. Buy only what you’re going to eat. A study published in the American Journal of Agriculture Economics found that the average household wasted 31.9% of its food. The US total annual cost of wasted food was estimated to be $240 billion or $1,866 per household.  In fact, wasted food is the largest component taking up space in US landfills. And the United States discards more food waste than any other country.  That adds up to 30-40% of the entire US food supply. So, don’t waste and keep that money in your pocket.   

Spending comes down to desiring to satisfy oneself, however temporarily, and often supersedes logic. It’s impulse buying. Even when we know we should be directing our money to important things such as; managing the costs of healthcare, utilities, etc., it’s often difficult to stop wasteful spending. And the temporary feelings of satisfaction quickly wear off when bills start coming in.   

Getting control of this habit is achievable and not really complicated. Create a reasonable budget. Start by keeping a record of EVERYTHING you spend for a month. This may take a bit of work but is well worth the effort. Make a list of all your bills, including anticipated medical bills. Are you spending more than you make? I’ve found that when putting this down in writing, when you see it, it becomes real and important.  Putting together a budget is actually very freeing. It will allow you to reduce impulsive discretionary spending and allow you to focus on getting a firm grasp on your financial life. And, the payday of reduced financial stress is like icing on the cake.  

Making the Hard Decision to Move Forward

It may not come as a surprise to many of you that making new changes in your life can be difficult. And it is the natural human tendency to procrastinate even when we know that taking that first step will lead to better outcomes. Indecision can be costly, physically, financially, and mentally. This new environment in which we suddenly find ourselves is a testament to the need to make fast and drastic changes as our very lives depend on it.  And we have to manage this unfamiliar ever-changing changing COVID environment for some time to come. And for those of you who are immunocompromised, they may be even higher. 

Now, let’s take a look at another life and death struggle that we are in every day that takes up much of our time, energy, and leaves us stressed. The fear of financial ruin. What I have found is that even in the best of times, we don’t want to recognize our financial weaknesses, no matter how they have come about. And there is something to be said about being careful with that information. Now with the national and global financial volatility we find ourselves in with no foreseeable bottom or end in sight, not speaking to someone about your financial concerns and addressing them can leave you in a more desperate financial situation than you may already find yourselves in.  

 

I find it challenging to help anyone who has questions they want to ask but don’t know how when they should ask, or even know what questions to ask. Let me reassure you, I am available to help you navigate your financial lives. I am an advocate for you, not the hospital, not the treatment center, not your doctor, but for you. I endeavor to help prevent and or reduce financial stress/toxicity which is the predominant concern when dealing with a chronic illness. If you feel that paying for your medications, or medical treatment bills is putting a strain on your finances, please call me. Even if you feel everything is manageable now but may become difficult in the future, call me. Don’t wait until the bottom falls out to seek help. You may have had your treatment changed as a result of not being able to go into the doctor’s office for treatment. (intravenous vs oral meds). Is this new treatment going to cost you more?  

Now that some people are beginning to be more open to seeing their doctors, a sad reality is showing itself. Some of these people who put off important follow-up visits, tests, or initial visits due to COVID exposure fears or increased costs-share burden, are finding themselves in more dire physical condition. Perhaps other illnesses have worsened or a new illness in a more advanced stage.  

Let’s not become a statistic. Having a conversation with a financial professional can reassure you that you are on the right track or reveal weaknesses in your financial armor that can be addressed. Getting in front of your healthcare expenses, being proactive in your insurance plans, and making sure your financial goals are secure is one of the most important steps to not only meeting your household financial obligations but your healthcare objectives as well.  

To Retire or Not to Retire: Securing Your Financial Future and Avoiding Financial Toxicity

This is continuing to be an extraordinary time in our history. We don’t know what is coming down the line five, ten, or fifteen years from now. But what you can expect is, that in some form, there will always be economic challenges that we will experience. Few people are alive that experienced the 1918 pandemic. This during the height of WWI.  The world soon after experienced the great depression from 1929 to 1939. And in the mists of that in the 1930’s a big swath of our country experienced the Dust bowl which intensified the crushing economic impacts of the great depression. We can look at this from a global perspective or really look at how situations like this can affect us personally. Think about 2008-2009 when the world suffered from the market crash as a result of the subprime mortgage crisis. The resulting loss of jobs and interest rates at 0% the first time in history was a precursor in a way to what we are experiencing now. At least how we seem to be managing the economic fallout.  

How is it affecting you personally? What does this have to do with you? I can tell you that as a financial advisor, I saw firsthand how many people suffered financially, I also witnessed how many people did not suffer the economic crisis at all or minimally in 2008-2009. And surprisingly, it did not necessarily matter how much money they had.  What separated them from people who suffered is, they understood that things were not always going to be good. They knew there was going to come a time when the market would have big market fluctuations or corrections. They were prepared with cash reserves and their assets were positioned to withstand these fluctuations. Let’s look at this from the perspective of a cancer patient. You have and may be experiencing the uncertainty of the health insurance market as well as it’s associated cost. Not to mention the ongoing rumors of changes to social security and Medicare. You may also be contemplating not going back to work and retiring early or are ready to go on Medicare.  

This is an important crossroads in your life. You want to make sure that you are making the absolute best decision. This would require you to look really close at your financial house. What kind of debt do you have? What kind of health insurance do you have and will you have if you left work early? What is the associated ongoing cost? What benefits will you be giving up? Income for sure. Can you continue to live on the reduced income? When will you be able to take social security? Will you need to have supplemental income? How can you pay off debt now so that it won’t eat up retirement income? What’s the best kind of debt to have? Who else in your household will your early retirement effect and how? Have you included inflation in your retirement income calculations if you’ve planned at all? Have you consulted with a professional to help you navigate the ongoing rise in healthcare cost in your financial lives?  

I know this is a lot. And as a cancer patient you are well aware of the high costs associated with your care. And, financial toxicity overwhelms cancer patients more than any other illness.  

Just as you go to an expert for your cancer care, It is important and I would say necessary, for you to seek out the help of a professional for your financial health. Let go of the idea that you can do it yourself. Honestly, you can’t afford to be wrong. If you’re older you usually cant make up monetary mistakes. and If you’re retired, it isn’t easy to go and just pick up a job. If you’re ill it’s even more difficult.  

Review your life insurance policies and how your assets are working. Professionals can assist you with recommendations to help you generate more income if needed or help you manage taxes. Many even plan for healthcare cost throughout your retirement. They can help you with social security, disability, budgeting and all things financial.  They will ask you questions and bring up things you had no idea that could derail your financial life.  

Look at all of your spending. Let go of all the things that are wasteful. Instead redirect it into a cash reserve account or pay off card debt or put into an account to pay for medical necessities.  

Again, reconsider seeking out a financial professional to review and find the weaknesses in your financial picture. They all work differently, and charge differently as well. But  believe me, it’s well worth delving into.