Even if you save during your working years for retirement, you might not be financially prepared for the costs of medical expenses when you are retired. Wherever you are in your preparation for your retirement, it is critical to be able to plan for and understand the costs of medical care. You have several options.
Put More Money Aside
Of course, the most obvious option is to put more money into your retirement accounts, so you have more once you quit working. Cutting down your monthly expenses can help you have more cash to put aside. You may consider cutting down on subscriptions, vacations, or going out to eat, and if you have debt from school, consider refinancing it into a new one to cut down on monthly expenses. A side hustle can also bring in more money that you can then put into retirement. While you may feel that working another gig will only lead to burnout, finding something you enjoy doing can help prevent burnout. Working a seasonal gig, like finding something during the summer, can help you avoid having to hustle year-round.
Consider a Health Savings Account
If you have spent a significant amount of time learning how to be successful in life don’t you think you owe it to yourself to spend time learning how to optimize and protect that success? A health savings account is something that can be acquired through a high-deductible plan, and they often have some tax advantages. You can often deduct your contributions, withdraw the funds tax-free, and allow them to grow on a tax-deferred basis. The money is able to be used for certain health care premiums. If you are in your 50s, you can often maximize your plan by using making catch up contributions on top of what you are already putting in. If preventative care is not already covered in your health insurance plan, you can use the funds from the HSA for this type of care.
Look to Long-Term Care Insurance
Consider getting long-term care insurance, which can be helpful if you ever need care at a nursing home or assisted living facility. Of course, the premium might not be low enough for every patient, but you might be able to get some coverage through your life insurance. By getting this type of coverage when you are younger, you can lock in more affordable premiums.
Find Ways of Managing Health Care Expenses
There are lots of ways to cut down on health expenses so you will have more left for the high bills. Consider using a preferred pharmacy, where you might have lower copays or you could ask your doctor about generic medications if you aren’t already using them. There are also websites that offer discounts and coupons for patients able to pay with cash. No matter how much or little you have to pay for care, it is a good idea to be smart with your shopping. You should take ownership of your healthcare, even though you may not need to cover the whole cost. Instead of just doing what your doctor says, ask what all your options are and do some of your own research. Focusing on preventative care now can help you stay healthier, even once you are retired.