Well, I get your point on that. The funny thing is, until you live outside the good old US of A for extended amounts of time, you don't actually realize how much you're being ripped off on hospital fees. In Ireland, for example, any insurer will sell you full benefits insurance for about 500 euro a year. That's everything excluding dental; and if you're prepared to put in a bit more, you can get day-to-day doctor visits and medications added.
Even when you pay as a tourist it's nowhere near as expensive as any operation in the US (hospital care is free here if you're an eu citizen, and the quality of the public hospitals is almost on par with the best private hospitals).
Perhaps what should really be getting done is more protests on the cost of healthcare - this would surely reduce everyone's burdens.
Great post- as a Brit currently in Canada (now on the lookout for beady eyes and flapping heads!) health insurance is the only reason we haven't considered moving to the States.
As someone with the misfortune to develop a (potentially severe) chronic medical condition at 21, I'm not even sure I could get coverage there, I'm fairly certain I wouldn't be able to afford it if I could.
As it is I'm pretty hopeful about early retirement through frugal living in either the UK or Canada.
There are so many reasons that Canada is evil that it would take an entire web site and many, many hours to chronicle their savage nature and insidious ways. Suffice it to say with their beady eyes and flapping heads, Canadians are a pox on all that is true and good.
I can attest to the sublime ease of a frugal life. But then I live in Canada and just graduated (with no debt, health care isn't the only thing cheaper here) so frugal living is relatively easy. I certainly don't envy those who don't have the choice of this kind of lifestyle.
Someone who makes $100,000 and spends $50,0000 is safer than someone who makes $15,000 and spends $10,000. He is able to absorb $50,000 worth of bad luck in a year while the simple living person can not.
I work in health care and I know we could do better by copying some other countries that have efficient systems.
"That other blog" that we both read would be 100% valid in most countries, but you're taking a big risk if you retire young in the US.
The current scheme, where insurance is generally available to people with good jobs (but not otherwise), is turning into a terrible burden for companies. Fifteen years ago, they opposed any sort of government health care program for two reasons. First, they wanted to be in control of what health care services they would offer. Second, they thought (especially the larger companies) that they could gain a competitive advantage in hiring by offering better insurance coverage.
I think virtually every company has changed its mind by now. They see the costs of health insurance for their employees as a terrible competitive disadvantage compared to foreign companies (whose employees get free health care from the government).
The problem is not an unwillingness to pay for health care; the problem is that the burdens fall so capriciously. The cost of health care is very reasonable for almost everybody. But for a few people it's so high as to bankrupt them. That's a perfect situation for insurance--spread the risk. The problem is that we let insurance companies cherry-pick the healthy people. (Health insurance is incredibly profitable, if you only insure healthy people.)
The problem could be easily solved by requiring insurance companies to offer simple rate charts, the way they do for other kinds of insurance.
Beyond that, we could save everyone a lot of money with a single-payer system. (Americans pay twice as much for their insurance coverage as most European countries, without it making them any healthier or live any longer.) But that's not necessary. All that's required to solve my problem is to require insurance companies to offer insurance to sick people on roughly the same terms they offer it to healthy people. They won't like it--they'll claim that insuring sick people will bankrupt them. But I don't think the insurance industry has nearly as many friends as it did 15 years ago.
In January I was charged over $3,000 for an emergency room visit while on vacation in San Francisco. My treatment consisted of one saline IV and one dose of anti-nausea medicine. I was billed $3,000 AFTER insurance. When I called the hospital and told them my annual income was only $12,000, the only thing they did was offer to let me make monthly payments for the next two years. I'm guessing they won't offer you any help if you don't know what to ask for. I'm going to call them first thing in the morning to pursue this further.
... to be free NOT to pay for your healthcare when you get sick and decide that "whoops! I still want to stay alive even though I can't afford to pay the doctors to keep me that way."
Seriously, the problem you describe is caused by "compassion" for the poor. The day we decide that hospitals can turn people away to die is the day you'll be free.
Right on! The health insurance issue is the ONLY thing that has kept me on the job for lo, these many years. It will keep me on the job until I'm 65, even though in theory I could have retired long before now.
Unfortunately, I have say no. I'd shop where I could get the best price. In an ideal world, I'd support the local merchants. But I have to support my family first and especially in this economy, that means buying what is cheapest.
It's good to remember that when you choose a job you are often also choosing a lifestyle that goes along with it - And the people you are hanging out it a good deal of your time. These can all be taken into consideration when thinking about lifestyle vs. work.
Keeping up with the Joneses happens because people allow it to infect their mentality. I think it also has to do with insecurity.
We are frugal people, but pride ourselves on being smart with our money. Savings and debt are first priorities, then material goods. I have not always been like this; in my 20s I worked in the entertainment industry in LA and succumbed to the pressure to dress to impress. I went broke doing it and it took a long time to catch up. But fortunately, I've gotten over this. Being an entrepreneur and having a family will do that sometimes.
In 2 weeks, we are moving from Los Angeles to 20 miles outside Philadelphia in order to scale back our lives. Not quite rural, but for us, it's a huge step towards a simpler life. I can't wait!
I can understand where you are coming from, as we have also chosen a lifestyle that's less demanding of our resources. We have all the insurances one would consider necessary to be secure, but even that doesn't seem like enough.
For many, financial security has a certain amount of risk that can never truly be eliminated. We can mitigate damages by being insured, but certain unforeseen acts (tornadoes, hurricanes, war, poltical upheaval, disease, etc.) are always going to catch people unprepared. Often those with the most money are hit the hardest, as certain conditions can leave money without any true "value."
I say live at whatever level you are truly comfortable with, and don't waste your whole life preparing for the unknown. It's good to be smart about it, but I'd rather not work my fingers to the bone while missing out on all the joys of life simply so that I can be "fully-prepared" for the unpredicable, and often "inevitable."
Great, thought-provoking post (even though it's way too deep for a Monday) !
Of course it would require a large amount of trust and working together, but if everyone is in it for the common good, then it makes sense... also, it's not about gambling that someone will make money on their business, it's about setting aside the money each month, but using a structure other than a bank. Of course, it would be very hard for one of the first people to keep contributing if they had already gottent heir money and then squandered it...
Tax is a key part of America's existence, perhaps even more than religious freedom (well, freedom from persecution).
What is also interesting is to see the actual tax rates across time. One thing seems to be certain: the more wars we have, the more taxes will increase.
Health insurance is pretty much what keeps me from being self-employed. No one wants to insure diabetics, even healthy ones like myself. It's ALMOST enough to make me want to move to Canada. But then I remember how evil Canadians are.
I live in California, which is very car-centric as places go, but the rising gas prices are making people think twice about the way they get from place to place. My mother, who lives in a retirement community, just bought a golf cart and uses it to go to the store and other short jaunts. The only problem is that it doesn't have an air-conditioner so she has to wait till later at night to go when it's cooled down.
The main dificulty is finding streets and carts that will be compatable- many streets here are 40mph and the carts are only rated to 35mph when street-rated.
I only recently found Kayak, but I've been very impressed with their fair sleuthing. Travel Zoo is something I've subscribed to for a while now, and it is also a great way to find deals- but you have to be ready to move when they post a special.
Emergency Relief organizations should cut a deal with the bucket company - this makes much more sense than dealing out huge soup kitchens in ravaged areas... espceially when transportation can be limited.
When I got my first credit card, I used it to pay for everything. It was going fine, paying off the balance every month, until I had to change jobs and my pay dropped. Because I was putting it on credit card, it was fine for a while, but then my expenses began to wrack up. Because I was late with a payment, intrest rates went through the roof and my payments skyrocketed and I started paying only the minimum and living off my income above that. I ended up going into collections with the credit card companies.
Since then I've paid off the collection companies and I'm working on rebuilding my credit, but I'll never charge everything to my credit card again. I'm just grateful that I hadn't been charging a mortgage payment on that because it would have made my bills that much higher.
One of the comments suggested having enough cash to cover your credit line- I think that's really the only way to go. Thanks for the great idea. When I get my finances back around to good, I'll have to do that with any new credit cards I get.
Nice work, a good read! I will, however, mark one notable exception. You do not have a legal obligation to keep your creditor advised of you address and/or other contact information (Privacy concerns pervade here). Contractually, you have an obligation to pay the debt under such terms as were lawfully agreed. Period. You touched on it, in that it may be to your advantage down the road to keep your creditor advised as to your whereabouts, but again, there is no legal responsibility implied or otherwise.
Thanks for raising that point, Julie. I'm not sure how many other business models work with flexible contracts like loans - whenever my cable bill goes up, I call to cancel, and they try desperately to keep me as a customer by dropping my monthly payment.
Look, I understand the whole "greedy American assholes and their credit cards" line of thinking, but the point isn't just that we should pay down our cards blah blah blah (I've talked endlessly about this before), but that people who, for whatever reason, need or choose to carry a revolving balance for a while shouldn't have their purchases tracked and penalized by their lenders. Especially because it's the lenders' fault that they (the banking institutions) are in such dire straights right now.
I, too, was told to keep a small revolving balance on my credit card when I first got one in high school. I charged something like $100 and paid it of in $20 increments, and I had stellar credit - who knows if the revolving part had anything to do with it? I've talked to a few other friends who have told me that they were given the same advice. However, it seems this isn't conventional thinking these days, and obviously no one should want to pay interest. I don't advise anyone carry a balance on their credit cards, but that doesn't mean that it's never going to happen or that interest rates should shoot up should someone need to exercise that line of credit.
Well, I get your point on that. The funny thing is, until you live outside the good old US of A for extended amounts of time, you don't actually realize how much you're being ripped off on hospital fees. In Ireland, for example, any insurer will sell you full benefits insurance for about 500 euro a year. That's everything excluding dental; and if you're prepared to put in a bit more, you can get day-to-day doctor visits and medications added.
Even when you pay as a tourist it's nowhere near as expensive as any operation in the US (hospital care is free here if you're an eu citizen, and the quality of the public hospitals is almost on par with the best private hospitals).
Perhaps what should really be getting done is more protests on the cost of healthcare - this would surely reduce everyone's burdens.
Great post- as a Brit currently in Canada (now on the lookout for beady eyes and flapping heads!) health insurance is the only reason we haven't considered moving to the States.
As someone with the misfortune to develop a (potentially severe) chronic medical condition at 21, I'm not even sure I could get coverage there, I'm fairly certain I wouldn't be able to afford it if I could.
As it is I'm pretty hopeful about early retirement through frugal living in either the UK or Canada.
There are so many reasons that Canada is evil that it would take an entire web site and many, many hours to chronicle their savage nature and insidious ways. Suffice it to say with their beady eyes and flapping heads, Canadians are a pox on all that is true and good.
Also, Pamela Anderson. The prosecution rests.
I can attest to the sublime ease of a frugal life. But then I live in Canada and just graduated (with no debt, health care isn't the only thing cheaper here) so frugal living is relatively easy. I certainly don't envy those who don't have the choice of this kind of lifestyle.
Someone who makes $100,000 and spends $50,0000 is safer than someone who makes $15,000 and spends $10,000. He is able to absorb $50,000 worth of bad luck in a year while the simple living person can not.
I work in health care and I know we could do better by copying some other countries that have efficient systems.
"That other blog" that we both read would be 100% valid in most countries, but you're taking a big risk if you retire young in the US.
@Dangerman:
Oh, I think it probably will happen.
The current scheme, where insurance is generally available to people with good jobs (but not otherwise), is turning into a terrible burden for companies. Fifteen years ago, they opposed any sort of government health care program for two reasons. First, they wanted to be in control of what health care services they would offer. Second, they thought (especially the larger companies) that they could gain a competitive advantage in hiring by offering better insurance coverage.
I think virtually every company has changed its mind by now. They see the costs of health insurance for their employees as a terrible competitive disadvantage compared to foreign companies (whose employees get free health care from the government).
The problem is not an unwillingness to pay for health care; the problem is that the burdens fall so capriciously. The cost of health care is very reasonable for almost everybody. But for a few people it's so high as to bankrupt them. That's a perfect situation for insurance--spread the risk. The problem is that we let insurance companies cherry-pick the healthy people. (Health insurance is incredibly profitable, if you only insure healthy people.)
The problem could be easily solved by requiring insurance companies to offer simple rate charts, the way they do for other kinds of insurance.
Beyond that, we could save everyone a lot of money with a single-payer system. (Americans pay twice as much for their insurance coverage as most European countries, without it making them any healthier or live any longer.) But that's not necessary. All that's required to solve my problem is to require insurance companies to offer insurance to sick people on roughly the same terms they offer it to healthy people. They won't like it--they'll claim that insuring sick people will bankrupt them. But I don't think the insurance industry has nearly as many friends as it did 15 years ago.
In January I was charged over $3,000 for an emergency room visit while on vacation in San Francisco. My treatment consisted of one saline IV and one dose of anti-nausea medicine. I was billed $3,000 AFTER insurance. When I called the hospital and told them my annual income was only $12,000, the only thing they did was offer to let me make monthly payments for the next two years. I'm guessing they won't offer you any help if you don't know what to ask for. I'm going to call them first thing in the morning to pursue this further.
... to be free NOT to pay for your healthcare when you get sick and decide that "whoops! I still want to stay alive even though I can't afford to pay the doctors to keep me that way."
Seriously, the problem you describe is caused by "compassion" for the poor. The day we decide that hospitals can turn people away to die is the day you'll be free.
Ain't gonna happen.
How exactly are Canadians evil? Except for the fact that they hate Americans.
Right on! The health insurance issue is the ONLY thing that has kept me on the job for lo, these many years. It will keep me on the job until I'm 65, even though in theory I could have retired long before now.
Unfortunately, I have say no. I'd shop where I could get the best price. In an ideal world, I'd support the local merchants. But I have to support my family first and especially in this economy, that means buying what is cheapest.
It's good to remember that when you choose a job you are often also choosing a lifestyle that goes along with it - And the people you are hanging out it a good deal of your time. These can all be taken into consideration when thinking about lifestyle vs. work.
It sounds like this post is advocating a simplier life.
I'm for that!
http://www.ourstockmarketjourney.blogspot.com/
Be well.
Keeping up with the Joneses happens because people allow it to infect their mentality. I think it also has to do with insecurity.
We are frugal people, but pride ourselves on being smart with our money. Savings and debt are first priorities, then material goods. I have not always been like this; in my 20s I worked in the entertainment industry in LA and succumbed to the pressure to dress to impress. I went broke doing it and it took a long time to catch up. But fortunately, I've gotten over this. Being an entrepreneur and having a family will do that sometimes.
In 2 weeks, we are moving from Los Angeles to 20 miles outside Philadelphia in order to scale back our lives. Not quite rural, but for us, it's a huge step towards a simpler life. I can't wait!
I can understand where you are coming from, as we have also chosen a lifestyle that's less demanding of our resources. We have all the insurances one would consider necessary to be secure, but even that doesn't seem like enough.
For many, financial security has a certain amount of risk that can never truly be eliminated. We can mitigate damages by being insured, but certain unforeseen acts (tornadoes, hurricanes, war, poltical upheaval, disease, etc.) are always going to catch people unprepared. Often those with the most money are hit the hardest, as certain conditions can leave money without any true "value."
I say live at whatever level you are truly comfortable with, and don't waste your whole life preparing for the unknown. It's good to be smart about it, but I'd rather not work my fingers to the bone while missing out on all the joys of life simply so that I can be "fully-prepared" for the unpredicable, and often "inevitable."
Great, thought-provoking post (even though it's way too deep for a Monday) !
Of course it would require a large amount of trust and working together, but if everyone is in it for the common good, then it makes sense... also, it's not about gambling that someone will make money on their business, it's about setting aside the money each month, but using a structure other than a bank. Of course, it would be very hard for one of the first people to keep contributing if they had already gottent heir money and then squandered it...
-Suz
Tax is a key part of America's existence, perhaps even more than religious freedom (well, freedom from persecution).
What is also interesting is to see the actual tax rates across time. One thing seems to be certain: the more wars we have, the more taxes will increase.
Health insurance is pretty much what keeps me from being self-employed. No one wants to insure diabetics, even healthy ones like myself. It's ALMOST enough to make me want to move to Canada. But then I remember how evil Canadians are.
I live in California, which is very car-centric as places go, but the rising gas prices are making people think twice about the way they get from place to place. My mother, who lives in a retirement community, just bought a golf cart and uses it to go to the store and other short jaunts. The only problem is that it doesn't have an air-conditioner so she has to wait till later at night to go when it's cooled down.
The main dificulty is finding streets and carts that will be compatable- many streets here are 40mph and the carts are only rated to 35mph when street-rated.
- Suz
I only recently found Kayak, but I've been very impressed with their fair sleuthing. Travel Zoo is something I've subscribed to for a while now, and it is also a great way to find deals- but you have to be ready to move when they post a special.
Thanks for the review of AirNinja!
-Suz
Emergency Relief organizations should cut a deal with the bucket company - this makes much more sense than dealing out huge soup kitchens in ravaged areas... espceially when transportation can be limited.
-Suz
When I got my first credit card, I used it to pay for everything. It was going fine, paying off the balance every month, until I had to change jobs and my pay dropped. Because I was putting it on credit card, it was fine for a while, but then my expenses began to wrack up. Because I was late with a payment, intrest rates went through the roof and my payments skyrocketed and I started paying only the minimum and living off my income above that. I ended up going into collections with the credit card companies.
Since then I've paid off the collection companies and I'm working on rebuilding my credit, but I'll never charge everything to my credit card again. I'm just grateful that I hadn't been charging a mortgage payment on that because it would have made my bills that much higher.
One of the comments suggested having enough cash to cover your credit line- I think that's really the only way to go. Thanks for the great idea. When I get my finances back around to good, I'll have to do that with any new credit cards I get.
-Suz
Show that kind of attitude DURING the interview and you're in ;>
Nice work, a good read! I will, however, mark one notable exception. You do not have a legal obligation to keep your creditor advised of you address and/or other contact information (Privacy concerns pervade here). Contractually, you have an obligation to pay the debt under such terms as were lawfully agreed. Period. You touched on it, in that it may be to your advantage down the road to keep your creditor advised as to your whereabouts, but again, there is no legal responsibility implied or otherwise.
Thanks for raising that point, Julie. I'm not sure how many other business models work with flexible contracts like loans - whenever my cable bill goes up, I call to cancel, and they try desperately to keep me as a customer by dropping my monthly payment.
Look, I understand the whole "greedy American assholes and their credit cards" line of thinking, but the point isn't just that we should pay down our cards blah blah blah (I've talked endlessly about this before), but that people who, for whatever reason, need or choose to carry a revolving balance for a while shouldn't have their purchases tracked and penalized by their lenders. Especially because it's the lenders' fault that they (the banking institutions) are in such dire straights right now.
I, too, was told to keep a small revolving balance on my credit card when I first got one in high school. I charged something like $100 and paid it of in $20 increments, and I had stellar credit - who knows if the revolving part had anything to do with it? I've talked to a few other friends who have told me that they were given the same advice. However, it seems this isn't conventional thinking these days, and obviously no one should want to pay interest. I don't advise anyone carry a balance on their credit cards, but that doesn't mean that it's never going to happen or that interest rates should shoot up should someone need to exercise that line of credit.