illness

5 Ways to Boost Your Financial Resilience

Denise Hill — Tue, 20 Mar 2018 09:00:06 +0000

The ability to bounce back after being financially sucker punched is a necessity in today's volatile financial climate. It's safe to say that at some point in your life, you are going to face a financial crisis. It could come in the form of a job loss, an unexpected pregnancy, a health crisis, divorce, death of a loved one, identity theft, a global recession, the stock market tanking, an act of God … you get the picture. And the most troublesome thing about a financial crisis is it is usually unexpected and beyond your control.

The ability to survive and recover from a significant financial setback depends on how well you are prepared before disaster strikes and how flexible and proactive you are during and after the event. While you can't predict, control, or prevent financial catastrophes, there are a few things you can do to increase your financial resilience.

1. Prepare

According to a 2017 report by GoBankingRates, 39 percent of the 8,000 Americans surveyed had zero savings — and 57 percent had less than $1,000 set aside. That means nearly two-thirds of the people surveyed could not withstand a significant financial setback.

Your ability to rebound after a major money event is directly proportionate to your financial health before the event occurs. If you have little or no money saved, have lots of debt, and fail to live by a budget, you significantly extend your recovery time.

All of the standard financial best practices — budgeting, establishing an emergency fund, keeping your debt-to-income ratio low, and living below your means — increase your financial resilience. Financial irresponsibility is costly, both now and long-term. Start working now to improve your financial situation. Establish a solid emergency fund, lower your cost of living, and pay off as much debt as possible. (See also: 7 Easy Ways to Build an Emergency Fund From $0)

2. Practice

In the world of competitive sports, practice is important for three reasons. First, it prepares you for competition. Second, it creates muscle memory and habits. And third, it predicts future performance. In other words, you perform how you practice. This same thinking should be applied to your finances.

How does one practice for a financially stressful event, you ask? The first thing is always, always, always live by a budget. Budgeting gives you the power to see and decide where your money goes. You should make it a habit to establish a system of budgeting and tracking every dollar you receive and spend. It establishes a habit of being financially proactive which is pivotal in a crisis.

Another way to practice for a financial surprise is by running regular "practice drills." A few times a year my husband and I engage in what Michelle Singletary, nationally syndicated columnist for The Washington Post, calls a financial fast. During our fasts, we cut out all unnecessary spending and only buy the absolute necessities for a short period of time (about a month). We tighten our belts and live as frugally as possible. We usually wind up saving an extra $200–$400 on top of what we already save. It allows us to see the areas where we can cut back and it keeps us in the habit of adjusting our spending and living on less. (See also: Here's How a Spending Ban Can Help (and Hurt) You)

3. Don't panic

When a financial storm does arise, don't panic. The worst thing you can do is to act prematurely and while under duress. When you are stressed and scared, you are not only more susceptible to making poor decisions, but you are also vulnerable to financial predators. Scammers, con-artists, and unscrupulous lenders feed on your fear and can turn a bad situation into a disaster.

It's important to assess your situation and explore all of the possible solutions before deciding on a course of action. Seek sound, objective financial advice. Don't overcorrect and make the situation worse by prematurely borrowing money from your IRA or taking out a second mortgage. There may be less costly options available to you.

And don't be afraid of unconventional solutions. There may be smaller things you can do to keep you from having to make drastic and more costly decisions. Consider things like adjusting your insurance coverage and deductibles, adjusting your tax withholdings, or even selling your car. The important thing is to stop, breathe, and remain open to considering a multitude of possibilities before you act. (See also: How to Protect Yourself From Predatory Lending)

4. Prioritize

Establishing your financial priorities before a disaster occurs is so important. You should always plan to cover your basic needs: food, housing, transportation, etc. If you are unable to afford the basics, look for programs that aid with these things such as a food bank, rent/mortgage assistance, and public transportation. Keeping yourself and your family alive, safe, healthy, and functional must be your top priority.

From there, begin to make a list of the order in which you will pay and skip bills. Yes, you read that correctly. In a time of crisis, some things may have to go unpaid for a time. It's important that you prioritize and pay the things that need to be paid in lieu of randomly paying things as they become due. Opting to pay your store credit cards and cable bill and foregoing the mortgage or rent is a bad idea, but is an easy mistake to make when you don't have a plan. (See also: Pay These 6 Bills First When Money Is Tight)

Lastly, make a list of the order in which you will do things (exhaust the emergency fund, sell the car, get a second job, begin skipping bills, etc.). Having a plan helps ward off panic; it helps you make sound decisions and ensures that you can make the right adjustments as the situation changes. Make sure you run your plan by someone astute in money management who will help you make the best decisions for your circumstances. (See also: 4 Times Raiding Your Retirement Accounts Early Is Okay)

5. Be proactive

The most important thing to do before and during a financial problem is to be proactive. It sounds like basic advice, but being assertive and mustering up the strength to act is difficult during a crisis. Most major events bring with them a grieving process. Trying to be strategic — heck, just trying to function — during a difficult time isn't easy. You've got to acknowledge and accept that the crisis is real and begin damage control as you cope with your grief.

Being proactive early in the process allows you to chart a course of action. You can contact creditors and arrange to pay late or make partial payments and find out what other courses of action are available. You should begin the proactive process by revising your budget to reflect the loss of income or new expenses and stop any unnecessary spending immediately.

After you've prepared your financial ship for battle, start looking for solutions specific to your situation. Make sure you understand your insurance policies, file for unemployment or disability benefits, research treatment options and alternatives, and get a second opinion. It is also a good idea, especially when dealing with tax and/or legal issues, to consult a professional. Arm yourself with as much information as possible before you act and be sure you weigh the benefits of each decision. Remember the key here is to survive the storm and live to fight another day. (See also: What to Expect After These 5 Personal Financial Disasters)

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This article is from Denise Hill of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Could You Make Ends Meet If You Were Suddenly Disabled?

Mikey Rox — Wed, 07 Mar 2018 09:30:09 +0000

Becoming disabled is not a worst-case scenario, but it's one that can wreak irreparable havoc on your finances. You may have little to no control over whether or not a disabling illness or injury will impact your life, but you can prepare for the what-if. If you don't, you could find yourself — and your loved ones — facing financial ruin should the what-if become reality.

We all need to ask ourselves: Could we make ends meet if we were suddenly disabled?

Build your emergency fund ASAP

Ideally, you should have at least six months' worth of salary in an emergency account, but even three months' worth can be a big help when you're facing a disability. Even if you can go back to work eventually, you'll probably be out for some time — first in the hospital, and then recovery time at home, which may be an extended period depending on the severity of your condition. If your emergency fund is currently running on empty, now is the time to focus on beefing it up. Illness or injury could happen at any time, to anyone. (See also: 7 Easy Ways to Build an Emergency Fund From $0)

Identify other sources of income or savings

If you don't have a lot of money in your emergency fund, maybe there are other sources of income or savings that you can rely on. Do you have valuables that you can sell? Can you downsize to put cash in the bank? Will your disability allow you to get a new job based on your skills and limited mobility? Do you have stocks or bonds you can cash in? None of this is ideal, of course, but it may prevent or at least hold off mounting debt while you recover or figure out how to best move forward based on your disability.

Disability insurance is a must

If you're gainfully employed, I highly recommend that you get disability insurance — while you are still healthy and able-bodied — even if it's short-term. Short-term disability insurance will pay roughly half your salary while you're out of work. Short-term disability duration can range, but the maximum amount of time is generally a year.

If you can get long-term disability through your employer, even better; that will protect you after the short-term expires, paying around 50 to 70 percent of your normal salary until you can return to work or for the amount of time stated in your policy.

If you're not sure what kind of disability benefits you may need, talk it over with a financial adviser or planner. You may also be able to get coverage for the eventuality that your spouse has to quit their job to become your caregiver.

Disability insurance may not seem necessary when you're young (I was invincible in my 20s, too), but you could wind up in major financial trouble later in life, especially if you're starting your career with very little money in the bank. (See also: 4 Things You Need to Know About Disability Insurance)

Social Security Disability may be able to help

If you didn't invest in a disability insurance policy before the injury, you can file a claim for Social Security Disability benefits and see if you qualify. Just don't count on it right away. This can be a very long, tedious process, and many claims are denied the first time they are filed. If you are denied, you can file an appeal. A lawyer may be able to help you expedite the process, though it will come with the added expense of legal fees.

Consider your loved ones, too

You don't want to burden your family with taking care of you if you can help it. Preventing them from having to make financial sacrifices on your behalf is another case for investing in disability insurance.

Your loved ones' lives can change drastically along with yours in the event of a disabling illness or injury. They may have to quit a job to become your caretaker, sell or modify their home, or make various other types of serious financial sacrifices. You can lessen that risk with proper planning. Quality of life is even more important when faced with a disability — for all those impacted, not just the injured individual — and it's your responsibility to take care of yourself while you're still healthy and ensure you have a plan.

The reality is, you can't assume that your loved ones will be able to drop everything and make financial sacrifices for you. Illness or injury can be a very stressful situation in anyone's life, and if you can lessen that stress ahead of time, you owe it to those who would be tasked with your care.

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This article is from Mikey Rox of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

7 Times Travel Insurance Is Worth It

Tim Lemke — Tue, 06 Mar 2018 10:00:08 +0000

Traveling is one of the best things you can do for yourself, but it can also be quite costly. This cost can be exacerbated if you end up being forced to cancel or cut your trip short and are unable to get your money back.

Travel insurance can help you avoid losing money if your plans change unexpectedly, or if you encounter an emergency while on your trip. It's not always worth the added expense to purchase travel insurance, but there are a number of instances when it's wise to get it. Consider these when planning your next trip.

1. The trip is expensive

Perhaps you managed to book a pricey, customized, VIP tour of the Antarctic ice shelves, complete with a penguin encounter. Maybe you got an exclusive after-hours tour of the Vatican Museums. You saved up enough money to book these bucket list vacations. It took you a long time, and a lot of hard work. These are trips that you may never be able to book again if you are forced to cancel. Travel insurance is not necessarily going to allow you book that expensive, once-in-a-lifetime experience again, but at least you'll avoid the pain of also losing all the money you spent to book it.

2. You've had recent health issues

One of the most common reasons you may be forced to cancel a trip is an illness or injury that prevents you from traveling. If you are battling cancer, for example, you may feel good one day and not so great the next. It may also be impossible to predict when treatments or surgery may be needed. In this case, travel insurance can give you some peace of mind and allow you to go ahead and book that trip.

Older travelers who may have certain health conditions that have the tendency to flare up may also find travel insurance useful. It is important to note, however, that many travel insurance policies do not cover trip expenses if you cancel due to a pre-existing health condition, so be sure to check the specific provisions of the policy before buying. (See also: What Exactly Does Trip Cancellation Insurance Cover?)

3. There's a chance you may be pregnant

If you and your partner have been trying to have children, you may be wary of vacationing because you don't want to cancel a trip if you do get pregnant. At the same time, it seems silly to avoid traveling if you're not expecting. Travel insurance can come in handy here, because it will allow you to book travel without worrying about losing money if you get some good news. (See also: Everything You Need to Know About Buying Travel Insurance)

4. If you're cutting things close

Let's say you've booked a cruise departing from Barcelona leaving on Saturday, but your schedule only allows you to fly to Barcelona that day. To make things dicier, you have to take two connecting flights to get there. If you experience any delays or miss a flight, you may miss the cruise departure entirely. Travel insurance could reimburse you for costs you incur to catch up with your cruise.

Keep in mind, however, that travel insurance may only cover you if you're delayed due to weather or mechanical problems with the airline. Missing a flight because you overslept, for example, may not be a valid reason to seek reimbursement.

5. If you're going somewhere with unknown medical care

Getting sick or hurt on a trip can be a harrowing experience, and that's especially true if you find yourself in a place where medical care is below American standards. Even today, there are many countries that lack a robust health infrastructure, and medical staff there may not be equipped to perform surgeries or other emergency procedures. A good travel insurance plan can cover travel to better health facilities or hospitals, to ensure you have the best possible medical care even if you are far from home.

6. If you're traveling to a "high-risk" country

Adventurous travelers may find themselves in places that carry some risk to personal safety. Some nations are torn apart by civil war or unrest. Others are prone to incidents of terrorism. Even countries that have general political instability can be risky places to visit.

It's possible to buy travel insurance that covers you for a variety of things if you go to these countries. You can be covered for injuries, for example, or if you have to be evacuated. There are even policies with provisions relating to kidnapping and extortion. (See also: 5 of the Safest Countries to Visit in 2018)

7. If you're in the military

Those serving in our armed forces must be ready to travel anywhere at a moment's notice. If you are on active duty or a reservist, you know that any vacation could be interrupted if duty calls. Travel insurance can reimburse you for costs if you have to cancel or interrupt a trip due to military service.

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This article is from Tim Lemke of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Urgent Care or ER? How to Decide Where to Go

Kat Tretina — Fri, 02 Mar 2018 09:00:07 +0000

A few weeks ago, I was walking with my husband at the park when an enormous, bearlike dog came out of nowhere and barreled into me. Caught by surprise, I got knocked into the dirt. When the shock wore off, I realized my ankle had twisted in a way it wasn't meant to and I had trouble getting to my feet. Within an hour, my ankle had swollen to double its normal size and I couldn't put weight on it.

I was about to head to the emergency room (ER) — and the huge bill that would undoubtedly come with it — when I reviewed my insurance policy to see what my copay would be. In the paperwork, I found out that going to an urgent care facility would be much cheaper. I was thrilled and the urgent care facility I visited helped me get back on my feet (literally).

If you're sick or injured, your first instinct might be to head to the emergency room. However, doing so can come with a large bill. In fact, the average ER bill is a staggering $2,259, according to Cigna. Visiting a local urgent care center, where the average cost is just $176, might make more sense. Here are a few key things to consider before going to the hospital. (See also: How to Handle a Massive Medical Bill)

Seriousness of illness

When deciding where to go, consider just how serious your injury or illness ill. If you're sick or have an infection and your doctor is unavailable, you may think the ER is your best bet. However, some insurance companies don't cover ER visits for non-life-threatening emergencies. That means that if you have something like pink eye and go to the ER, you could end up footing the bill entirely on your own.

If you're not facing a true medical emergency, an urgent care facility is a cheaper and safer option.

Services

Although urgent care facilities are usually cheaper and more convenient than the ER, they have limitations. They tend to have X-ray equipment, EKGs, and lab testing, but lack the facilities needed for more complex illnesses or problems. And, urgent care centers usually just have one or two doctors available and no specialists. Because of these factors, urgent care facilities are best for short-term illnesses or injuries, such as:

Coughs.
Minor injuries or burns.
Fevers.
Stomach pain or vomiting.
Sore throat.

If you have a more severe injury or illness, an urgent care facility might not be able to give you the care you need. Instead, you may need the tests, expertise, and care that only a hospital can provide. You should head to an emergency room (or have someone take you) in the following situations:

Head injuries.
Allergic reactions.
Unconsciousness.
Deep wounds or severe burns.
Chest pain.
Major broken bones.

Availability

If you are hurt or sick outside of your doctor's normal business hours, both urgent care centers and the ER are useful options.

Although urgent care facilities tend to have longer hours than your normal doctor, they are not usually available around the clock. If you are injured late at night or very early in the morning, your only option may be the ER.

Wait times

Most urgent care centers operate on a first-come, first-serve basis. You could wait as little as five minutes to see a doctor or have X-rays done. You'll also get necessary treatments and be on your way home faster than you would seeking treatment at a hospital.

Emergency rooms work differently. They use a triage system, where patients are seen based on the seriousness of their condition. If you have a mild problem, such as a sprained ankle or a sore throat, you could wait several hours so that others can be seen first.

In-network vs. out-of-network

Many doctors working in emergency rooms are independent contractors. That's important to know, because that means they may not operate within your insurance provider's network. Visiting the ER and being cared for by an out-of-network physician can mean a huge bill later on.

If possible, going to an in-network urgent care center will be cheaper than going to the ER. However, if your illness or injury is serious and you need to go to the ER, you can request an in-network doctor when you fill out your admissions forms.

Payment plans

Depending on your condition and whether or not you have insurance coverage, you could be on the hook for a large medical bill regardless of what kind of center you visit. If you are short on cash, where you go can affect what payment options are available to you.

Most urgent care facilities require payment in full before you leave and don't offer payment plans. If you don't have insurance, you could have to pay hundreds or even thousands right away. Without that money in savings, you might have to rely on credit cards to pay it and end up in debt.

Emergency rooms often have more leeway. They may offer payment plans or even have charitable funds set aside to cover the costs of low-income patients. Talking to the billing department about your situation can help you identify all of your options so you can pay for necessary treatments. (See also: What to Do If You're Hit With a Huge Medical Bill)

Managing your medical bills

If you've already been hit with a big bill after medical treatment, don't panic. There are ways you can negotiate your medical bills and qualify for financial assistance or reduce how much you owe.

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This article is from Kat Tretina of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

EpiPens and Other Ways Companies Have Profited From Your Pain

Paul Michael — Thu, 22 Sep 2016 10:00:05 +0000

The EpiPen literally saves lives. So naturally, the makers of the lifesaving product decided to cash in on that, raising the cost from $100 for a package of two, to over $600! (And that's with a coupon, by the way).

The reason behind the dramatic increase is awful. According to Tech Times, five top Mylan NV executives had to hit some pretty incredible sales figures to achieve their combined $82 million in bonuses. Knowing the EpiPen is essential to many people, they simply jacked the price up and hit their goals. But, as you'll soon discover, this isn't the first time companies like Mylan NV have stuck it to people in need of medications.

Daraprim, One Pill — $13.50 to $750

If the drug doesn't sound familiar, the awful person behind its price hike will. His name is Martin Shkreli, often described in news stories and social media outlets as a man with a face you'd love to slap. His company, Turing Pharmaceuticals, acquired Daraprim in 2015 for $55 million. The drug is used to fight AIDS, malaria, and is also an antiparasitic. On September 17th, 2015, it was reported that the price of the drug had spiked from $13.50 per pill to $750 per pill, an increase of 5,456%!

Shkreli defended the massive increase, saying "If there was a company that was selling an Aston Martin at the price of a bicycle, and we buy that company and we ask to charge Toyota prices, I don't think that that should be a crime." It was poetic justice to see Shkreli in court this year.

Cycloserine, 30 Capsules — $500 to $10,800

Used to treat drug-resistant tuberculosis, Cycloserine was already costly at $500 for 30 capsules. So when Rodelis acquired the drug and raised the price in September 2015, overnight, to $10,800 for the same number of pills, there was outrage. In fact, so much was said about it that biotechnology stocks suffered losses, with investors worried about the backlash. Rodelis caved to pressure and gave the drug back to its previous owners, a nonprofit organization affiliated with Purdue University. However, the drug did not go back to its regular price. The cost was doubled from $500 to $1,050 for 30 capsules.

Isuprel, One Vial — $180 to $1,472

A drug used to treat abnormal heart rhythms is, as you can imagine, vital to many people in the U.S. and around the world. Valeant Pharmaceuticals International didn't see that as a good enough reason to keep the drug at its already steep price, and jacked the cost up by 718% in February last year. Valeant were called before Congress to explain their actions, and agreed to set up discounts of as much as 40% on the drug. As of May 11th, many heart hospitals were still waiting for those discounts to appear.

Nitropress, One Vial — $215 to $881

The same company responsible for the Isuprel price hike were also behind the massive cost increase of Nitropress last year, a drug used to keep blood pressure low during heart surgeries. However, it wasn't quite as steep as the Isuprel rise, costing hospitals, and therefore patients, 312% more. The then CEO of Valeant, J. Michael Pearson (who has a net worth of $175 million) issued a statement saying the price increases were mistakes, saying "The company was too aggressive — and I, as its leader, was too aggressive — in pursuing price increases on certain drugs." That probably comes as little comfort to the people who receive their hospital bills.

Vimovo, One Tablet — $1.88 to $23.86

There are over 100 types of arthritis, including osteoarthritis and rheumatoid arthritis. If you are diagnosed with it, you will be suffering from joint pain that can be crippling and debilitating. So, a drug that helps ease this pain should not be just as painful to buy.

Horizon Pharma acquired the rights to the drug Vimovo, which helps to fight arthritis, in 2013. It then hiked the price by 597%, taking one tablet from $1.88 to $23.86. Considering a vast number of people suffering from this condition are in retirement and on a fixed income, this is a disgrace. But the company hiked the price again recently, with a pack of 60 tablets now costing over $2,000 (with a coupon). Ironically, the drug is simply a mixture of two very cheap drugs, esomeprazole and naproxen. Many doctors are encouraged (that means kickbacks) by big pharma companies to write "prescriptions made easy" for these combination drugs. Always ask your doctor if there is a cheaper alternative that works just as well.

Dutoprol, One Pill — $0.52 to $5.26

This drug is used to treat high blood pressure, and up until 2013, the price was fairly reasonable — around $15 for a bottle of 30 pills. Clearly, the company the manufactures Dutoprol, Covis Pharma, was not happy with a reasonable price. So, they hiked the price by 1,013% to $5.26 per pill, or $157.80 for a bottle of 30 pills.

Sprix Nasal Spray, One Bottle — $32.07 to $183.97

If you have severe nasal pain, you will require a good pain reliever. Sprix is the only nonsteroidal Anti-Inflammatory Drug (NSAID) on the market, and is preferred by people who do not want to use opioids or controlled substances. That preference will now cost a lot more. In February of 2015, Egalet Corp raised the price of one bottle from $32.07 to $183.97, an increase of 574%. And as the spray is often sold in packs of five, you will be paying over $900 for that much-needed pain relief.

Tasmar, One Tablet — $15.70 to $105.98

Perhaps the most famous person you'll know of that may need Tasmar is Michael J. Fox. It's a drug used to treat the effects of Parkinson's disease. And once again, Valeant Pharmaceuticals is behind the massive price hike. In April last year, the company decided to raise the price of one tablet from $15.70 to $105.98, an increase of 675%. While a movie star may not have issues paying that bill, most people will get serious sticker shock when they have to pay over $6,300 for their bottle of 60 tablets.

Edecrin, One Vial — $470 to $4,600

Used in the treatment of edema and heart failure, Edecrin is a diuretic that helps your body get rid of excess salt and water. When Valeant acquired the rights to this drug, it started raising prices. Not once. Not twice. Not three times. The price has been increased an astonishing nine times since 2014, and is now $4,600 per vial.

Targretin Gel, One Tube — $1,687 to $30,320

Those are not typos. You did read that correctly. There is clearly something going wrong somewhere when a company can charge more than the price of a Dodge Charger for a tube of topical gel. And, of course, it's used to address the symptoms of a form of cancer, which is one of the most expensive diseases to treat. Once again, those wonderful people at Valeant are behind the rise, and at over $1,600 a tube to begin with, it was hardly in desperate need of a price hike. But, they did it, making the small tube of gel 18 times more expensive after they bought the rights to the drug in 2013.

Valeant has defended the rise, saying full retail prices "rarely represent the prices that patients and insurers are paying or what the pharmaceutical company receives." If you don't have good insurance, or any insurance, you likely won't have the money needed for this drug. Incidentally, at the same time, Valeant raised the price of Carac cream, another topical treatment dealing with skin cancer, from $159 to $2,705. The message this company is sending is clear…you get sick, we get rich.

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This article is from Paul Michael of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

4 Things You Need to Know About Disability Insurance

Matt Bell — Tue, 02 Aug 2016 10:30:12 +0000

Insurance. There are probably no other financial terms more likely to induce feelings of sleepiness. Or dread. After all, who likes to spend money on something you hope you'll never have to use? And don't you have enough types of insurance already?

Well, without wanting to sound like an insurance salesperson, how would you pay your bills if an accident or illness left you unable to work? That's the risk disability insurance is designed to cover. It would pay a portion of your salary in that situation.

The good news is you may already have adequate protection. And even if you don't, the cost of coverage may not be as high as you feared. Here's what you need to know about disability insurance.

1. You Might Need It

When you're young and healthy, it's difficult to imagine life might ever be different.

However, the insurance industry is quick to point out that your chances of becoming disabled are higher than your chances of dying prematurely. And the Social Security Administration has a scary-sounding statistic to back that up: Some 25% of 20-year-olds will become disabled before reaching retirement age.

However, not all disabilities are the same. Some are severe and permanent. About 10% of all Americans are now severely disabled, according to the U.S. Census Bureau. Many other disabilities are neither severe nor long-lasting. To put the situation in context, the Council of Disability Awareness says the average length of a long-term disability claim is three years.

So, when considering your need for disability insurance, it's important not to be scared into overpaying for protection.

2. You Might Already Have Some

Even without buying a disability insurance policy, you might already be at least partly covered.

Workers' Compensation

This program is administered on a state-by-state basis, and some states do not require companies with fewer than four employees to maintain the coverage. However, if you work for a company that does carry workers' "comp" and you're injured on the job or develop a work-related disabling illness, this insurance should cover about two-thirds of your pre-disability income.

Still, the National Safety Council points out that only 27% of long-term disabilities are work-related. Most don't even come from accidents; they come from cancer, heart disease, and other illnesses.

Social Security

If you've been contributing to Social Security long enough, you may qualify for disability benefits. To find out, go to ssa.gov and click on "sign in/up." However, even if you're eligible for Social Security disability benefits, that doesn't mean you'll qualify. Your disability has to be severe enough to keep you from working for at least a year (or be expected to), and it has to prevent you from doing the work you used to do or keep you from "adjusting to other work." In other words, the program is designed to protect only the most severely disabled.

Self-Insurance

If you experience a short-term disability, you may be able to cover your expenses with personal savings. For example, an emergency fund savings account containing six months' worth of essential living expenses could be viewed as a short-term disability policy.

You may be able to tap retirement funds, as well. For example, if you have a workplace plan, such as a 401K, you may be able to take out a low-interest loan. Or, if you have a Roth IRA, you can withdraw your contributions at any time for any reason without penalty.

3. You Might Need More

After reviewing all of the above, if you decide to buy additional coverage, check whether it's offered through your employer. That will typically be the least expensive option.

If it isn't offered, get some quotes from an online broker, such as PolicyGenius, Disability Insurance Resource Center, or DisabilityQuotes.com.

4. You Can Control the Cost

Key variables that will influence the price of a policy include:

The waiting period. This is the amount of time between the onset of a disability and when the policy will begin paying. The longer the waiting period, the less the policy will cost.
The benefits period. This is how long the policy will pay benefits. You could opt for a policy that pays through age 67, but remember, the average long-term claim is three years, and choosing a shorter benefits period will lower the cost of the policy.
The benefit amount. You may qualify to cover 60% of your salary, but choosing a lesser amount will lower your cost.
The definition of "disability." Ideally, you'll want a policy that protects you in case you are no longer able to perform the duties of your current occupation (an "own occupation" policy). You could buy a less expensive policy, though, if you're willing to accept one that pays only if you are not able to do other types of work.
Add-ons. You'll be offered numerous policy "riders." Among those that may make the most sense is inflation protection, which would provide a cost-of-living increase in the benefit amount each year.

Your ability to earn income is one of your most valuable assets. So, if you're not covered by a workplace disability insurance policy, take a few minutes to think about how you would pay your bills if you were suddenly unable to work. And keep in mind that you don't need to buy the most deluxe policy available. Protecting some of your income would be better than protecting none of it.

Do you have disability insurance?

This article is from Matt Bell of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

What Is Power of Attorney?

Dan Rafter — Mon, 20 Jun 2016 09:30:26 +0000

Struggling with money issues or big medical decisions can happen to all of us. Aging, illness, or other factors can contribute to the difficulty. You can get help, though, through a legal document known as a power of attorney.

In a power of attorney, you sign a document stating that another person whom you trust, known as the agent or attorney-in-fact, has the power to act on your behalf to make certain decisions. Your power of attorney could limit this person to making only financial decisions on your behalf. But you can make the document broader, giving your agent the power to make a wide variety of decisions, including choices about medical care, or decisions regarding where you live, and when it's time to sell your home.

When You Need One

In most cases, it is elderly people in their retirement years who choose to enact a power of attorney. This is especially true for elderly people who are struggling with memory issues or other illnesses that make it more difficult for them to keep track of their finances.

You might not think you need a power of attorney if you are married. After all, even if you can no longer handle the tasks of paying your bills on time, your spouse can withdraw funds from your joint bank accounts to make sure that your mortgage company, auto-financing company, or utility company are paid on time each month.

But there are other financial decisions that can be complicated even for married couples. For instance, it might make sense to sell your home. But in many states, both spouses must agree to a home sale. If one spouse is incapacitated and unable to make this decision, the other spouse might not be able to put the home on the market.

Also, your spouse will have no legal authority to make decisions regarding accounts or property owned solely by you. A power of attorney, though, can guarantee that important financial or property matters are handled by someone whom you trust.

Different Types of Contracts

There are several different types of power of authority contracts. What is known as a durable power of attorney might be the most powerful. This type of power of attorney remains in effect for your entire lifetime. This gives the agent free reign to manage your accounts on your behalf for as long as you are alive.

Because a durable power of attorney lasts the rest of your life, though, you need to be clear about what you want it to say. If you want your agent, for instance, to only be able to make decisions regarding your home and its sale, spell that out in the power of attorney document. If you want your agent to have broader control over both your finances and your medical decisions, spell that out, too.

A conventional power of attorney goes into effect when the document is signed and ends when that person becomes incapacitated.

You can also create a springing power of attorney. This type goes into effect when a specific event takes place. In most cases, a springing power of attorney will become effective when you become mentally unfit to handle financial, medical, or property decisions.

The challenge often lies in determining when this specific event has actually taken place.

Be Wary

Creating a power of attorney is a big decision, and one that you should only make after meeting with loved ones and legal professionals. Remember, you are signing over your right to make your own financial, property, or medical decisions.

Keep in mind your spouse, too. Your spouse can continue to make decisions on your behalf even after you have signed a power of attorney. But once your spouse becomes incapacitated, the agent you named in your power of attorney will take over.

Deciding who will serve as your agent is the big decision here. You can choose a family member, your spouse, a friend, or another loved one. The key is to find someone you both trust and who is willing and able to take on this responsibility.

Have you considered granting power of attorney? Has someone given you this responsibility?

This article is from Dan Rafter of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

7 All Natural Home Remedies for Colds

Ashley Marcin — Fri, 30 Jan 2015 16:00:14 +0000

My husband is a high school English teacher. My daughter is in her first year of preschool. Sickness is a way of life for us with so much exposure to germs. In fact, we just got over a full month of passing around two nasty cold viruses. (See also: 12 Natural Remedies for Stomach Pain)

Here are some helpful cold remedies that won't send you running to the store, as you likely have most of the ingredients sitting around in your kitchen cabinets. The best part? They're all drug-free!

1. Miso Broth

From upset stomach to coughs and colds, this delicious miso soup doubles as a cure and healthy meal option. Miso is made from fermented soy and rice, and it's full of good-for-you living enzymes, vitamins, minerals, and amino acids. My husband skips the veggies and simply warms a few cups of water on the stove. He then dissolves a tablespoon or two of miso in it and sips all day long.

2. Veggie Broth

You don't need to go out and buy miso if you don't have it already. Instead, try this healing veggie broth that combines the goodness of garlic, ginger, lemon, cloves, and cayenne pepper. And water for hydration, of course. Simmer on the stove and strain before drinking. The cayenne pepper acts like an expectorant and helps get all the gunk out of your system.

3. Garlic Snack

I love how garlic tastes minced in olive oil. But did you know garlic is a powerful antioxidant with antimicrobial, antiviral, and antibiotic properties? In other words, it's great for fighting cold and flu viruses. You can munch on a whole clove to get the benefits. For those of you with sensitive stomachs, try mincing garlic and letting sit with some olive oil and honey before eating on a cracker.

4. Vapor Rub

Or try mixing together some DIY vapor balm — much like the popular ones on the market — using olive oil, beeswax, and essential oils (peppermint and eucalyptus). This balm is wonderful for easing chest congestion and discomfort. The benefit here is knowing exactly what you're rubbing into yourself. You can also make different strengths to suit all your family members by adding more or less essential oils.

5. Salt Gargle

Most of us know about the mighty salt gargle to relieve scratchy, sore throats and wash away germs. But are you doing it correctly? Combine ½ to ¾ teaspoon salt with one warmed cup of pure water. Chlorinated tap water will irritate your throat, so skip that in favor of something filtered. Or you can dechlorinate water by leaving it out in the open for 24 hours.

6. Apple Cider Vinegar Drink

My family has long used unfiltered apple cider vinegar as a cold cure. It's pretty darned effective at thinning mucus and clearing out sinuses. Dilute two to four tablespoons of ACV into one cup of warm filtered water (same reason to avoid tap water, as explained above) and add raw honey for taste if you like. Drink up four to six times a day to help kill bacteria and soothe your sore throat. (See also: 12 Awesome Ways to Use Apple Cider Vinegar)

7. Honey Coat

Honey is an effective, natural cough suppressant. So, skip the pricey cough drops and syrups and use this mixture of honey and lemon instead. Combine a half cup of honey with half a lemon, two cups of water, and some fresh or dried thyme leaves. Store this homemade syrup in your refrigerator for around a month.

What are your flu season go-to home remedies? Please share a dose in comments!

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This article is from Ashley Marcin of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

This Is What It Really Costs to Get Sick

Emily Guy Birken — Wed, 07 May 2014 15:29:51 +0000

It's very difficult for many of us to think about the possibility of getting sick. When you're healthy, it doesn't seem like you'll ever have to worry about illness. And after all, isn't that what health insurance is for?

But falling ill is not just costly to your insurer. Your poor health can not only affect your finances, but also those of the medical industry, your employer, and the economy as a whole. Here's what you need to know about how costly it is to be sick.

Personal Costs

Your personal costs due to poor health are fairly obvious — the amount you spend on co-pays, pharmaceuticals, outpatient care, and the like. If you are underinsured or uninsured, you may have to pay these costs entirely out of pocket.

A 2009 study reported that medical debt is a contributing cause in 62% of personal bankruptcy filings. And despite the political promises, the Affordable Care Act will not make these sorts of medical debt obsolete. According to the Brookings Institution:

Some insurance policies may recommend a hospital, but not all the doctors in that hospital may participate in the insurance network. So you can get in the weird situation where you go to an in-network hospital for a complex medical problem, but the specialists (like pathologists) who treat you but don't participate in the network. Bam! — You're stuck with their huge bills with no help from your insurer since the doctors are 'out of network.' (This is the case for many current insurance policies as well and is not a direct consequence of Obamacare.) Worst of all, Obamacare imposes no limit on charges from out-of-network doctors, so you could still lose your house.

That's why it may seem safer to just not get sick and not go to the doctor. But of course, that won't solve anything — and avoiding the doctor can make things worse. According to the National Coalition on Healthcare:

The United States spends almost $100 billion per year to provide health services to people who are uninsured. Much of that money is spent because uninsured patients wait until the 11th hour to seek care, when they could have been treated much more effectively and for less cost at an earlier stage of their medical problem.

Even if you do have health insurance, you may avoid the doctor because you cannot afford the copay. But skipping doctors' visits is simply kicking the problem down the road, and it ends up costing more people than just the individual who can't afford care.

Costs to the Medical Industry

If you've ever wondered why any John or Jane Doe will be admitted to the emergency room, no matter what their insurance coverage or ability to pay, you can thank a 1986 mandate called the Emergency Medical Treatment and Active Labor Act (EMTALA).

The thinking behind EMTALA is certainly noble. It requires that hospitals provide emergency care to anyone who needs it, no matter their citizenship, legal status, or ability to pay. And we would all hate to live in a society that would allow someone to die simply because they have no ID or insurance card on them.

The problem with this policy is that Congress did not specify where the compensation for the care would come from. Hospitals have no choice but to go after the uninsured (and underinsured) patients — which means that hospitals lose about $34 billion per year in unpaid bills.

And of course, anyone who has been to an emergency room in the last few years has seen the other problem that occurs when emergency care is the only place the uninsured know they will see a doctor: Many people are coming to the ER for non-emergencies. This crowds emergency rooms, making it that much harder to diagnose and treat each patient. In addition, ER care for non-emergency issues adds to the costs of medical care.

Productivity Costs

It's likely that you receive your health insurance through your employer. For that reason, your employer has a stake in keeping you healthy. After all, it costs the company money when you get sick — whether you're simply taking a day or two off work to recover from that stomach bug, or you need several weeks off to recover from a major illness.

But there's more to the cost of your poor health than just medical costs. Your lost productivity costs your employer big time: Poor health costs U.S. employers $576 billion annually. Those costs include wage replacement, including sick pay, workers' comp, and short- and long-term disability; medical and pharmaceutical costs; and lost productivity.

Loss of productivity is maddeningly difficult for employers to define, which means that they will often only count medical and pharmaceutical costs when determining how much they spend on poor health. However, according to a study published in the Journal of Occupational and Environmental Medicine, for every $1 that an employer spends on medical and pharmaceutical costs for an employee, there is an additional $2.30 of health-related productivity costs on average. (For some conditions, the additional productivity cost is much greater.)

This is one of the reasons why it can be so difficult for employers — who are the largest group of health insurance providers in America — to determine the best way to improve the health of their employees. If employers are focused on the health conditions that cost the most in terms of medical and drug costs (e.g. cancer, heart disease, and high cholesterol), they miss out on the conditions that are truly driving their company's health costs — conditions like depression, obesity, arthritis, back/neck pain, and anxiety.

Keeping Yourself and Your Finances Healthy

While it is clear that the health care system as a whole needs some major changes, the good news is that individuals can work to improve the cost of health care for themselves. Whether you have decent insurance coverage or not, you can invest in your own physical health by exercising, quitting unhealthy habits, getting regular checkups, and eating well. Not only will you see the benefits of improved health, but so will your community, your employer, and potentially American economy.

Have you suffered extra costs do to illness? How did you manage your budget? Please share your experience in comments!

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This article is from Emily Guy Birken of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread:

Are we too clean for our own good?

Andrea Karim — Mon, 17 Nov 2008 22:27:20 +0000

A friend of mine has three daughters, all under 6 years old. Recently, she was at the supermarket with her youngest. Her daughter dropped her pacifier on the ground. My friend picked it up, wiped it on her shirt, and handed it back to her daughter.

An elderly gentleman approached her a few seconds later. Chuckling, he patted her child on the head. "This must not be your first kid, then," he said with a grin,

"Why do you say that?," my friend asked nervously.

"Well, with the first child, if they drop their binkie, you'd be more likely to boil it before letting your baby touch it again. By the time you get to your second, you get over it."

My friend smiled. "Yeah, that pretty much sums it up."

There are probably a few of you reading this who think my friend is a horrible mother. I can assure you that she is not. Yes, supermarket floors are dirty. Yes, her daughter was probably exposed to germs. But according to many scientists, germs may be exactly what we need more of.

Building up a healthy immune system is one of the most important things that we can do for our health. It's the reason that people try to make sure that their children get chicken pox at a young age; they hope to inoculate their babies against the disease, which is much more serious if experienced at an advanced age. Taking your kid to a Pox Party is like a cheap vaccination. Viruses are serious things, and we believe in inoculating our kids against them, for the most part.

However, we don't feel the same way about bacteria and other bugs. In fact, we do our utmost to avoid contact with bacteria, and when we do experience it, we zap the hell out of it with antibiotics and antibacterial ointments. The result? Our bodies don't know how to deal with bacterial infections, and the bacteria that we do come into contact with is getting stronger and stronger as we continually do our damndest to kill it off. Not only that, but when an immune system with too much free time on its hands comes into contact with innocuous but foreign substances (like cat dander), it over reacts, causing us to suffer from allergies.

You've probably heard that certain conditions that seem endemic to Americans, such as hayfever, asthma, and food allergies, are not as common in the developing world. People infected with hookworm, for instance, have fewer asthma attacks and allergies (the hookworms trigger and immune system response, it is thought, that causes the body to concentrate on the worms, rather than triggering wheezing asthma attacks). By the way, do not Google "hookworm" unless you want to spend the rest of the day fighting the heebie jeebies.

The point is, exposure to other germs, especially those found in soil, are beneficial in preventing all kinds of autoimmune diseases. With that in mind, consider letting go of your germ phobic ways. You'll save some money on the plethora of cleaning supplies that promise to nuke every single bacterium within a hundred-mile radius, and just may find that your kids grow up healthier.

There's certainly nothing wrong with washing your hands, but skip the anti-bacterial soaps. Also, hand sanitizer is good in a bind, but if you apply it several times a day (and don't work in a hospital), you might have bigger issues than germs.
Nobody wants salmonella poisoning, but using the appropriate tools when preparing raw chicken (plastic or glass cutting boards that can be run through the dish washer) and cleaning the kitchen with normal soap and water afterwards can do the trick - no need to break out the Clorox wipes.
Slate.com believes that Americans should eat sh*t and NOT die. Provocative, but also, ew. They also mention the importance of breast feeding as a method for transferring antibodies from mother to child, even though most mothers today also lack crucial antibodies, having also been raised in sterile environments.
Let your kids get dirty. They will survive. I suppose it's possible, but it's fairly uncommon to hear of children who have been hospitalized because they accidentally ingested a little dirt.
Ladies, your ladybits are self-cleaning, like an expensive oven! Unless it has been recommended by your gynecologist, do not feel the need to rinse them out from the inside (click here to see a really odd add for Lysol ladybit cleaner). Remember, douchebag is a better insult than it is an invention. Too much rinsing will actually CAUSE infections.

This article is from Andrea Karim of Wise Bread, an award-winning personal finance and credit card comparison website. Read more great articles from Wise Bread: