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Health Scare and Some Financial Questions?

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Yesterday, in a post on Lazy Man and Health, I introduced you to the Travelin' Man. You might be familiar with him because he comments fairly frequently. Unfortunately, his doctor says that he might have bladder cancer. He sent a few bloggers an e-mail, asking a few financial questions. I'll take a shot of answering them here...

Each bullet point is a question from him, and my responses are directly below that:

  • Should I alter contributions to my 403b? I get a match of 100% up to 5% of salary. I currently contribute 10%.
    LM: I'd suggest dropping that down to 5% to pick up the match.
  • Should I divert more of my paycheck earmarked for investment into a high-yield savings account, at least for the short-term?
    LM: I think that's a smart idea.
  • Of the money I already have invested, do I need to consider re-allocating my assets to a less risky portfolio (Hey, I am young - it is almost all stocks - and weighted heavily to international ~35% or so)?
    LM: I might add a few bonds to the portfolio, maybe make it around 20%. If it were me I'd still keep about 35% of the remaining 80% in international funds. I think there's more risk in relying on the US with a vast majority of your money.
  • I don't have a will or living directive written. Is there a process that I need to follow?
    LM: I'd look to create a living will online. It looks like it could be free. Read the commments, there are probably a couple of other things in there as well.
  • I am single with no dependents - how would that alter your way of thinking versus being married with a few kids to take care of?
    LM: Well if I was married with children, I would definitely be looking at my life insurance to make sure that they'll be cared for. Unfortunatly, this might not be an option with a health scare. In some ways you are better off - not having to worry about their survival if you are unable to provide for them. In other ways you are worse off, not having their support at a time like this.
  • My employer is very generous with paid leave, and I have about 400 hours of sick time accrued. How important is it to manage that time versus looking at things like short-term disability (pays about 2/3), or is that even an option?
    LM: I think the doctors and/or treatment will dictate this one. If you are phsyically able to work in the short term, then I'd do that. When you are not able to work try to determine if it's just going to be for one day or if it's going to be a couple of weeks. Your doctor should be able to help you.
  • Given the likelihood of remission, but possibly having to deal with this again in the future, how would you alter choosing health insurance packages? Would something like AFLAC be beneficial during the next sign-up period?
    LM: This answer depends almost entirely on the health packages offered to you. There are a ton of online articles comparing HMOs and PPOs and do either any justice in this space would be impossible.
  • At 35 years old, is it too early to start thinking about long-term care insurance (again, single with no dependents)?
    LM: I don't think it's ever too early to "think about" anything. Definitely educate yourself and run the numbers. I'm almost thinking that it's a good idea, but I don't know if long-term care insurance rise with your current condition - like life insurance. If it does rise and it rises too much, then it's not valuable. It's going to be something that you have to take on a case-by-case basis.
  • While my credit is not stellar, I have made great strides to improve it (the only outstanding debt I have right now is my mortgage and student loans - the total of which is about $45k). Are there any "best ways" to handle in the impending medical expenses?
    LM: I'm going to assume your health insurance willl help you know what is and what isn't covered. That's going the first obvious start. The other idea I had was look to see if your employer offers some kind of health savings plan where you save money for health expenses tax-free.
  • Are there any other spending or saving habits that you would adjust?
    LM: Honestly, I would probably start to save a little less for the long term and try to pack in some fun now. Sometimes something like this will give you the kick in the pants to do something you've always wanted to do.

Obviously health comes first, but what you suggest to the Travelin' Man?

Posted on June 28, 2007.

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3 Responses to “Health Scare and Some Financial Questions?”

  1. Jon Smock says:

    Not sure if it’s been said yet, but don’t do anything drastic just yet. Wait at least a week or so before you change all your assets around and sign up for this or that. Take things slow, make sure your priorities are where they should be, and always remain cautious without being defeatist in attitude.

    I like Lazy Man’s advice to do something you have been waiting to do. A little relaxation or something to recharge your emotional batteries wouldn’t hurt after news like that even in the case that it’s nothing at all. Money isn’t good for anything unless you use it at some point, so splurge a little perhaps.

    I also agree that putting some of your savings into more reliable short-term investments is a decent idea. Again, this probably shouldn’t be a feast or famine situation until you’ve got more information, but gradually moving money to safer investments is always a good idea if there’s a chance some bigger bills might be coming your way in terms of doctor visits or tests.

    Best of luck – I’ll pray for you.

  2. Brip Blap says:

    Your mental health is critical, I think. Don’t worry about saving so much right now. Don’t go out and blow the savings account on a plasma screen. At the same time, I don’t think that finances should be your first thought at this time. Get everything set up for automation – bills, savings, etc. – then forget about it and spend time taking a walk in the park, spending time with friends, enjoying a movie. And if you feel a need to buy a new book to take your mind off your problems, do it. Keep your money in HSBC or ING so it’s available but not there for impulse spending, and forget about it for a while.

  3. HMG says:

    I kind of agree with Brip Blap. While being conscious of your finances is important, he should really try to assess your financial situation and any changes in savings plans after any medical treatment.

    A few years ago I had to take about 6 months off work and spent the majority of that time just focusing on getting better. Only once I was back at work and fully recovered did I start thinking about savings plans and making sure I had adequate health cover going forward.

    I would recommend that he take this time to educate himself about his diagnosis (which it sounds like he did). You would be surprised at how quickly your knowledge will meet or surpass that of doctors since they need to understand and research thousands of problems yet you’ll only be researching one disease. Oh, and he should probably get a second opinion if you haven’t already – I did (although unfortunately in my case the diagnosis was no different)!

    Would also recommend that he read Lance Armstrong’s books – pretty inspirational for someone who is diagnosed with cancer.

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