Medical Bill
Medical Expenses A Common Cause Of Bankruptcy
When Americans think of a person trapped in enormous amounts of debt, inevitably they think of irresponsibility. They think of fast cars and fancy stereo equipment. They think of people living the high life who could not afford it. In short, they think of a deadbeat. If statistics are any real measure, this impression could merit a change – and a touch of sympathy.
Far from financial irresponsibility, medical expenses are among the most frequent causes of families falling into debt and eventually filing for bankruptcy. The precise percentage of medical bankruptcies is in dispute. However, it is generally acknowledged to be a significant number.
Estimates for the number of “medical bankruptcies” have a wide range. A Northwestern University researcher has placed the figure at 17 percent of all bankruptcies. A group of Harvard researchers have recently increased their estimate to more than 50 percent. According to a Federal Reserve report, households with high medical debt are 28 times as likely to file for bankruptcy as other households. Most recently, an August report from the UCLA Center for Health Policy Research estimated that one in seven Californians carries some form of medical debt. With the nation gripped in a discussion about public financing of medical care, the number of medical bankruptcies has become a topic of note.
Medical bankruptcy can arise in several ways. The most common and obvious is the medical bill charged to the ill patient. When the patient personally suffers a chronic disease, deals with a condition that requires expensive treatment, or must pay for pricey medication, then it can be easy to run up thousands of dollars in costs. Insurance can help, but sometimes is not enough. However, there are other ways that medical expenses can drive a person or family into debt.
Many times the medical benefit is not for medical procedures performed on the person himself. They stem from helping to finance the medical care of a loved one. Sometimes this means caring for an elderly father or mother. Sometimes, tragically, this means caring for a sick child.
Also, some researchers describe “hidden costs” of medical bankruptcy. Often, these expenses consist of medical expenses placed on credit cards or paid on credit in some other way. This is an unwise thing to do. Once the expenses are placed onto the credit card, they become a target for interest and fees.
While medical expenses drive many people to bankruptcy, that is not the only option for handling overwhelming medical debt. Other options exist that can help a debtor take care of their debt before reaching that point. Among these methods are credit counseling, debt consolidation, and debt settlement. Each method can help debtors resolve debt and rebuild their financial health.
“Medical expenses are a common reason that people come to us,” said Heath Tudor, community liaison for Resqdebt, a debt settlement provider in Allen, Texas. “The unfortunate thing is that it randomly strikes good people. The fortunate thing is that it gives us the opportunity to help good people.”
Post by Frugal Dad
Getting Out Of Debt Rewards Plan
Last week on Twitter I mentioned that one of the toughest things about a debt snowball plan is sustaining momentum as you move through each of the debts. Early on, victories come quickly with smaller debts geting paid off on nearly a monthly basis, or so it was in our case. But later on you find yourself staring up at those last two or three piles of debt and realizing it is going to take months, or even years, to follow through on your financial goals. That’s when it is time to schedule some rewards for your hard work.
With the summer half over, and no vacation plans on the horizon, we have decided to schedule a long weekend in the near future for a short trip somewhere close. It’s a reward to ourselves for hitting a major milestone in our debt repayment plan - we are now completely free of car debt for the first time in our 11-year marriage!
Ideas for Setting Up a Getting Out of Debt Rewards Plan
- Share the rewards with your friends and family. Get everyone fired up about getting out of debt. For those with kids it often helps to let them know about the goals, even if you substitute dates for dollar amounts (i.e. we would like to pay off our car by September, rather than we need to pay off $9,000 in car debt). Besides getting them excited about getting out of debt, it also helps soften the blow each time you say “no” to their request for a new toy. They know the whole family is on a plan to get to debt freedom!
- The reward should be in proportion to the level of sacrifice to achieve the related milestone. In other words, don’t schedule a cruise to celebrate paying off a $300 medical bill. But do schedule one (if that interests you) to celebrate paying off your $40,000 in student loans!
- Put together a sinking fund for your “Rewards Account.” The last thing you want to do is celebrate paying off debt by charging a trip for the family to Six Flags. Instead, create a sinking fund in a dedicated checking or online savings account, and move some money out of each paycheck there to fund a “Rewards Account.” When you hit your debt milestone, withdraw your cash and enjoy!
- After celebrating, get right back to work paying off remaining debts. Now is not the time to grow complacent. As soon as your vacation is over, or you’ve spent some time enjoying your new purchase, get right back into your debt snowball plan and work towards that next milestone.
Getting out of debt is as much about being disciplined emotionally as financially. If you become burned out with your debt repayment plan long before you pay off 50% of your debt, chances are you will never make it to debt freedom. Planning a few rewards along the way will help keep you and your family on track.
In case you are wondering, our next milestone to celebrate is when we’ve paid off all but our final credit card. The reward? A new living room sofa. When we are totally debt free? We’re finally going to Disney World!
Post from: Frugal Dad
14 Quick Ways To Raise Cash
In the days before emergency funds are fully established there will come a time when you need to generate some quick cash. In a worst case scenario you may need the cash to pay a utility bill, a medical bill, or even your mortgage. In a real emergency, every little bit of cash helps, and here are several ways to raise cash quickly.
1. Take a “day laborer” job. Check out the classifieds for listings looking for day laborers. Often times contractors are looking for people to do some type of manual labor for a short duration, even as short as one day. It could be cleaning up a job site on a new build, or tossing bricks up to guys on a scaffold. You’ll probably earn minimum wage, or only slightly better, but for a couple days work you could clear $100.
2. Sell Your DVD Collection on Ebay. Seriously, how many of those DVDs do you really watch repeatedly? I can count on one hand the ones I would want to keep, but the rest could be sold and I’d never miss them.
3. Work surveys at CashCrate. I’ve been a member of CashCrate for nearly two years now, and still work surveys for extra grocery money. It may take a while to get to $100, but hitting the minimum payout can easily be done the first day. Talk up CashCrate to your friends and family and have them sign up under your name, as the real earning opportunity is in the referrals.
4. Ask neighbors if you can mow their lawn. Even if you don’t consider yourself a “landscaper,” you could easily mow, edge and blow a couple yards for your neighbors on a Saturday morning and make $100. You’d be surprised how many people will take you up on the offer just to take a week off from yard work!
5. Hold a yard sale. One of the faster ways to raise cash is to hold a yard sale. You don’t have to spend a lot of money on advertising. Simply buy a few pieces of brightly-colored poster board and a fat magic marker. Write “YARD SALE” in bold letters, followed by the times and your street address. Place the signs at major intersections to draw traffic. For other ideas read more tips for a successful yard sale.
6. Sell gold jewelry. Thanks to the recession gold prices are still running high. If you have some gold jewelry sitting around that you rarely wear, it might be worth offering it up to broker who will give you a little cash in exchange for allowing him to melt it down and resell it for a profit.
7. Be a medical guinea pig. Medical research facilities and universities will pay participants to take part in trials, surveys, and other types of research. Tread carefully here; some trials could have negative medical consequences, while things like surveys and sleep studies don’t seem so bad.
8. Donate plasma. Most cities of any size have a donation center that will offer $25-$35 for a donating plasma. And depending on your medical condition you may be able to donate up to twice a week.
9. Redeem your credit card rewards. Even if you are like me and you haven’t used credit cards in a while, but are working to pay them off, chances are there are some rewards points accumulated from past spending. Contact each credit card company and ask about your rewards balance. Redeem what is available in the form of cash (check from company), or a gift card to a store you can buy some household essentials (Walmart, Home Depot, etc.).
10. Sell your books online. Services like Cash4Books.com will provide an online quote for your books and even add a little extra for the trouble of shipping. Books that don’t sell here may sell at sites like Amazon.com marketplace (a great place to sell textbooks) or eBay.
11. Take something valuable to a pawn shop. Musical instruments, computer equipment, jewelry and sporting equipment in good condition all sell well at pawn shops, and owners are more likely to give you cash for these items.
12. Sell company stock. If you currently participate in an employee stock purchase plan at work, consider cashing out if you are in need of cash. Company stock is not well-diversified, and often the cash could be put to better use, even if it is simply reinvested with a broader diversification.
13. Ask to work overtime. With unemployment running high, and little budgeted for new hires, you may be able to work a little overtime if demand justifies it. Talk to your boss about working some extra hours and you should have a little extra in your next paycheck.
14. Gather up loose change. If you are like me you probably have a couple stashes of loose change - on top of your dresser, in the cup holder of your car, and the cracks between sofa cushions. You can either roll the coins in wrappers provided by your bank, or visit a Coinstar machine in your area to convert the coins to cash. Coinstar charges a fee for cash payouts, but you can get an Amazon.com gift certificate for your full balance, which could be used to buy just about everything under the sun.
Post from: Frugal Dad
