How to Manage Medical Expenses after Retirement

Posted on: Aug 29, 2022 | | Written by:

How to Manage Medical Expenses after Retirement

Are you about to become a senior citizen and dealing with a mixed bag of emotions? Most probably, you are excited about relaxing or travelling or taking it easy, but anxious about money matters at the same time. Especially, since age-related health problems can eat into your savings significantly, you might be worried about dealing with rising healthcare costs. But don’t fret. In this blog, we will take you through some effective tips for managing money better to handle such situations and tell you why you need a comprehensive senior citizen health insurance plan.

• Learn to Manage Your Money Wisely

Senior years are not the best time to play fast and loose with your money as income sources dwindle or become non-existent. You need to practise strict financial discipline. Draw up a budget and compare your sources of income and expenses. If you have a debt, pay it off quickly and avoid taking any more debt. List all your expenses related to food, housing, essentials and occasional treats. Next, check your compulsory, recurring expenses, like the premiums for senior citizen health insurance, life insurance, vehicle insurance etc. Once you total them, divide by 11. Now, put this amount on your monthly budget. The 12th is accounting for price hike in any of these. And based on whatever money is coming in, you need to continue with a savings plan. So, list your savings next and make sure you always save some money every month. While your health insurance plan will cover you in case you are hospitalised, you should have enough to deal with small medical bills or check-ups.

• Focus on an Emergency Fund

When you are a senior citizen, it is very important for you to have an emergency fund. You never know when and what kind of emergency you may come across. Your pension might not be enough, and you will need to pay for everyday things too, like groceries. So, start contributing to an emergency fund to meet healthcare costs as early as possible. Don’t touch it unless you fall ill.

• Get Adequate Health Insurance

As a senior citizen, you must buy health insurance that caters to your specific needs. But remember that the cost of your health insurance will be higher than that of regular family plans. However, you need to understand that you are now at a higher risk of health problems and the treatment will probably be slow and costly. So, it is very important for you to get senior citizen health insurance. Also keep in mind that you need to get as much insurance as you can afford. Do not try to save money by getting less cover. This is not a place where you want to take risks because if your insurance runs out midway during treatment, you will be in a lot of financial trouble.

• Keep Investing to Grow Wealth

As you will not be working a day job anymore, you will need to be reliant on every other source of income that you can. Counterintuitive as it may seem, it is very important now to carry on investing. Of course, as a senior citizen, the best approach for you is to choose the safest investment options like those run by the government where returns are assured. The time for risky investments is gone. It is time now for you to be a little conservative with the money. That is the reason why you should see senior citizen health insurance not as an expense but as a safety net for your nest egg.

• Start Now

If you are not yet a senior citizen, the time to wake up and smell the coffee is right now. Remember that the earlier you start, the simpler it will be for you to save. If you do not have senior citizen health insurance already, get one soon because it will be much more expensive when you become a senior citizen. If you are only on a corporate health plan, get a family floater independent of your employer. Not only will it provide an extra layer of protection now, but it will be good for you when you are between jobs or if your new employer does not offer health cover at all. Explore different retirement plan options before taking one.

To wrap up, as a senior citizen, you need to take care of your health, manage your money wisely and get the right health insurance plan. Plan early and hope for the best, but always be prepared for the worst.

Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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