Living with a disability comes with several challenges, to say the least. However, one thing that can be particularly tricky is planning for the future. Financial planning is essential to ensure you can receive the level of care you need later on in your life. Here are some concrete ways to get your financials in order for the future.
Protect Your Loved Ones with Insurance
Insurance can help offset future financial burdens faced by you and your family. Long-term care insurance, for example, will cover nursing home care and in-home health care once you reach the age of 65. Life insurance is another common option for people with disabilities who have dependent children or spouses. You can combine the two by getting life insurance with a long-term care rider. This will let you use your life insurance payout to cover long-term care if you need it. If not, your benefit will go to your beneficiary when you die.
Another type of insurance you should consider is burial insurance. Burial insurance can be beneficial to protect the future of your loved ones from any financial burdens you leave behind. Your family members can use burial insurance to pay off your debts and cover other final expenses like your funeral or memorial service. Check out this guide from Lincoln Heritage Funeral Advantage to learn more about your options. When you’re deciding how much coverage to get, consider your final wishes and how much debt you may be leaving behind.
Build Up an Emergency Savings
While an emergency fund won’t be able to cover the costs of long-term care, it can keep you from financial ruin if something unexpected occurs. People rely on emergency funds to get them through periods of unemployment, unexpected home repairs, or sudden illness. Unfortunately, less than one-third of Americans have saved six months of living expenses. Set up a direct deposit into an emergency savings account so you can start building up this essential fund.
Focus on Paying Down Debt
Debt is a serious threat to your financial security. As long as you have debt, you’re losing money that you could be saving for your future care needs. Without debt, interest payments could go toward your emergency fund or long-term care insurance. Focus on paying down your high-interest debt first. Wise Bread recommends transferring your credit card balance onto a new card with a zero-interest promotional rate while you pay it down.
Follow a Budget
Budgeting can help you build up your savings, pay down debt, and plan for any future care expenses. Start by determining exactly how much money you spend each month. Add another 10 to 15 percent to this number to account for unplanned expenses or bills you may have missed. Then, add up all of your income sources and set your financial goals. If your budget reveals that you don’t have enough extra income to meet your savings or debt payoff goals, you’ll have to make some budget cuts. Remember, small purchases add up!
Access Your Benefits
Remember to take full advantage of any benefits available to you. For example, Social Security Disability Income (SSDI) can help you cover your living expenses if you’re no longer able to work in the future — as long as you’ve accumulated enough work credits over your life. People with permanent disabilities who cannot work, however, can still receive income assistance with Supplemental Security Income (SSI).
People with disabilities also have several health coverage benefits, including Medicare, Medicaid, and the Affordable Care Act Marketplace. If you obtained your disability while serving in the military, you may be eligible for compensation or healthcare benefits through the Department of Veterans Affairs (VA). Once you’re 65, you’ll also be eligible for Medicare Advantage. MA plans from Aetna and other insurers can cover dental and vision care and wellness programs. Take some time to learn about these benefits so you don’t miss out on the valuable assistance you’re entitled to.
Anyone who wants to enjoy a financially secure future needs to start planning today. Consider getting insurance, pay down debts, start saving, and gain access to your benefits. Try to anticipate your care needs and set financial goals so you can afford safe and high-quality care.
Ed Carter uses his financial abilities to help people with disabilities plan ahead, as physical and mental disabilities often cause stress and confusion when it comes to financial planning. He created ablefutures.org to help people with disabilities prepare for a secure and stable financial future.