Most people believe they’ll financially secure by the end of their career. Unfortunately, this isn’t always the case. More retirees than ever are filing for bankruptcy. According to a study from Debt.org, people aged 55 and older account for 20% of total bankruptcy filings and many of these individuals are considered financially responsible. That figure has doubled since 1994.
What could be the cause of this upward trend? For many, the culprit is outstanding medical bills. They aren’t just crippling to those without medical coverage. Many people fall through the cracks of health insurance and Medicare coverage on things like dental care, eye care, and even long term health care. According to The Motley Fool, the average 65-year-old couple retiring today can expect to pay upwards of $275,000 in medical bills during their retirement.
How Can I Avoid Bankruptcy?
While there is no one way to guarantee you’ll avoid financial hardship, there are a few precautions you can take to better prevent medical bills from affecting your future.
- Build an emergency fund with 3-6 months’ worth of expenses
- Open a health savings account (HSA) to invest pre-tax dollars in your medical expenses
- Take an in-depth look at what Medicare does and doesn’t cover so you’re not surprised
- Maximize your social security benefits
For more information, check out this article by The Motley Fool.