4 Healthcare Strategies for Retirement

Medical crisis is the number one cause of Filipino family bankruptcy. Almost every 5 to 7 years medical cost doubles and has killed a lot of sick people not because there is no medicine but because of no money. Most Filipinos don't have money for future healthcare needs because a lot depend on government health benefits and company short-term HMO. The challenge with traditional healthcare company is that it no longer covers ages 61 and up, and that you can not bring with you the healthcare benefits of your company once you resign or retire. Thus, a lot may depend on their children, sell their properties at lower values, close their businesses, deplete their retirement pay or worst, go into debt during retirement to fund their medical expenses.

Are you ready for retirement?
Are you ready for retirement?
Because of this situation, a lot have designed different strategies to cope up with future medical expenses. Here are some ways that may prove effective in preparing for future healthcare needs.

1.  Set up a specific bank account intended for health savings
One may set aside a fund for healthcare needs in a separate bank account. The challenge is that the fund will have minimal to no growth. Since it is very liquid, accounting human nature, we may easily access our funds not intended for healthcare purposes.

2. Have a mutual fund account for healthcare needs
A very effective way to grow money especially when there is a long period of time for accumulation and compounding. The challenge is that when the market or economic condition is down, the funds may also experience negative growth. By the time we get sick at a down market, we may withdraw funds at a loss.

3. Have a mutual fund while accumulating and transfer it to a low-risk vehicle like bank or bond fund at retirement
This is a very strategic way to approach a healthcare fund. We experience high growth while accumulating and when we retire, we transfer the funds in a low-risk but low-return vehicle. The returns may now be low but with big savings, even how low the interest rate is, the amount of interest may already be big enough. The challenge is not all Filipinos are financially literate to follow this strategy.

prepare for long-term healthcare needs
We need to prepare for retirement especially our long-term healthcare needs
However, when we get hospitalized, we can not show our mutual fund certificates to get inside the hospital. A downpayment or health-card is required. Thus, cash is still king. Some may opt to use credit card for downpayment, but again, we don't go into debt (another problem) when we are in an emergency (the main problem) situation. It does not also give us peace of mind, while we are sick, signing redemption forms for our mutual fund accounts and wait a week or two to receive the proceeds of our fund.

4. Open a long-term health savings account
Long-term care is already popular in other countries but in the Philippines, it is still in its infant age. As of the moment, only one company is offering Filipinos a long-term health savings account. This fund is designed for you to save in your early age and expect it to accumulate and grow for our retirement years. It is a medium-risk and medium return investment designed to give us peace of mind when we get sick at older years. It has the same benefits as a traditional HMO (esp. having a health-card) but covers a person beyond ages 60 and up as long as there are still funds inside the account. It works like a mutual fund, giving conservative returns but protects your fund in case of bad economic conditions. The challenge is that this fund may cost a little higher for the price of convenience.

IMG, being a financial broker, we are proud to say that we are the exclusive distributor of the only company offering Filipinos here and abroad long-term health savings account, Kaiser International Healthgroup, Inc. Keep posted for updates as we discuss how Kaiser works.

A note to remember: some insurance companies are offering people health insurances. This is to note that health insurance is different with healthcare. Normally it is a life insurance benefit, that why it covers critical illnesses or dreaded diseases. From the terms "critical" or "dreaded", it is near death thus it does not cover sicknesses or illnesses not listed or considered as critical. More about this on future posts about life insurances.

Want to experience a life of FINANCE, BUSINESS and INVESTMENTS? Experience #LifeatIMG. Be a member now! (Click here)

Want FINANCE, BUSINESS and INVESTMENT updates? Make sure to subscribe to our free email newsletter and/or follow our social media accounts.

PS: Do you want to learn and invest in the Stock Market? Let Bro Bo Sanchez be your financial and spiritual mentor. Join us here: --> Truly Rich Club 2.0