Making financial plans for unexpected, serious health issues is key, say financial advisors. Access to an emergency fund, even if it’s through a secured line of credit, can help make ends meet.
For Kathy, the breast cancer diagnosis came the night before she and her husband were set to break ground on construction of their new home.
It wasn’t until five months into her treatment that they realized the impact on their finances, given the additional expenses on the self-employed couple’s new home and her diagnosis.
“The pressure and the extra unplanned stress was definitely there, but it was all the timing,” said Kathy, who asked only her first name be used.
“You can’t plan for cancer.”
Making financial plans for unexpected, serious health issues is key, say financial advisors. Access to an emergency fund, even if it’s through a secured line of credit, can help make ends meet.
It’s very important at the very beginning, sometimes before treatment starts, that you can get a handle on your financial resources so it doesn’t stress you out further.
If a cash reserve is not an option, advisors suggest a line of credit secured by your home, as they offer the lowest interest rates.
Certain expenses associated with treatment, such as travel for specialized treatment, may also be eligible for a tax credit.
Statistically, 69% of the major health event claims for an insurance company in Canada sees are for cancer, compared to, for example, 11% for heart attacks.
Breast cancer itself affects one in nine women, with an estimated 23,800 women and 200 men expected to be diagnosed this year alone, according to the Canadian Breast Cancer Foundation.
Group and individual health insurance plans will help if a person has to take time off work for themselves or to care for their spouse.
Critical illness insurance also pays out a lump sum that gives you flexibility to do a lot of things you need to do while you’re fighting this health event, whether it’s child care or home care, your spouse taking time off work.
While Kathy, 38, and her husband had savings and real estate investments to fall back on, they didn’t have a drug plan or life insurance. Many of Kathy’s medications and procedures were considered non-traditional and not covered by the provincial health plan.
The couple got by those savings and the sale of a property, but Kathy said she wished she would have purchased insurance long before her diagnosis.