Question

In 250 - 350  words briefly answer the following

1. Explain why health insurance is so important to a financial plan.

2. What are some of the ways to help control healthcare costs and describe how you can use these techniques to improve your personal finances.

Answer 1

(1). Why health insurance is so important to a financial plan:

• Starting with the statement, "Health is Wealth" it is rightly said and we should also follow the same by doing prior planning for the medical emergencies that can happen any time and we never know this.
• Cost of medical expenses are increasing day by day and with the coming of new diseases it has become necessary to have a medical insurance so that if something happens without any extra cost it can be taken care by medical insurance. So it reduces extra burden on the financial plan that we have made for the future.
• Tax-saving we all know and it is very common that on the purchase of medical insurance we get tax benefit so we don't have to worry about the taxes. So it is a double benefit for the policy holder, because we don't have to pay extra cost for medical emergencies and also for we are getting tax benefit.
• Till we have jobs all the expenses whether it is planned or not are some how taken care, but after the retirement every penny is very important and if you have medical insurance combined with your financial goal you don't have to worry about the extra money for medical emergencies.

Thus, medical insurance is very important to have because it saves lot of money that can be used any where else and also make a financial plan work smoother.

(2). Ways to help control healthcare costs:

• The first and most important way to keep healthcare costs in control is to buy health insurance. There are many insurance plans in the market to buy one, we should consider the following points:

(i). premium

(ii). Deductible

(iii). Copayments

(iv). Coinsurance

(v). Network

(vi). Coverage

• Use an HSA plan with eligible high deductible plans, HSA is a health savings account which gives the facility of triple tax benefits, money invested tax-free, grows there tax-free and comes out tax-free.
• Make the use of wellness programs, participate in bio-metric screening to check blood-pressure and cholesterol. Complete a health risk assessment. Enrol and participate in a physical activity programs.
• Get free preventive care, try to treat minor problems before it converts into big diseases.
• Make smart lifestyle choices, healthy lifestyle is the another way of reducing your burden on financial plan.