Save for med­i­cal ex­penses

Weekend Argus (Saturday Edition) - - PERSONAL FINANCE -

Even if you be­long to a med­i­cal scheme, it is likely that you will in­cur some med­i­cal ex­penses that are not cov­ered by your scheme.

Com­pre­hen­sive med­i­cal scheme cover has be­come un­af­ford­able for many peo­ple, and most schemes now fo­cus on cov­er­ing you for ma­jor med­i­cal ex­penses and some ba­sic day-to-day needs. This of­ten means you need to dig into your own pocket at some stage dur­ing the year for out-of-hospi­tal treat­ment.

Set­ting aside a reg­u­lar amount to pay for out-of-pocket med­i­cal needs may help to soften the fi­nan­cial shock to your bud­get.

Some scheme ad­min­is­tra­tors of­fer med­i­cal sav­ings plans that are not part of the med­i­cal scheme. Th­ese may be a good idea if:

You are al­ready con­tribut­ing to your med­i­cal scheme the max­i­mum amount you can deduct from your tax­able in­come for med­i­cal scheme con­tri­bu­tions (R625 a month for a sin­gle mem­ber, R1 250 a month for a mem­ber and the first de­pen­dant, and an ad­di­tional R380 a month for any fur­ther de­pen­dants); and

You are the kind of per­son who may be tempted to raid your sav­ings ear­marked for med­i­cal ex­penses for other pur­poses, be­cause money saved in th­ese prod­ucts can be used only for med­i­cal ex­penses.

If you are more dis­ci­plined, you may find lower-cost and higher-in­ter­est-pay­ing sav­ings prod­ucts else­where.

If your med­i­cal scheme of­fers pre­ven­ta­tive health­care ben­e­fits such as pap smears, prostate checks and mam­mo­grams, re­solve to use them this year. De­tect­ing an ill­ness early on could save not only your health but also your scheme ben­e­fits.

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