When you are a 22-year-old graduate, just released into the world, your understanding of financial management may be a little off. For example, I had no idea what an emergency fund was, nor that you needed one at all times. You can imagine my shock when I had to pay for a root canal right out of college as a new transplant to New York City.
You know the saying, “you live, you learn”? Well, I definitely learned through this ordeal. Hopefully, I can pass on some of my lessons so you don’t make the same costly mistakes I have made.
If I could have lived through the process again there are a few things I would have done differently to have saved myself the huge costs. Here are some tips that will hopefully help you if you are ever in this situation, or even prevent you from getting into the situation.
How I Should Have Prepared for My Large Dental Cost
1. Be Prepared and Plan Ahead
Not expecting added costs was my biggest mistake in the whole dental process. Upon graduation, I had responsibly set aside money for my move to NYC and even enough to live job-free for a few months. After the shock of paying first and last month’s rent plus deposit, my fund was crushed, but I still had enough to get by for a few months. Then I started getting earth shattering headaches and pain in my tooth – anyone who’s had tooth pain knows I’m not exaggerating.
Unfortunately, I hadn’t set aside three to six months income for situations like this and did not have dental insurance. This toothache came at an epically bad time, but sickness and accidents typically do.
2. Shop Around for Dentists
After consulting Yelp, I found a doctor who was very accommodating to those without health insurance and was close to where I lived. When I went to visit, he told me that he could waive the X-ray and consultation fee, which saved me about $150. I instantly trusted him, imagining all the other things he could “waive” for me. At the end of the visit, he confirmed my fears and told me that I indeed needed a root canal.
Here is where I made my second big mistake: I decided just to go to this doctor because I trusted him, had a good experience and decided it was easier than meeting with multiple dentists.
3. Calculate the FULL Price of the Procedure (and Ask About Additional Follow-Up Procedures)
This seems like a pretty obvious step when you have such a big payment to cover. But as a naive college graduate, I just asked how much the root canal would cost. Whether I was naive or the dentist wasn’t transparent, is up for debate, but he only told me the cost of the root canal procedure which was $1,900 without insurance. You can imagine my surprise and anger when I found out the follow-up procedure for a new crown to cover the tooth would be an added $1,200!
I got the first procedure at this office, but to help pay for the follow-up procedure with the crown, I decided to get a second job.
4. See If You Can Create a Payment Plan
I decided to pay for my root canal through a company called CareCredit.com, a credit card for health care procedures. After seeking the advice of my parents, I set up a plan where I paid $200 a month until my first procedure was completely paid off.
Although I initially wanted to knock out the payments as quickly as possible, I was advised to do smaller payments over a longer amount of time. This worked out better because as long as I completed the payments by a set date, I would not have interest paid on the card.
This plan is not available at all doctors’ offices and you may not be eligible for one of these no-interest plans.
5. Look for Yearly Insurance Plans
This may not be for everyone, but this plan I’d found through Careington.com, an insurance plan site, ended up being my saving grace. The only reason I trusted Careington was because a co-worker recommended it. Sites like this need to be thoroughly investigated some may not cover the procedures you need or work with the doctors you need.
After paying $70 for the entire year, I was able to get my second procedure for $600 as opposed to the $1,200 it was originally going to cost. I did, however, need to get the second procedure done at a different office that accepted this plan.
All in all, I ended up saving $530 on the second procedure. When you’re a broke college grad, $530 is a lot of money. Had I known about this plan earlier, I could have paid $580 for my root canal as opposed to the $1,900 I shelled out in the first place.
How You Can Prepare Your Budget for Future Medical Costs
These are some of the ways I wish I had prepared for my dental procedures, but there are many more ways to prepare your budget for future medical costs. Having the right medical insurance and understanding your healthcare coverage is a start, but that’s not all you can do.
1. Get to Know Your Family Medical History
When it comes to health and finances, the more you know, the better off you’ll be. Ask your parents about health problems they encountered around your age and into their later adulthood. This can help you understand what to be aware of and learn about preventative medicine that can help you get ahead of future problems. Better to not have the cost than to need to save for it, right?
On that note, consider genetic testing if there are chronic diseases in your family history. If a doctor can tell that you are more likely to encounter an issue, they can help you take measures now to either prevent, manage, or avoid it. It certainly doesn’t hurt to ask.
2. Shop Around for All the Doctors You Need Before You Need Them
After you get to know your medical history, make a list of the types of doctors you’ll likely need to see. For example, you could seek out the best general practitioner for you, but also look at a doctor who helps with migraines if that’s an issue you experience or a GI doctor if you tend to have digestive trouble.
By knowing who you want to work with before problems arise, you can make sure to look for insurance that they work with – or at the very least understand the likely cost that could come up for various procedures. Plus, it’s a lot easier to handle an issue when you have a list of names and numbers on hand than if you have to take to the internet to look for help.
3. Create a Healthcare Budget – and Contribute to It Monthly
After you have an understanding of your family medical history and the cost of your preferred doctors, start working on a healthcare budget. The amount you contribute to this budget every month will vary based on what you can afford to save for this and based on the likelihood and severity of potential issues.
As you go through adulthood and find that your pay increases, don’t forget to revisit your budget and increase the amount you’re contributing. Best case scenario is you’ll never need it and this will just be extra money in your savings. But if you need it, it will feel a lot better to know it’s there.
4. Take Advantage of an HSA or FSA If You Can
If you start a new job and the employer offers an HSA (Health Savings Account) or FSA (Flexible Spending Plan), jump on it. This is tax-free savings that can be used for healthcare costs and can be a tremendous help in times of need. The main question is how much to take out. You might want to max it out considering it can cover more than just office visits (think prescriptions as well), but you should still spend some time reviewing your potential need before you decide the amount to take out.
3. If All Else Fails, Use a 0% Interest Credit Card to Pay
If you do find yourself in an emergency like the one I did and you don’t have enough money to cover it, consider taking out a 0% interest credit card. This is a great opportunity to borrow without losing a ton of money to interest.
There is a caveat to this, however. If you take out one of these credit cards to pay for a medical emergency, make sure you create a payoff plan for the card immediately. Good intentions may lead you to believe that you don’t need a plan, but things can happen and those balances might drag on a little too long. If you find yourself in a situation in which your balance wasn’t paid off by the time the credit card interest rate went up, use a balance transfer credit card to buy some more time without interest. But make sure you make a payoff plan so this doesn’t become an endless cycle.
It’s Never Too Late to Prepare for the Future
If you’ve already endured a crisis like mine or find yourself in the middle of one right now, it’s easy to think that you’ll never see the light at the end of the tunnel. But it’s never too late to prepare for the future.
Follow the steps mentioned above to get through this situation and then immediately get to work on plans that will get your finances ready for future medical emergencies. As frustrating as these experiences can be, taking control and moving forward is a fantastic (and practical!) way to remind yourself that you right the path.