28% of Americans in medical debt were forced to make this difficult choice

It is a decision that could have serious consequences.

The COVID-19 pandemic has caused a world of financial turmoil for many people. Not only did millions of people lose their jobs during the crisis, many of those who were able to continue working were still struggling with lost income or additional expenses.

One expense that consumers struggled with during the pandemic were medical bills – so much so that 53% were forced into new medical debt, according to one. new investigationstyle = “text-decoration: underline”> Find out about personal loans. Worse yet, this debt prevents some people from reaching their financial goals. And for 28% of those with medical debt, that means not being able to contribute to their emergency savings.

The danger of having an incomplete emergency fund

The purpose of an emergency fund is to help you get through a financial crisis. It could mean having to replace a car on a whim, having to cover a massive home repair, or having to pay your bills during a period of unemployment for several months.

Generally speaking, it’s a good idea to have three to six months of essential living expenses available in a savings account. This way, if a job loss ensues, there is money to be tapped for bill payment purposes, especially in situations where a job application is rejected or delayed.

If you’ve tried to build an emergency fund but find yourself in medical debt and no longer able to contribute to your savings, unfortunately you might find yourself in a tough spot when your next personal crisis strikes. . It’s worth doing all you can to manage this debt in some way while also funding your emergency savings.

Increase your income to stay afloat

Maybe you were regularly contributing $ 200 per month to emergency savings before you were hit by a series of medical bills that are now hogging that $ 200 per month. If your salary is maxed out, you might feel pressured to ignore your emergency fund until your debt is paid off. But there might be a way to keep up with those debt repayments while still contributing to savings – by finding a second job.

Taking on a sideline isn’t always easy, especially if you have health issues or are already working long hours. But if you are able to make it work, you could be successful in reducing your medical debt while building a solid savings cushion.

Nowadays there are a lot of flexible side activities which means you can do them at home or set your own hours. Take a look at your schedule and see what’s doable. Even if you can only devote two or three hours a week to a side concert, it can help you pay off your debt while still hitting your emergency fund goal.

At the same time, you shouldn’t hesitate to try and negotiate some of the bills that got you into medical debt in the first place. Talk to your suppliers and file appeals with your insurance company for rejected claims that forced you to pay big bills.

You may not be able to get out of debt completely. But if you can get even a small part of it, it might put you in a better position to pay off the rest while working on a full emergency fund.

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John A. Bogar