62% of all bankruptcies in America are driven by health insurance and medical care costs.

Unexpected costs can be financially devastating for families, especially for those without a sound healthcare budget. It can also take a toll on a family’s health and well-being when fitness, routine exams and nutritious foods suddenly become too costly. But, by determining expected costs, trimming where you can, and planning for the unexpected, you can save money and boost your health.

1. Determine your fixed and variable costs, and plan for unexpected expenses.

It’s fairly simple to determine your fixed and variable costs. Fixed costs are regular monthly amounts you are expecting – like health insurance premiums, whereas variable costs are out-of-pocket costs that are usually small but routine—like prescription medications, co-payments, etc.

Unexpected costs are bigger out-of-pocket expenses that are unpredictable, and could lead to a financial or health crisis. This includes car accidents, chipped teeth, and trips to the ER—which could run anywhere from $1,000 to $2,000. You should set aside an emergency fund so that unexpected expenses don’t take a toll on your health.

2. Take a look at how HRAs, HSAs, and FSAs work for you.

HRAs (health reimbursement arrangement), HSAs (health savings account) and FSAs (flexible spending account) are special savings accounts that can help you budget and save money for health-related expenses, so that you don’t have to sacrifice your health later. Consider using the money you save in these accounts to help fund your unexpected expenses.

Once you’ve estimated your fixed and variable costs, you can put that amount into an employer-sponsored HSA or FSA with pre-tax deductions. (Note that FSA funds do not roll over from year to year, so you should only put in what you know you will spend before the end of the plan year.) HRA and HSA funds do roll over, but unlike an HSA, HRA expenses and limits are determined by your employer.

3. Review your current health spending.

Gym memberships, massages, acupuncture, and high-quality foods are great investments for your health – but does your budget have room for it all? A gym membership may be worth the money for its health and mood-improving benefits—but the personal trainer may cut into your health care budget, or take away from your unexpected expenses budget. And fresh food you cook for yourself is great—but buying organic may reduce the amount you have left to spend on regular dental and vision care. There are no right or wrong answers for examining your current health care spending. The goal for your review should be to identify areas where you can cut back without sacrificing health benefits.

4. Get back into a routine.

If you’re skipping routine dental visits and annual eye exams to avoid co-pays or out-of-pocket expenses, you are doing yourself a disservice. Skipping out on these routine exams can cause serious health consequences. For example, a cavity left untreated can lead to inflammation, gum disease and more expensive treatment later. Skipping your annual eye exam can leave you vulnerable to blinding eye diseases that often have no symptoms in beginning stages. Exercising and eating healthy regularly is a great way to boost your health, which in turn leads to fewer doctor’s appointments and costly health problems in the future.

Read more on how routine exams can make your wallet happy here.

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