What ifs like accidents and injuries are scary enough to think about on their own. Even with the right medical attention, though, these unfortunate events can have financial consequences that linger after you’re back up and running.
You may know that supplemental health plans like critical illness or hospital indemnity insurance can help absorb these shocks by paying you cash to cover expenses like medical bills, rent and even loss of income — but that doesn’t mean you have room in your budget now to protect your budget later.
Here are four simple ways to save money to build the cost of supplemental insurance into your budget. Taking these steps will make less of an impact on your wallet than you may think, and it could save you a lot of worry down the line.
Audit All of Your Expenses
First, get a handle on exactly where your money is going. Download an app that tracks your spending to see which of your existing expenses you aren’t really maximizing. Is there a monthly membership fee to a club you don’t really frequent? What about a subscription to a magazine or streaming service you don’t really use?
Reevaluating your budget to find the areas in your spending that aren’t offering you the value you expect can help you find expenses that can be reduced, cut or rerouted toward your true top priorities.
Trim Your Top Expenses
One of the easiest ways to build a new line item into your budget is by finding ways to save money on your biggest expenses, like housing, food and transit. So consider how much money having a roommate or renting out a spare room — or even a parking space — could free up in your budget. How much could you save by carpooling or using public transit? By meal planning, cooking at home or bringing lunch to work?
Even a small reduction to these top expenses could generate more than enough savings to pay for supplemental insurance.
Save Your Savings
Sometimes we encounter savings without actually treating them as savings. If you use a coupon to get $10 off your groceries or 20 percent off a delivery, what do you do with that money? Chances are you spend it on something else — and maybe even treat yourself to something you wouldn’t otherwise have bought.
So the next time you see something to the effect of “You saved $22.49” on the bottom of your receipt, schedule an immediate transfer from your checking account into your savings for the total amount saved. Depending on how savvy a shopper you can be, you might be surprised by the amount you’ve saved at the end of the month.
Use a Microsavings App
Imagine covering the cost of your supplemental insurance needs just by saving your spare change. A microsavings app that rounds up your purchases to the nearest dollar and saves your change virtually can help you do just that. Though you’ll hardly notice it at the time, this spare change can really add up.
There’s a range of automated savings tools out there, though, so do your research to figure out which one makes the most sense for your situation. (And watch out for apps that come with fees, which can take the legs out from under your good intentions.)
It can be hard to plan for the future, especially when you don’t know what it may bring and when the present offers plenty of pressing worries on its own. That’s why it’s smart to find savings strategies that don’t take a toll on your day-to-day life. If you’re having trouble getting started, remind yourself that putting aside a little money now can save you from some major costs later.