More and more Americans are struggling to make ends meet and having to make serious decisions about seeking medical help, a new report has revealed. Here’s the full story.
Healthcare Cost Management
Managing healthcare costs has become a real challenge for many American families – especially those earning under the national average income of $75,000 a year.
Insights into Healthcare Struggles
A recent report by Assurance IQ looked into the struggles this is posing to families, using data from over 5000 adults.
Skipping Doctor Visits
Balancing money and health has never been harder. Nearly half of people surveyed (46%) said they skipped going to the doctor when they needed to because they were worried about the bill.
Financial Priorities
56% of these weren’t sure if they could afford it, while over 40% didn’t know if their insurance would cover their visit, and others were afraid a visit would cause their insurance costs to go up.
Generational Trends
Avoiding the doctor was more likely to happen in younger generations, with 67% of Gen Z and 62% of millennials admitting they’d prioritize their wallet over their health, but a notable number of people making more than $150,000 a year also skipped medical care because of the cost – 39%.
Lack of Awareness Among Americans
Assurance IQ found that understanding health insurance isn’t easy for a lot of people – regardless of age.
Health Insurance Deductibles
Most Americans (65%) don’t know what their health insurance deductible is, which means they might not be prepared for how much they’ll have to pay out of pocket for medical expenses. This makes it hard for people to pick the right insurance plan that won’t cost too much.
Financial Strain
Getting hit with a big medical bill can cause a lot of stress. Many people end up using credit cards (43%), cutting back on spending (42%), working more hours (21%), or even taking out loans (12%) to cover medical costs.
Consequences of Healthcare Costs
This kind of financial strain can cause a lot of stress, and it results in a lot of people skipping other bills and avoiding the doctor in the future.
Financial Preparedness
The study noted that those who make more money are better prepared to handle surprise medical bills, with around three-quarters of people earning over $150,000 responding that they could pay their deductible if they had to, compared to less than half of those earning less.
Stress and Healthcare Costs
Avoiding healthcare because of costs can make things worse, as 47% of respondents who skipped seeing a doctor reported feeling very or extremely stressed, compared to just 17% who bit the bullet and saw a healthcare practitioner regardless of the cost.
Long-Term Financial Security
One key area that Assurance IQ found that people were lacking was long-term financial security. People have simply not got enough money saved away for emergencies – an issue that could quickly propel someone into poverty.
End-of-Life Planning
The survey notes, “If a breadwinner passes away, a family might not be able to maintain their mortgage or rent payments. If a caregiver passes away, suddenly the cost of care is a fresh burden. A funeral and burial can also be costly.”
Disparities Based on Income
Most Americans (56%) worry about their family’s financial future if they were to die, regardless of their income. Lower-income households, however, earning less than $75,000 are less prepared for these situations than higher earners.
Wills and Legal Documents
According to the report’s findings:
Only about a third (33%) of Americans earning less than $75,000 have made a will, compared to almost half (49%) of those who earn over $75,000.
Saving for Funerals and Burials
When it comes to saving money specifically for final expenses, like a funeral, only 20% of those with lower incomes have done it, while 32% of higher earners have.
Life Insurance
Getting life insurance is another smart move, but only around 30% of lower-income households have it, compared to 48% of higher-income ones.
Planning for Unforeseen Situations
35% of people earning less than $75,000 haven’t made any plans for these emergencies, while just 18% of higher earners haven’t done anything.
Accessibility Issues for Lower-Income Americans
Allison Arzeno, CEO of Assurance IQ, pointed out that many lower-income Americans are unable to get help with financial planning. “This research indicates that for too many Americans, personalized support around end-of-life planning is likely out of reach,” she wrote.
Challenges in Financial Advice
“Financial advisors tend to prioritize clients with significant assets, which leaves lower-income Americans to figure out a complex financial system on their own. Not having a safety net can cause a family to cycle in and out of poverty and prevent them from creating financial stability.”
Featured Image Credit: Shutterstock / Varavin88.
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For transparency, this content was partly developed with AI assistance and carefully curated by an experienced editor to be informative and ensure accuracy.
