Financial planning

Health and Wealth: Financial Planning for the Bleeding Disorders Community

To secure your financial future, you need a plan—especially if someone in your family has a bleeding disorder. Here’s what you should know.
Author: Lindsay Goldwert

When you’re juggling money to manage the day-to-day of paying bills and running a household, the prospect of projecting your finances in the decades to come can seem impossible. But by making a financial plan for your future, you’re creating a system that gives you the means to do all of the things you want to do in life and also handle the unexpected along the way.

Brian Andrew, executive vice president of wealth and chief investment officer for Johnson Financial Group and a board member of the National Hemophilia Foundation, shares his thoughts on why it’s important to have a financial plan, what that plan can include and how to begin putting one together.

Q: I’ve never been great with money. How can I start a financial plan?

First of all, it’s OK to feel overwhelmed. Most people don’t have a financial background and have never done much beyond budgeting or saving for retirement.

Still, you want to be financially prepared for the future rather than just figuring things out when times get tough. A financial plan helps you take control and put your money to work the way you want it to.

A good early step to financial planning is asking yourself some big questions: What do I want to do with the rest of my life, and how can I afford that? What would I do if I retired or suddenly couldn’t earn any more money? How will I be able to afford treatment for my bleeding disorder as I get older? What would my family do for money if something happened to me? The answers to these questions will begin to form the foundation of your financial plan.

The National Hemophilia Foundation is a great place to go for help with your financial plan. Its staff members are experts at understanding and navigating issues like these on behalf of the bleeding disorders community. They’ve helped countless people just like you.

Q: What exactly is a financial plan?

A financial plan is a comprehensive look at your financial situation to help you understand where you are now and the steps you need to take with your money and other assets—anything that you own that has value—to achieve your goals and objectives later in life.

Financial planning means more than having money in the bank. It can include specialized accounts, such as retirement accounts and health savings accounts, and ways to protect your assets—through insurance, for example. Legal documents such as trusts and wills can also be part of your plan. They direct where your assets should go if something happens to you.

Your financial plan will be unique to you, depending on what you want your money to do and how you want to budget for life changes and emergencies.

Q: Do I need a special financial plan because I or my kids have a bleeding disorder?

Yes. Besides saving for your retirement or your children’s college costs, your financial plan should account for extra healthcare needs because of your bleeding disorder, such as the high cost of medications, deductibles and hospitalizations, and limitations in health insurance coverage.

An example of a cost that you might need to plan for is a loss of health insurance. Your financial plan will prepare for this potential emergency and provide a financial cushion so you can continue to receive treatment.

Q: What are the best ways to save money for my future?

Contributing to your 401(k) at work or opening an individual retirement account, or IRA, are both great ways to save on taxes and build wealth for retirement. Also, opening a health savings account, or HSA, may be an option to save for retirement.

You contribute pretax money to an HSA, similar to a 401(k) or an IRA, but you pay no taxes on the money you take out to pay for eligible healthcare expenses. Also, the funds in your HSA roll over year after year, so there’s no need to worry about having to “use it or lose it.” An HSA may earn interest, which is not taxable.

Plus, at age 65, you can use your HSA money for any purpose, not just for health expenses, without a penalty.

Q: Can I open an HSA even if I’m self-employed?

Yes! If you are enrolled in a high-deductible health insurance plan offered through many insurance marketplaces, you can most likely qualify for a health savings account. Bear in mind that some plans have high deductibles but don’t qualify you for an HSA. When you’re signing up for health insurance, look for plans tagged “HSA-eligible.”

Q: What should I know about the health insurance my employer provides?

When you sign up for an insurance plan, it’s important to understand where it falls short or if there are lifetime caps on your coverage so you can adjust your financial plan accordingly. When you choose your health insurance plan, you’ll want to weigh the cost of pricier plans that allow you to see your doctors in-network and any copayments and deductibles, which could affect your finances in the long term. Never be afraid to ask your company’s human resources or benefits coordinator to explain the differences among the plans to help you make the right choice.

Q: I’m finished with school and getting ready to start my career. What employee benefits should I look for?

In addition to contributing to your 401(k) to save for retirement, look for benefits that can help you save for chronic health issues now and in the future. If you have a bleeding disorder and you’re looking at two companies, one that has a health savings account and one that doesn’t, you might consider the job that offers the HSA because of the potential value.

If you start to save money in an HSA at age 25 and continue for 40 years, you’ll have a substantial amount to cover healthcare costs. Plus, it’s money you can access anytime for eligible healthcare expenses, which is a great addition to your emergency savings.

Q: Why is creating a will important for financial planning?

No matter how many assets you have or how healthy you are, creating a will is an important part of your financial plan. A will is a legal document that allows you to identify who will receive your personal belongings and assets after you die. If you have minor children, you would use your will to choose a legal guardian to look after them—otherwise, a court will appoint a guardian. If your child has a bleeding disorder, choosing a guardian gives you greater control in deciding who is best to provide care.

Q: How can I make sure my children have money in the future without affecting their eligibility for public assistance?

For parents of children with bleeding disorders, a special needs trust can offer peace of mind that their money will continue to be used to provide financial security and continued, high-quality healthcare for their children, without endangering their eligibility for government benefits.

These trusts can be tailored to your situation. For example, you can specify that the money you put in the trust be used for your child’s healthcare expenses and nothing else. This will help the child’s guardian, who may not be familiar with all of the issues associated with bleeding disorders, including health insurance and healthcare costs.

Crucially, distributed funds from a special needs trust won’t disqualify the beneficiary from public programs, such as Medicare. It’s worth talking to a financial planner or an attorney who understands special needs trusts.

Q: I don’t have a lot of assets. Why do I need to make a will?

Although you may not think you have a lot of assets, you probably have more than you realize—maybe you own your home, you have a car or two, or you inherited some jewelry or other heirlooms of value. Creating a will makes it clear who gets these things after you die.

Besides your belongings, a will names the person you choose to look after your minor children, which is particularly helpful if a child has a bleeding disorder and needs specialized care.

The direction you provide in your will avoids confusion among family members and ensures your loved ones are cared for. It’s best to speak to an attorney to walk you through the process.

Q: Who can help me with financial planning?

It’s a good idea to speak to a financial planner, who can review your financial situation, listen to your goals and help you come up with ways to optimize and adjust your finances to reach those goals.

Try to find someone who has experience planning for people who have a bleeding disorder or who understands the costs involved with managing a chronic illness. The National Hemophilia Foundation can be a tremendous help in referring you to experts who know what you’re dealing with.

Secure your financial health: The National Hemophilia Foundation has a wealth of information about building up savings, making smart investment decisions and protecting against possible financial catastrophes. Visit stepsforliving.hemophilia.org/step-out/financial-health