Self-Employed: How to Manage Your Health Care Expenses
Many Canadians are attracted to the freedom and flexibility of self-employed, but the costs of additional transform health and wellness such as prescriptions, eyeglasses, and dental visits, can add up to the point where it becomes more cost-effective to have a job that offers benefits.
Several months after graduating from the University of Toronto, Matthew Filipowich received a hefty bill for a root canal treatment: it was $1,500.
The 23-year-old graduate was then a freelance photographer and did not have additional health care insurance.
“It was very difficult.
I was a student, I graduated, started my own business, then all of a sudden, I found myself with a bill of $1,500,” he says.
“It was very overwhelming. What would have happened if I had had complications? If I had to go back there? What would I have done? Have been caught with a hole in the tooth.
The number of self-employed people in Canada continues to grow. It reached nearly 2.7 million in 2011, compared to 2.3 million ten years earlier, according to data compiled by Statistics Canada.
This growth tends to accelerate during economic downturns. A report by Statistics Canada indicates that the number of self-employed workers increased by 3.9% between October 2008 and 2009, at the height of the recession.
At the same time, the number of paid jobs fell by 1.6% in the public sector and by 4.1% in the private sector.
In other words
Almost 100,000 people started self-employment during this period, while the number of salaried employees fell by almost a million.
Certified Financial Planner Mark Halpern believes that the rise of small businesses has contributed to this movement towards self-employment.
As a result
We have an important number of people who perhaps took what they had for granted, who no longer perceived that umbrella over their heads, that defense that their social benefits afforded them.
Although Canadians enjoy a publicly funded health care system, many services are not covered by this insurance, including dental care, physiotherapy, prescription drugs, and eyeglasses.
However, according to some self-employed people. Including Jeff Chatterton, insurance plans that cover these additional services. Are too expensive, with a starting price hovering around $300 per month. Mr. Chatterton, who has a communications office in Kitchener, Ont. Says his family is in good health. So it is not cost-effective for them to take. Out insurance to cover the costs of a simple cavity or an occasional prescription.
He admits that it would be nice to have insurance. But hey, let’s say I make sure to clean my teeth with dental floss.”
Some, like Mr.
Fillipowich, applied for insurance but were turned down due to health issues.
He said that it is disheartening to search for assistance. And be told that you cannot be insured unless you have a faultless medical record.
Insurance advisor Barry Greenberg recommends that Canadians create. A dedicated health care spending account because it’s impossible. To get turned down and offers more flexibility in how you spend your money. silver.
With such an account, a recipient makes a lump sum payment and then sends in receipts for their psychological healthcare expenses, which are reimbursed to them by the company taking the money from that account.
The principle is therefore similar to that of a savings account. But it allows the beneficiaries to deduct the costs from the income tax they must pay. If the money is not fully spent in one year, the balance is carried over to the following year.
Finally, Mr. Halpern recommends taking out emergency insurance, which costs $10 to $20 a month, to deal with larger contingencies. It reached nearly 2.7 million in 2011, compared to 2.3 million ten years earlier, according to data compiled by Statistics Canada.
