So, on Monday I told you about all of my fun, ambitious savings goals for next year, right? Well, today I’m going to tell you about some of the new, not so fun categories you’ll be seeing in my budget starting next month. What could they be, you might be wondering. I’m talking about health benefits and insurance policies. Get excited, friends! Ok, don’t. But hear me out.
In September 2012, I quit my job in the BC Public Service, where I had a pension, benefits, short- and long-term disability, etc. to take a more rewarding career in a small company where I would have none of that. Has it been worth it? Yes. A million times, yes! But that doesn’t mean it hasn’t had an effect on my budget. The reason I’m putting so much into my RRSP right now, and even more in 2014, is because I don’t have a pension to fall back on. As for benefits: I’ve been living without those ever since, and I’ve had to hand out a couple wads of cash because of it.
To start the new year off right, I wanted to make a decision about whether or not I was happy living without health benefits and insurance policies. The answer: I wasn’t happy about it. And since I don’t have an Emergency Fund (yet) to support me through an expensive situation, I decided to invest in health care in 2014. It’ll cost me a small amount each month, but I took some time to shop around these past few weeks and am happy with the plans I’ve purchased. So, without further ado, here are my seriously boring new budget categories.
BC Medical Services Plan (MSP)
Cost: $69.25/month = $831/year
If anyone tells you health care is free in Canada, they’re lying. It’s cheap! But it’s not free. In British Columbia (where I live), all residents have to enrol in the Medical Services Plan (MSP) which “insures medically-required services provided by physicians and supplementary health care practitioners, laboratory services and diagnostic procedures”. Basically, it means I can walk into any clinic and be treated. And if a doctor says I need an ultrasound, x-ray, etc. then those are free. Sounds pretty good, right? I think so too.
One thing I discovered by moving to Toronto and back is that residents of Ontario don’t receive a bill in the mail for their Ontario Health Insurance Plan (OHIP) – it’s included in provincial income taxes and taken off their paycheques before they can even see the money. I’m a little sad/jealous that BC hasn’t adopted this! As of January 1st, my monthly premium is going up from $66.50/month to $69.25/month. I’m obviously happy to pay that, but would love if I didn’t have to add it as a category to my budget each month.
Note: This is a category that has been in my budget since May, but I don’t think I’ve ever explained what it pays for – now you know!
Cost: $41/month = $492/year
Onto the good stuff. Or, at least that’s what I keep telling myself. A few weeks ago, I decided to apply for benefits through Pacific Blue Cross. At first, I was mostly thinking about purchasing dental coverage. Having to fork out $600 for a dog-eaten retainer earlier this year was not exactly in the budget, and it opened my eyes to how costly life can be without a little coverage on your side. When I started thinking about some of the other benefits I could use in 2014, including vision care (I’m pretty sure I need glasses), prescriptions, etc. the quote was right so I went for the basics of it all.
I have yet to receive confirmation from PBC, but if all goes to plan I will be paying $41/month for health/prescription/dental coverage, as of January 1st. Immediately, I can start taking advantage of my prescription coverage (80%), which with one package of birth control will pay for itself each month (the prescription coverage costs only $10/month). I can also get my eyes checked finally! And in three months, I can visit my dentist for a much-needed cleaning (and probably an x-ray or two).
Note: I plan on keeping all of my receipts next year, and adding them up in December to see if purchasing benefits was actually worth it or not. I’ll keep you posted.
Cost: $17/month = $204/year
I don’t have much to say about why I purchased disability insurance, except that I did so at 11:34pm on a Thursday and it felt like the most grownup action of my entire life, lol. Again, it stemmed from a fear of living without any benefits or insurance policies to back me. I opted for a smaller insurance plan: my $17/month now means I could receive up to $1,500/month (47% of my monthly budget) if I was ever in a situation where I couldn’t work for an extended period of time. My (future) Emergency Fund would help fill the gap.
Note: Do I plan on cashing in on this insurance policy? Obviously not. But aren’t all insurance policies purchased for the “what ifs” in life?
Cost: $38.95/month = $467.40/year
Finally, just like the donations category had nothing to do with savings in my last post, tenant insurance has nothing to do with my health, but it has everything to do with my peace of mind.
I’ve purchased tenant insurance for every apartment I’ve ever lived in, but I haven’t had any since my move-out-of-the-creepy-apartment-and-in-with-a-roommate-and-back-out-on-my-own-again situation in September. This month, I shopped around until I found an insurance policy that included everything I wanted (earthquake, fire, contents of car, etc.) at a decent price. But holy cow, do I ever miss the cheap insurance prices (both car and tenant) that came with living in Victoria!
The first three categories were formerly employer-paid benefits that will cost me a total of $1,527 next year. BC MSP is a mandatory cost, so that can’t be avoided. The rest, however, is totally optional. Will the health benefits be worth it? Who knows. I did a few calculations, and I think the prescription and dental coverage will be worth it, but I’ll have to keep my receipts and see. I’ll probably assess the value in keeping these benefits in June, and then again at the end of the year.
Have these last two posts been overwhelming!? I honestly can’t believe how serious I got about my life and finances this month. It was sort of like a shopping spree, but for really important (/totally boring) stuff.
The one thing I can say for now is that my January budget is done and it balances, which is all I can really ask for!
Do you have health benefits through work? If you didn’t, would you purchase some?