Welcome back to the debt free journey series. This is part five, but don’t forget to check out part four of the series. It wouldn’t be right to wrap up this debt free journey series without talking adding additional debt while on a debt free journey. Unfortunately, this is the reality of our situation. Medical bills have added over $11,000 in additional debt for us the past year.
You may be asking why we chose not to use our emergency fund or sinking funds for these medical bills. The short answer is that it would not have made a difference. If you have followed my husband’s Chiari Malformation story, you know that things happened suddenly. We were not prepared for a medical emergency of this magnitude. Our budget allowed for a few sinking funds, but none of them were for medical issues. We quickly found out that everyone is healthy until they’re not. Our emergency fund was $1,500 at the time. Using the emergency fund towards these bills would have left us with no cushion and we would still owe $10,000 in additional debt.
The first couple of doctor’s visits were covered with cash, but when we reached more than five visits within the same month we could no longer afford to pay up front. My husband was not able to work and we still had to be able to live and eat. The good thing in this whole situation was both of our cars being paid in full before this happened. We would not have been able to survive with two car payments and about a 60% loss in income.
Throughout this year of surgeries and MRIs, we have spent about $200 from our emergency fund that we still need to replace. Bills are constantly being sent to collections, but what can we do if we can’t afford to pay them at the moment? The medical category in our budget gets $50 per month and I send this $50 to the smallest medical bill for that month. I choose not to call and get payment plans because we cannot afford them. We owe well over 20 different places. A payment plan with each company would be more than our income per month. I also choose not to consolidate because I would rather pay the bills off smallest to largest than pay towards a huge $10,000 bill. I enjoy the feeling of sending in the last payment to each company.
We have every intention of paying all of the medical bills, but this will take time. Our current plans do not include purchasing a home or car so the credit score does not bother us. There is actually only one loan with a balance of $360 to finish paying before we reach the additional debt in our snowball. This should happen within the next two months.
We are not discouraged, and we know that we will eventually have these bills paid off. I have mentioned all of this to stress that uncontrollable things WILL happen throughout this journey. The major takeaway is to keep going. Do not stop when things are not going according to plan. Sometimes you have to roll with the punches.
If you find yourself in the uncomfortable situation of adding debt while attempting to pay down your debt, do not panic. Sit down and evaluate everything that you are paying for and make cuts appropriately. It will be hard for a while, but things will get better. Prepare for the future by creating sinking funds to pull from in addition to your emergency fund. Everything will work out in the end.