How Not Having Health Insurance Can Damage Your Credit

March 17th, 2017 | Author:

[F]or many, health insurance is a cost they can’t afford. Premiums have gone up and co-pays are often higher as well as deductibles. If you have decided that you just can’t have health insurance, be aware of what it may really cost you.

Major Health Issues

As long as you are healthy, not having health insurance may not be a big deal. However, one injury or serious illness can set you back thousands of dollars. For the average person, this may mean wiping out their savings. For others, it may mean accruing a bill they can’t afford to pay.

Just a few nights in the hospital or one surgery, and you could be thousands of dollars in debt. Even though many hospitals and clinics offer payment plans, you may have a hard time coming up with a minimum payment if your injury has resulted in time off work.

Collections Accounts

If you are unable to pay your medical bill, the clinic or facility will at some point send your account to a collections agency. The agency will try to collect on the money while reporting your nonpayment to at least one of the three credit bureaus.

Once you have a collections account added to your credit history, your credit score will drop dramatically. The better the credit score, the more it will drop. This information will stay on your credit report for up to seven years even if you start making payments or pay the balance in full. If you negotiate a settlement, it will show up as paid for less than the total amount.

Even though the effects of a negative account will lessen after two years, lenders will still see the account for as long as it is listed on the report. This information may deter them from approving a credit application.

While health insurance can be expensive, so is not having a policy in place if the time comes that you need it. Remember that the decisions you make now can impact your credit rating in the future.

Newest Answers

Big Changes Coming to Credit Reports

August 18th, 2017 | Author:

[I]f you have a bad credit score, you may benefit from the changes coming to credit reports soon. If you’re one of the lucky ones, you’ll see your credit score improve. In fact, it is expected that up to seven percent of those who have credit histories could see a benefit. What Changes Most civil […]

Continue Reading »

Be Realistic When Budgeting to Get Out of Debt

August 17th, 2017 | Author:

[Y]ou’re deep in debt and you want to pay it off to improve your credit score and to make life simpler. You want to pay it off as quickly as possible, which means making some major changes in your finances and life. Many experts tell you to stop spending any more money than you have […]

Continue Reading »

3 Ways You Can Waste Your Money

August 11th, 2017 | Author:

[I]f you’re trying to become more financially stable and improve your credit rating, you must be careful with how you spend your money. While you don’t want to give up everything fun in life in order to be frugal, you also want to avoid wasting your money on unnecessary expenses. Here are three ways people […]

Continue Reading »

Starting Over from Bad Credit

August 9th, 2017 | Author:

[Y]ou hit rock bottom with your credit. All of your accounts went to collections and your car was repossessed. You don’t even want to check your credit score because you know it’s bad. While the situation might seem hopeless, you can turn it around. Once you’ve lost any credit worthiness, you are ready to work […]

Continue Reading »

How to Talk to a Boyfriend/Girlfriend about Their Credit Rating

August 7th, 2017 | Author:

[I]f you’ve been dating someone for a while, you may be getting serious. Before you start dreaming about the perfect wedding day or what life will be like with 2.5 kids and a dog, you need to know you’re on the same page about important issues. While many people think nothing of talking about how […]

Continue Reading »

3 Ways Credit Matters to Everyone

August 4th, 2017 | Author:

[Y]ou pay everything with cash. Your motto is “If I can’t pay cash, I can’t afford it.” That means no credit ever. You may assume that you don’t need to worry about your credit score if you don’t plan to use credit to buy anything. Unfortunately, credit isn’t just about loans and credit cards. A […]

Continue Reading »

3 Tips to Help Your Kids When They Have Summer Jobs

August 2nd, 2017 | Author:

[I]f your kids are old enough to take on a summer job, now is a golden opportunity to teach them about money and finances. If you start them out right, they will know how to handle money and financial responsibility for when they are earning a full-time income. Here are three tips to use this […]

Continue Reading »