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

Common Myths on Building Credit

October 21st, 2017 | Author:
h

If you are just starting out on your own, you may have a hard time getting credit cards or loans because of a lack of credit history. You must build credit to get access to the best credit cards and loans, but you can mess things up if you don’t know how to do it […]

Continue Reading »

3 Things to Do When You Know You Can’t Pay a Bill

October 20th, 2017 | Author:
h

One of the worst feelings you can have is when you have a bill coming due and no way to pay it. You have either spent all of the money or you have to spend it on something more important. You don’t want to have to deal with those phone calls from creditors because you […]

Continue Reading »

Why You Should Change the Due Dates on Your Bills

October 11th, 2017 | Author:
h

[Y]ou open up the credit card statement only to see another $30 late payment fee assessed. Ugh! You can’t believe you forgot to make a payment on time again. In between running the kids to daycare or school, meeting with clients and taking care of errands on the weekends, some things just get pushed aside. […]

Continue Reading »

Good and Bad Reasons to Have a Credit Card

October 10th, 2017 | Author:
h

[G]etting approved for a credit card is a sign of responsibility. It can give you freedom with your finances. For instance, you can book a hotel or buy airline tickets, which would be difficult without a card. You should know why you want a credit card and understand if those reasons are good or bad. […]

Continue Reading »

Should You Avoid All Debt?

October 6th, 2017 | Author:
h

You hear financial experts preach about getting out of debt. They tell you to cut up your credit cards and pay for everything with cash. While some people may need to follow this advice, you may wonder if it’s the case for everyone. Should you avoid ever having any kind of debt again? Not Avoidable […]

Continue Reading »

Why Fall is a Good Time to Learn to Save Money

October 2nd, 2017 | Author:
h

[T]he busy summer season is behind everyone, and the upcoming holiday season is a few weeks away yet. Now is the time to focus on goals you have set. One of the most important is saving money. Fall = Transition Time You are transitioning from the lazy days of summer, times when you spent a […]

Continue Reading »

How to Protect Your Identity at Home

September 27th, 2017 | Author:
h

[W]hen you hear about identity theft, you may think about all of the public computers in use as well as the credit card machines in stores. While these are all areas that are vulnerable to hackers and those who want to steal your identity, one of the most dangerous areas is at home. Why? Because […]

Continue Reading »