In my last article I wrote about the 37% increase we are facing if we maintain our current health insurance coverage in the States. Since retiring last summer we have relocated our stateside residence from from California to the state of Washingtion where we have a comfortable 40′ fifth wheel parked on my brother’s property in Newport.
However we have been in San Felipe since the first of the year and are considering remaining here through the summer. With that in mind we are also exploring our options for health insurance here in Mexico. I have been corresponding with an agent for the last week and was originally quoted a cost of about $3900 annually but their system was undergoing revision over the weekend and when it was completed the cost had jumped to $4800.
Obviously Mexico too is impacted by inflation in medical costs however, this still pencils out to only $425 month for the both of us which is half of what we have been paying. The coverage is quite comprehensive and includes a private room if we require hospitalization. The deductible is about $600 or $700 per illness and this does not cover office visits but does cover surgeons, anesthesiologists, medication etc.
I have talked to many Americans currently living here in Mexico and so far I have heard nothing but good about the local doctors and the care they have received here in town but I have not encountered anyone who has been hospitalized in Mexicali (there is no hospital in San Felipe anymore).
We will be doing more research before deciding whether to drop our Blue Shield policy or not.
In the meantime, I came across this interesting video on one health care organization that operates here in Mexico.
I am a non-polical person. I do my best to avoid the debates between parties and I don’t believe someone like myself who is not actively partiscipating in the struggle to change the system has a right to bad mouth the efforts of those who are devoting their lives to working for change. So up til now I have kept quiet about the health care bill. However this week the health care issue has struck close to home. My husband and I received news that our current health insurance program is looking at a rate increase of 37%. This jump will take our monthly insurance premium from $843 to over $1000. As a result our reps are looking for alternative coverages and we are looking to obtaining medical care in Mexico instead of the States.
How else can retired people afford these can of increases? Our retirement income has a cost of living increase built in… I think it is 2%. That certainly isn’t going to cover even the raising cost of food, nevermind this insurance jump.
What I don’t understand is where this money goes to. I look at the statements I get showing how much my doctor receives and the amount the insurance pays her isn’t going up, sometimes it is going down. So where is the increase going?
Through the course of my 60 plus years I have experienced various degrees of affluence. There were years when I was broke and years when I was blessed with a good income. I don’t think I was ever poor or rich, always somewhere in the middle. During my broke periods I learned some habits that stayed with me even in the more affluent years.
Don’t Shop
I make a great effort to not shop for entertainment. One of the biggest drains on our budget is cruising Costco because we are bored.
I don’t read catalogs, they go directly in the trash or in a drawer for future reference.
I pre-record shows and skip the commercials, if they are not recorded I will pause them until I have enough time built up to skip past the commercial. I use to consider satellite or cable a luxury but this ability to live without commercials has put it closer to a necessity for me. Commercials are designed to get you thinking you need something that you don’t.
When I need clothes for a trip or special event, I shop discount stores. I have found most of my nicer evening ware and even my “mother of the bride” dress at Ross for a fraction of the cost others spend.
I love yard sales. There was a time I spent foolishly at yard sales and accumulated a lot of junk but I finally learned to “shop” them for items I was in need of, instead of just buying things because they were such a good price. I have however been known to make a healthy profit on some items I bought a yard sale and turned around on Ebay.
Trade books with friends. With paperbacks starting at $6-10 dollars my reading habit could put a big dent in the budget. This is one of the reasons I have stayed clear of the digital readers (until recently). Ebooks cost nearly as much as a paper book and prior to the Nook, you could not share them with your friends and family. I think they still limit the sharing too much but at least it’s a start.
Shop Prices Not Stores
If your cell phone breaks, research models online before you head for the cell phone provider.
Decide which features are important for your lifestyle and which you can live without.
Once you pick a model, check the price on Ebay before heading to the store. Granted your cell company may offer you the phone “free” or at least discount it drastically, but accepting such a deal will most likely lock you into a one or two year contract. Be sure that’s where you want to be before committing.
Don’t Buy New When Will Used Do?
Many items we buy drop in value drastically when they leave the showroom or storefront. Is that new car or washer/dryer combo really worth that much more than the year old model? I’ve traveled both sides of this road and found that my “brand new” Maytag washer and dryer gave me less years of service than the used sets I bought through the classifies or at a yard sale. The used appliances were bought at about 1/6th of the price of the new model. The new washer lasted two weeks past the extended maintenance contract (which cost more than the used appliances). Overall the used appliances I have purchased have lasted 3 to 4 years minimum. Do the math yourself. $1800 for 5 years or $300 for 4 years.
Don’t Buy to Impress
I have known folks that insist on buying Designer Labels or lookalikes because they are concerned with their image. A purse is a container for carting your stuff around. If it is sturdy and attractive, what difference does it make what the name on the label says? Is it lighter or more comfortable on your shoulder? Will the contents fall out when you lay it down? Get real. Buy what you need and forget the image thing.
I should have perhaps titled this article my pet peeves about shopping. I realize that this may be more my personal opinion than sage advise. Take it or leave it, your choice.
As a new grandparent (for the 2nd time), I was thinking this morning about how things have changed since I raised my daughter. When my daughter was young the new innovations available were microwave ovens and VHS players. My grandson turned eighteen on his last birthday. I remember watching in wonderment as he whizzed around my Window 3.2 and found his kids programs at the age of four.
Now days we can do more on our phones than was possible on the mammoth main frames I started my computer career on. So the question is, how does this change the challenges faced by new parents?
Some things change very little, unlike a newborn’s diapers, which seem to need changing several times an hour. Many new parents still face the same questions we did. Is it better to breast-feed or bottle feed? Are cloth diapers better than disposable? What kind of food should I start my child on and when should they start solids?
Admittedly, having only raised one child, I am no expert on the subject but I will gladly share what I learned or believe to be true.
Breast or Bottle?
I am big fan of breast-feeding children for as long as possible (within reason). I know this is a tough one as most mothers these days have to go back to work and pumping and storing breast milk it a real pain. Yet, I think it is worth the hassle to keep the child on breast milk for at least the first 6 months. My opinion, take or leave it. Not only does it provide the best nutrition possible for the baby but it is also a budget bonus as breast milk does not cost you a cent!
Disposable versus cloth diapers… is this question even raised these days? Maybe not. I found a somewhat recent study that proposes that there is no significant difference in the environmental impact when you take into consideration the cost of laundering and water usage etc.
A new study released in England by a quasi-government environmental organization may dampen the debate even further. After a three-year, 200,000-pound (about $360,000) study, the London-based Environmental Agency concluded that disposable diapers have the same environmental impact as reusable diapers when the effect of laundering cloth diapers is taken into account. ABC News May 2005
Other writers however point out that over a ton of soiled disposal diapers will go into the land fill over the course of one child’s life. Cloth diapers have come a long way since my day too. They now come in colorful designs and adjustable sizes that grow with your child. One source (see video below) says that these grow-with diapers could bring the cost of your child’s diapers down to about $500, where as the buying different size diapers could cost over $1000. Yet when you compare that to $3500 for the disposable kind, it is still a significant savings.
Baby Food or Not?
Another area where new parents can save money is by making their own baby food instead of buying pre-made bottled foods. This practice has become even easier with the advent of convenient mini-blenders like the Magic Bullet. I guess this is an area where mom and dad’s schedules have to be taken into consideration. It is one thing to prepare fresh meals when you are at home but the jars are convenient when you have to pack the baby’s food to go to the sitter. Then again, they also make convenient plastic storage containers that you can puree up last night’s veggies (before seasoning) to send off with baby the next day. I haven’t shopped for baby food recently but I’m betting the cost has skyrocketed like every thing else.
This is one lesson that I did not put into practice and lived to regret. When I was young, I lived my life as if there would be no tomorrow. I certainly did not give any thought to what I would live on when I retired. I must admit, I couldn’t imagine living long enough to retire when I was in my teens and twenties.
My thirties were VERY lean years and our idea of saving money was tossing our pennies into a jar. In spite of this, or perhaps because of this, I tried desperately to teach my daughter and grandson the practice of “paying themselves first” by putting a small percentage of their earnings into a savings account before they spent money on anything else. I wasn’t a very successful teacher either. At least not with this concept.
So here I am again, trying to share this you my readers. Run the figures for yourselves. If you put $275 a month away for 10 years you will have “saved” $33,000. If you did not deposit another dime and just let that money sit for 20 years and collect interest. At 8% interest, you would more than triple your money, and end up with a little over $112,000 . If you waited ten years to start saving, the same amount ($275/month) you would have $50,000 less 20 years later (assuming you earned the 8% interest).
If you have never saved money, start small and increase the amount you are saving each time you get a raise. Although I didn’t start until my 40s, I did eventually learned to put the biggest part of each pay increase I received into savings or an IRA.
Another tactic is to save part of those birthday checks from grandma or your tax refunds and don’t forget the pocket change… it adds up. We picked up a change sorter and put our “savings” into a special vacation fund but it would have been even better if we had put half of those “bonus pots” into a savings for 20 years. Now that would have made for really nice vacation fund for our golden years.
