She Got Hit With a $9K Medical Bill. Here’s How She’s Fixing Her Finances

woman using calculator to budget finances at home
gece33/Getty Images
Honest Abe

Disclosure:

Some of the links in this post are from our sponsors. We’re letting you know because it’s what Honest Abe would do. After all, he is on our favorite coin.

I love deadlines, which is a good thing, since earning a living as a writer pretty much depends on nailing them.

The best kind of deadlines for me are ones the same length as my attention span — short.

With the end of the year right around the corner, I decided to challenge myself by creating a goal with a built-in short deadline.

I’m going to fix my finances by January 1st.

The past year has been good to me in many ways, except one. I racked up $9,000 in medical bills my insurance doesn’t cover.

I certainly wasn’t expecting such a huge expense this year, so it wasn’t in my budget.

My finances have been in a bit of a tailspin ever since, so here’s what I did to get things back under control before ringing in the new year:

1. Got a Free Credit Report

I paid my $9,000 medical bill with a credit card, so the first thing I needed to know is how it affected my credit score.

Credit Sesame hooked me up with a free copy of my credit report that included my credit score, plus a whole lot more. It also showed me how I use my credit, how long my credit accounts have been open and my payment history, so I can see exactly how much money I owe and to whom.

I know errors on my credit report can mess up my credit score, so I checked my report to make sure everything was correct.

Everything looks fine but, just to be safe, I asked Credit Sesame to alert me by email or text if someone tries to apply for credit in my name.  

2. Arranged an Automated Investment Plan

The reason I had to pay my medical bill with a credit card is because I didn’t have $9,000 in my emergency fund. (Does anyone have that kind of cash lying around these days?).

It really drove home the point that I need to come up with a better long-term savings strategy, so I downloaded Stash to help me set up an automatic investment plan.

It’s an easy-to-use investing app that lets you dictate what types of companies you choose to invest your money in. It lets you start investing with as little as $5 and for just a $1 monthly fee for balances under $5,000. (The first month is free.)

I set the app to automatically withdraw a certain amount of cash from my bank account as often as I’d like — from once a week to once a month (I chose to have it withdraw $10 every two weeks).

3. Canceled Unwanted Subscriptions

While trying to get my finances back on track, the last thing I need are recurring fees for subscriptions for things I don’t even want.

We all sign up for stuff. Sometimes it’s easier to put subscriptions on a recurring payment and forget about it — looking at you, Netflix.

I used Trim to figure out if I was spending needless money on repeating charges. The bot analyzed my account for recurring subscriptions and offered to cancel any I didn’t want.

I didn’t even have to pick up the phone to part ways with the streaming-music service I no longer wanted. How easy is that?

4. Got a 401(k) Analysis

I sock away money into my 401(k) each month, but I admit I don’t know if my retirement plan is working to its full potential.

So I turned to Blooom for a free 401(k) analysis to uncover hidden fees and help me understand my investments.

I was surprised (and a little dismayed) to discover I have the wrong mix of stocks and bonds to retire when I plan to. I also found out my investments aren’t as diversified as they could be.

On the plus side, I’ve only paid about $4 in hidden fees this year.

Based on Blooom’s advice, I changed some investment allocations in my 401(k) to build up my retirement fund even faster. For $10 a month, Blooom will keep your account optimized for you.

I won’t climb out of $9,000 worth of debt over night, but these four pieces of financial advice helped me set a shorter deadline for paying it off with the money I save.

Challenge accepted.

Lisa McGreevy is a staff writer at The Penny Hoarder. She likes short deadlines followed by long naps.

Do you think this article might help you put more money in your pocket?

Honest Abe

Disclosure:

Some of the links in this post are from our sponsors. We’re letting you know because it’s what Honest Abe would do. After all, he is on our favorite coin.