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How much emergency cash reserves to set aside?


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KMonde

I wanted to call this thread "How much to go naked?" It would have made for an eye-popping thread but didn't want to give the admins a heart attack.

I saw in one of the threads that some expats in the Phils. cover their health insurance out-of-pocket. I think someone called it "being naked" or "going naked."

Here's my question: If you're "going naked" for health insurance, can you share a ballpark figure of the amount of reserves to set aside, say for a married couple with no kids, age 65?

We're still in our late 50s but, for the sake of research, let's assume age 65. How did you arrive at your numbers? What assumptions were made? Is there a rule of thumb? Is there a range? Low/high estimate?

No idea how to estimate other than to assume $1,500 per month ($18k per year), which is what you might pay stateside for private health insurance before ACA came into fruition.

There are obviously other options for international health coverage other than going naked. Since some of you decided to go the naked route, it makes me think it has some merits which would be helpful to understand in how it compares to buying international health insurance coverage.

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I am not sure how many expats have the ability to set aside $20,000 US a year and still have enough left over to lead a quality life, just saying 

In my case I have about 500,000 set aside plus 3 western credit cards. But that's not how I really want to respond to you.  I been here at LINC for a few years now, and we see threads like this o

For we Aussies it's  'If in pain, catch a plane'!  Get to hell out of there to back home asap. I had to do this 11 years ago and still getting treatment constantly since, and all it has cost me was th

A_Simple_Man

This topic will involve a lot of personal opinion and anecdotal responces, I predict.  My own personal opinion is 1 million pesos in immediately available cash or borrowed funds will suffice.  Insurance or not, I have seen expats refused emergency treatment if they cannot put hundreds of thousands of peso into an up front payment.  Credit cards with that kind of credit limit will suffice.  Again, just my opinion and observations.  Also, this is Covid.  You'd be lucky to even get into a hospital.  Then there is inflation.  How much will you need 5 years from now?  Anybody's guess.

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KMonde

Agree, opinions will differ on this but we might arrive at a ballpark figure as more people chime in. I reckon if you set aside that amount every year and not touch it, just keep accumulating it, you will be ahead of inflation. Health insurance premiums don't accumulate. 

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KMonde

What I mean is set aside P1 million every year, so in 5 years you'll have P5 million and so on, instead of paying health insurance premiums which depletes every year whether you use it or not. That will have built-in inflation peotection in a way. Is that how you guys are doing it, or do you mean P1 million and P1 million only and not add to it every year. If so, do you also carry insurance in addition to reserves, like PhilHealth, Medicare A&B, or other policies?

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softail

I am not sure how many expats have the ability to set aside $20,000 US a year and still have enough left over to lead a quality life, just saying 

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KMonde

I get your point. Just trying to understand what others are doing. I asked this same question of my Filipino friends and the answer for the most part (from the middle class, not the elite who can afford to buy a whole hospital) is that they don't have reserves, they just "borrow from family and friends." I knew that having grown up in the Phils, but for expats that will not be the case. The emergency funds of P1 million I think most expats can cover, but beyond that, what do they do if they have catastrophic illness (open heart surgery, organ transplant, etc.), do they fly back to the US or do they have other arrangements for that?
 

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softail
22 minutes ago, KMonde said:

I get your point. Just trying to understand what others are doing. I asked this same question of my Filipino friends and the answer for the most part (from the middle class, not the elite who can afford to buy a whole hospital) is that they don't have reserves, they just "borrow from family and friends." I knew that having grown up in the Phils, but for expats that will not be the case. The emergency funds of P1 million I think most expats can cover, but beyond that, what do they do if they have catastrophic illness (open heart surgery, organ transplant, etc.), do they fly back to the US or do they have other arrangements for that?
 

I think that anyone contemplating moving to the Philippines should have that covered before moving. A responsible person should have been saving during there working years in preparation for there retirement years. 

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Soupeod
1 hour ago, KMonde said:

What I mean is set aside P1 million every year, so in 5 years you'll have P5 million and so on, instead of paying health insurance premiums which depletes every year whether you use it or not. That will have built-in inflation peotection in a way. Is that how you guys are doing it, or do you mean P1 million and P1 million only and not add to it every year. If so, do you also carry insurance in addition to reserves, like PhilHealth, Medicare A&B, or other policies?

First, as with anything in the Phil. Depends on your location.

Get Philhealth, 17k for a foreigner, cheaper for Filipino spouse. Two separate policys. Pays 25%, youll have to ask here for exact figures.

are you or your husband retired military? A lot of different options there. 
Is he VA disabled? Options there.

I live in the province, even though we have a hospital, it is like an army field hospital. If you need detailed treatment, get to Cebu, Tacloban, Iloilo, Manila, Subic and Clark.

I have 1 mil pesos set aside plus two credit cards, phil health and no extra saving per month. I also have Tricare and VA coverage. I prepay though because im not in a city with a Medical City hospital. Pay then get reimbursed. Medical city, I show my i.d. And we are done, pay the rest at discharge, with tricare. There might be other plans for you ask @Davaoeno for advice.

Went to the hospital emergency room here in June, total cost was 180k pesos, had to prepay half the bill in cash, no credit card taken until discharge. Different rules at different hospitals.

Big city stories - Research @Salty Dog story on what happen to him and @Headshot

That should get you started. 

43 minutes ago, KMonde said:

I get your point. Just trying to understand what others are doing. I asked this same question of my Filipino friends and the answer for the most part (from the middle class, not the elite who can afford to buy a whole hospital) is that they don't have reserves, they just "borrow from family and friends." I knew that having grown up in the Phils, but for expats that will not be the case. The emergency funds of P1 million I think most expats can cover, but beyond that, what do they do if they have catastrophic illness (open heart surgery, organ transplant, etc.), do they fly back to the US or do they have other arrangements for that?
 

Depends on location, here where i am in the province in leyte, they die.

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KMonde
51 minutes ago, softail said:

I think that anyone contemplating moving to the Philippines should have that covered before moving. A responsible person should have been saving during there working years in preparation for there retirement years. 

Thank you. This is why I'm researching now so we have coverage while there. Not comfy with cash reserves only. However, the locally available health insurance packages I've seen have age limits or exclusions for pre-existing conditions.

One thing you can say about insurance companies is that they're not stupid. They only want to cover young and healthy people. What's the point of having that policy if it won't cover you when you're old and sick. So local companies are out because of those two things (age limit & pre-existing conditions).

Looking at international policies, I've only seen one with no age limit (CIGNA). There might be others, I haven't really looked in earnest yet. Please suggest if you know a company that might fit what I'm looking for.

I know enough to get PhilHealth. That's a must. First on my list to get. For emergencies, yes, we all agree we must have enough cash reserves accessible immediately in your person, in your condo, credit card, or trusted someone if you're unconscious. Amounts may vary but P1 million seems a good cushion. 

But I still feel a need for something in addition to all of the above. No VA for us; we're not affiliated with the military. Medicare A&B we will likely get even if we can't use it in the Phils. Kind of a backup insurance. So what do people do in the same situation as us? Get Cigna or similar? We are still young and healthy, but what happens when you get sickly. Can they decide not to renew you? In which case you would have been better off saving the premiums and adding that to your reserves every year.

This health insurance question is a big obstacle to expats moving there. I wish the Phil Retirement Authority comes up with a health program that retirees can buy into, like a pooled insurance.

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A_Simple_Man
1 hour ago, KMonde said:

This health insurance question is a big obstacle

When you live in the Philippines you will eventually have a hospital of choice, somewhere near you. For me it was the Silliman Medical Center in Dumaguete.  When one of my friends died in that hospital I was nominated to go to the hospital financial officer and explain how he died without enough money to pay his bill.  The financial officer was not happy and explained that was why they usually make foreigners pay a large portion in advance but Tom did not have to pay in advance because his friends vouched for him.  Then his friends all disappeared when he died and left a bill to be paid (happens all the time, seriously).

Anyway, I had a talk with that finance officer about how foreigners could avoid that problem and I was told that each hospital had an insurance company that they prefer to deal with.  If you ask at the hospital which insurance they prefer you to have then you will get preferential treatment when you need the services of that hospital.   As I recall, it was going to cost me 50K pesos a year and I chose not to . . but that option is there.

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Fresh
1 hour ago, KMonde said:

I know enough to get PhilHealth. That's a must.

Why is it a must? PhilHealth has limited coverage up to a certain amount. It's good for the average Filipino because they generally won't be going over those amounts. It's not good for the wealthy, because they may.

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KMonde

It's a supplement to whatever patchwork of coverage I can cobble together. In the provinces, having PhilHealth will get you in the hospital faster. Hospital admission understands PhilHealth.

 

34 minutes ago, A_Simple_Man said:

When you live in the Philippines you will eventually have a hospital of choice, somewhere near you. For me it was the Silliman Medical Center in Dumaguete.  When one of my friends died in that hospital I was nominated to go to the hospital financial officer and explain how he died without enough money to pay his bill.  The financial officer was not happy and explained that was why they usually make foreigners pay a large portion in advance but Tom did not have to pay in advance because his friends vouched for him.  Then his friends all disappeared when he died and left a bill to be paid (happens all the time, seriously).

Anyway, I had a talk with that finance officer about how foreigners could avoid that problem and I was told that each hospital had an insurance company that they prefer to deal with.  If you ask at the hospital which insurance they prefer you to have then you will get preferential treatment when you need the services of that hospital.   As I recall, it was going to cost me 50K pesos a year and I chose not to . . but that option is there.

That must have been a really difficult conversation. Sad about the friends that disappeared. Thanks for at least showing up there to explain.

Good info about a hospital's preferred insurance. I assume local insurance. I have friends who are agents of some of these insurance products who were upfront about the age limit. I suppose I could use their product til age 70 and then after that just pay out of pocket. They're not bad products. Not cheap either. One was US$6,000 a year but covers all critical illness (except Covid, a friend found out when he got Covid, because it's too new and not included in the policy yet). It's like a hybrid investment + life insurance + health insurance. I don't know of a similar product here in the US. Maybe an annuity or a reverse life insurance like a reverse mortgage. The more complicated it is, the less I trust it.

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to_dave007

In my case I have about 500,000 set aside plus 3 western credit cards.

But that's not how I really want to respond to you.  I been here at LINC for a few years now, and we see threads like this one from time to time.  You are not the first to ask these questions.  And I feel like you aren't really asking the full complete question that's on your mind.  We all know that health care here in PI is NOT what you might be used to back in your home country.  And we all know that there is some medical risk in coming here..  especially as we get older.  You are uin your late 50's now..  but you specifically ask the question as if in mid 60's. (not even thinking about mid 70's and mid 80's).  So.. you know there is some risk you are taking on here.  And it feels to me that you are asking "How much money should I have to eliminate the risk in coming here".

And my answer is.. You can't eliminate the risk.  As @Soupeod suggests above..  you can get PhilHealth.. credit cards and maintain a cash balance..  But if you have a heart attack while in the province far from a major hospital..  or if you get seriously ill in Cebu City when the hospitals are overflowing with COVID patients.. you may very well die.  A death that was PREVENTABLE in Miami or Berlin or Hong Kong..  may not be preventable here.

And if you really don't want to face that risk..  no amount of cash in the bank is enough.      

We all gonna die one day.

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Dafey

I have lived a full life and done and seen more than most men half my age. If the big one comes so be it...there is no way I can afford insurance in the US so no matter what the situation I am better off here.

Get what you can, while you can to cover yourself in the future and that's the best you can do.

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Ozepete

For we Aussies it's  'If in pain, catch a plane'!  Get to hell out of there to back home asap. I had to do this 11 years ago and still getting treatment constantly since, and all it has cost me was the fare back home and nothing since for treatments / hospitalisations. If I had stayed in the Phils I would be long gone and if not, certainly broke!

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