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If there’s one thing more certain in life than death and taxes, it’s unexpected medical bills. As we age, we become more at risk for physical ailments, some of these not so serious like a broken bone. Other’s very serious, and even life-threatening heart disease and certain cancers. 

All too often, those folks who’ve retired just don’t have the money to pay for unexpected out-of-pocket medical expenses. When that happens, entire life savings can be depleted. Fortunately, there is one remedy for this potentially dire situation. It’s called a reverse mortgage. 

Designed for people 62 years and older, a reverse mortgage allows long-time homeowners to tap into their equity to receive either monthly payments or one large lump sum. The beauty of this loan is that you never have to pay another mortgage payment again. The loan doesn’t have to be paid back until the borrower dies or leaves the house. What’s more, you can use these proceeds to pay for unexpected medical bills while leaving your hard-earned savings untouched. 

To figure out how much of a reverse mortgage you might qualify for, you can use this handy reverse mortgage calculator created by All Reverse Mortgage.

But what can you do to prevent the threat of draining your savings on out-of-pocket medical bills before an unexpected medical condition occurs? According to a new report, it doesn’t take a whole lot to destroy years of retirement planning. An unexpected illness or accident that occurs near retirement can result in financial disaster when it comes to out-of-pocket expenses.     

Says certified financial planner Stacy Francis, the number one reason people file for bankruptcy in their retirement years is medical-related expenses. If you’re not prepared, you could be placing yourself and your loved ones in a disastrous situation of having to max out credit cards and/or draining your retirement account. 

That clearly in mind, here are three ways to plan for the unexpected medical bills that could come your way in retirement. 

Health Savings Accounts

Prior to retirement, you can open a health savings account (HSA) which can be used for out-of-pocket medical expenses while you still have a job, and for unexpected expenses during retirement. The cash you place into these accounts come with tax advantages since it reduces your taxable income. The money you save grows tax free and likewise it can be withdrawn tax free when utilized for qualified medical expenses. 

Up until recently the government allowed you to contribute up to approximately $3500 in a HAS if you file taxes as a single individual, and close to $7,000 for a married couple with kids. 

Build Up Your Emergency Savings Account

It’s a fact that well over half of America’s population doesn’t have more than $500 in savings. This means they are living paycheck to paycheck. Some of the people who appear to be wealthy, with big homes and nice vehicles parked in the driveway, are living not on cash, but debt. Instead of spending all your money on frivolous goods, you need to build up your emergency savings account so you have, at minimum, six months of living expenses for your “rainy day” cash fund. 

Saving this kind of money is easier than you might imagine. Start small and build it up weekly, bi-weekly, or monthly depending upon how often you get paid. Begin by stashing away just one percent of your pay, then five percent, and then 10 percent. 

You might also want to consider putting some of your savings into crypto currencies like Bitcoin which, since 2012, has realized 200 percent average annual growth. 

Insure Your Savings  

In order to protect your savings accounts should you suffer a serious injury or illness that leaves you unable to work or that occurs in retirement, you must make certain you have access to disability insurance. 

BenefitsPro.com recently conducted a survey in which they discovered barely one-third of all Americans carry a disability insurance policy at present. Most disability policies that you can acquire via your employer will cover approximately 40 percent to 60 percent of your annual take-home pay. Disability Insurance will provide steady payments if you can no longer work. More importantly, it keeps you from having to dip into your retirement fund.   

When you consider how much time you spend looking into your retirement portfolio or how you would never consider driving without auto insurance, you must come to realize that disability insurance is just as important. You should also know that if you have no choice but to take money from your retirement account to pay for medical expenses, the IRS will consider it a taxable event.