If you are unable to continue working:
*A primary concern should be maintaining your health insurance coverage. Some companies offer short- or long-term disability insurance coverage.
*Look for alternate sources of income:
*Disability insurance, pension, individual retirement accounts (IRAs), keogh accounts,
personal savings, social security benefits and family resources are some possibilities
*Depending on your age, disability status and employment history, you could be
eligible for social security benefits, social security disability income, or supplemental
security income
Reducing or consolidating debt:
*The primary goal should be to reduce debt from your high interest obligations. The first step is to reduce high interest credit card balances or personal loans: pay off as much of the balance as possible, transfer remaining debt to a new credit card that offers a low introductory rate, and try negotiating extended fixed payments without increasing interest rates.
*Consider utilizing a credit counseling service for assistance.
*Ask creditors for a fixed nominal payment schedule.
*Filing for bankruptcy should always be a last resort, as it can impact future ability to secure credit.
Reducing federal income tax:
*If your symptoms meet the IRS definition of disability, you might be eligible for the Elderly and Permanently and Totally Disabled Tax Credit.
*Your medical expenses that exceed 7.5% of your adjusted gross income (AGI) are tax deductible, so you should keep an accurate record of all your expenditures. Expenses include diverse therapies, physicial and medication costs, travel for medical care, attendant care, home modifications required due to your medical condition, and forms of technology ranging from enlarged computer screens to voice activated software.
Tips for financial planning:
*Meet with your accountant or financial planner. Be honest about your financial situation and open to the options you will have to consider. Your goal should be living within your means.
*Consider using a standardized form to assess your current financial picture and to
predict your financial situation when you leave work, as well as farther into the future.
*Have a list of assets that could be tapped if necessary (i.e. the equity in your home).
*Come up with ways of increasing income, such as renting out a room in your house.
*Find ways to decrease monthly expenses.
Payout of pension and retirement savings:
*You may want to structure the use of funds such as retirement savings or pension payout based on your medical prognosis.
*If you have a stable prognosis and you forsee the need for long term income, consider purchasing a lifetime annuity to guarantee an income or a partial investment in an annuity.
*If you are diagnosed with chronic progressive MS and will likely need nursing home care in the future, you might consider spending down your assets to qualify for Medicaid.
*If you cannot work due to disability and you meet the IRS definition of being of long
and indefinite duration, the 10% penalty for withdrawing money from your employer's
retirement fund is waived. (This does not apply to personal IRA or Keogh.)
Small steps for saving money:
*Look through one of your credit statements for monthly fees you forgot about, such as
a gym membership or magazine subscription you don't use.
*Try to reduce credit card debt.
*If you often get stuck with late fees because your credit card bill is due before you get your paycheck, call and ask to have your due date changed (this could take a few months).
*Quit smoking (you save money on cigarettes, and health benefits could lower life insurance rates).
*Try using public transportation or carpooling more often.
*Have a budget when you go shopping. Use coupons, look for specials, try store brands, and stock up on the nonperishables when they are on sale.
*Replace your regular light bulbs with compact fluorescent bulbs. There is a higher purchase cost, but they last much longer and are more energy efficient.
*Buy things used instead of new when possible.
*Eat in more often.
*Borrow from a friend instead of buying when possible (e.g. books).
*Buy clothes in the off-season when they are on sale.
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