Planning on dropping Health Insurance. Change my mind.

[4570Man]

I don’t know where the rental property came into play, but I’d advise against that. I’d also advise against renting low end property’s. Those attract the “highest” class citizens that cause the most problems. If you do continue NEVER leave the utilities in your name, don’t take a sad story for lack of rent and never let rent go more than one month behind. They almost never dig out of a hole that deep and by the 3rd month it’s pretty much a certainty you’ll be stuck with the tab. Probably the worst of it all is the courts side with these losers and it’s a time consuming and expensive process to evict them.

 

[BrokeFarmerJohn]

Here's what I read, "When I laid my bike down the bill was around 10k, I paid $1800 of that out of pocket on my current plan. Plus $200 ER visit Co-Pay and prob other expenses I’m forgetting. That was the only time I used the insurance that year."

So I take the $10,000 and subtract $1800 = $8,200 insurance covered. Divide that by the $185 p/mo you mentioned you paid = 44.3 months of payments, or 3.7 years.

So your one road rash incident with no major damage to your body absorbed over 44 months of the payments you made. I think you said you been employed there for 6 years. If so, that one incident took health premiums for over half of the time you been employed there.

Not having health insurance will jeopardize all your goals. Oh, and sell the tractor. You already said you don't need it, and get your 401K replenished.

Sell the tractor , that’s blasphemy!!! Lol, I thought about it but I can’t part with the tractor, it’s too handy not to own. It will be paid off in another 3-4 years.

Idk when but at some point I wrote out, the first year I did the max plan, second year the middle plan and last two years the lowest plan. Total was around 14k give or take as insurance was lower 4 years ago vs 2018 rates.

But I do get what you are saying. I was shocked what a few scans cost.

 

[BrokeFarmerJohn]

Why the rush to pay off the home loan? It’s probably your largest tax write off.

Here is my last six months of using medical insurance.

Driving to work and some a hole runs a light and t bones me totaling my car...dr visits the whole thing.

A few months ago my wife was riding her horse, got thrown and messed up her eye. This Thursday she is having surgery to permanently remove the eye. This...and two or three other surgeries. She is well into the 200k range...so far. Probably 500k by the time all the bills trickle in.

It seems like you are working hard saving financially...if you drop your insurance and some a hole t bones you...all of your hard work could be lost.

Not worth it.

Sorry to hear about you and your wife’s misfortunes.

There is another post a few up from this one, the story of my dad being horrible with finances and end up walking away from the house I grew up in soon after my parents got divorced, Idk that story scares me to the point I want to pay the house off as soon as I can so I don’t have to stress about losing it.

Besides that, the final pay out on a 15 year mortgage vs a 30 is like 80k less! I couldn’t swing a 15 and had to do a 20 year but have always paid $100 extra towards principle every month which shaves off a few more years.

My interest is 3.75% so the tax deduction isn’t that substantial for me, plus I’m a single male come tax time so I get hit pretty hard. I hear that will go away in 2019? But not sure.

 

[goeduck]

The Pink Elephant in the room is that none of this needs to be so high priced. They do it because they can. No one challenges them. No one says no, you can't charge $10 for a single aspirin.

My wifes medical bills last year ran around $400,000. We paid $1733 deductible. Interesting, however was that her insurance only paid about $110,000 to settle up with the hospital, somewhere in the 25% range. But if we did not have insurance, we would owe the $400,000. Go figure.

So the OPs $2200 insurance cost is a bargain.

 

[4570Man]

You’re right that a 15 year mortgage end payout is way less than a 30 year. I can understand keeping the tractor, but why not go with a more budget oriented series? Ever thought about picking up a side job? Offsite insurance and liability insurance for your tractor isn’t a lot of money so you could work it with minimal risk. The insurance my backhoe comes to about 35 years of not getting stolen or burning down to break even. It’s really longer than that since the insurance cost is directly proportional to the insured valve and the value will go down over time. The liability insurance was cheaper than expected at about $200 a year for 1million umbrella 1k deductible.

 

[BrokeFarmerJohn]

I don’t know where the rental property came into play, but I’d advise against that. I’d also advise against renting low end property’s. Those attract the “highest” class citizens that cause the most problems. If you do continue NEVER leave the utilities in your name, don’t take a sad story for lack of rent and never let rent go more than one month behind. They almost never dig out of a hole that deep and by the 3rd month it’s pretty much a certainty you’ll be stuck with the tab. Probably the worst of it all is the courts side with these losers and it’s a time consuming and expensive process to evict them.

Owning a bunch of rentals seems like fun. Maybe if I got enough I could quit my job and just manage the rentals.

My background is HVAC, that’s what I went to vocational school for and was in the trade a few years, I left that for guaranteed 40h work weeks and a little more money as a maintenance man for a low income housing apartment complex, there was two men on site 8-4:30pm M-F, that quickly turned to just me due to budget cuts. So I was the only maintenance guy for 120 units ranging from 1200-1400sq ft each. I was only there 5 months but learned A Lot. So I can do anything to do with rentals myself, except roofing, don’t do that. Repairing appliances to drywall to installing a new A/C and furnance, I have the tools for and can do.

I guess I always wanted to get into real estate but as a owner/buyer, not a seller.

But I don’t know anything about rentals, but not
There anyway.

I didn’t plan to buy a run down place in a bad part of town. I planned to buy a condo, something easy to sent out due to its size and cheaper rent, in a nice neighborhood of about 30% home owner 70% renters. (Read that online one day, the guy said to stay away from neighborhoods with home owners greater than 40%, they are nicer, better taken care of areas but not as much money in the investment).

 

[4570Man]

I’ve pretty much sworn off ever owing a rent house. I’ve seen it go down and that’s not my idea of fun. Renting nicer places is less headache. The second problem is if I owed a rent house it would put a real drain on my flip house money. Even at the snails pace of 1 house every 1.5 years I get a lot better rate of return doing that vs what renting pays. If I was working at that full time which I don’t I could shorten the 1.5 years to a few months. At least the snails pace avoids short term capital gains tax.

 

[ultrarunner]

A few comments from the trenches...

First... Insurance originally was to make the unbearable bearable... of course there are many levels of insurance and what some call insurance today is more like a HMO... where preventative measures and wellness comes into play.

Way back when... Hospital Plans made the biggest inroads... so if you were hospitalized the bills were manageable...

The question is what do you have to loose is often the place to start...

We serve those with unbelievable plans where everything is covered... mostly civil services, utilities... politicians and some of the old Union Plans were pretty amazing...

We also serve those with nothing... case in point.

A 15 year old girl gave birth to a child with a severe heart defect requiring several surgeries and NICU...

The 15 year old had nothing as a minor... her 29 year old mother was on Section 8... so nothing there either...

The infant had over a million dollars of care... most at Stanford with family stays at Ronald McDonald house... and this was 20 years ago... when a million was really a million. Finest medical care on the planet totally without cost.

I see similar all the time on a smaller scale...

The problem is that most on TBN own things... we have mortgages, expenses, dependents, etc... without insurance the alternative is bankruptcy... and to a lesser extent care...

There was a famous case where a man needed lifesaving surgery robbed a bank so that he would become a ward or the State for his medical care...

Interesting how that work... California prisons pay for sex reassignment surgeries etc...

Just something to think about...

 

[BrokeFarmerJohn]

You’re right that a 15 year mortgage end payout is way less than a 30 year. I can understand keeping the tractor, but why not go with a more budget oriented series? Ever thought about picking up a side job? Offsite insurance and liability insurance for your tractor isn’t a lot of money so you could work it with minimal risk. The insurance my backhoe comes to about 35 years of not getting stolen or burning down to break even. It’s really longer than that since the insurance cost is directly proportional to the insured valve and the value will go down over time. The liability insurance was cheaper than expected at about $200 a year for 1million umbrella 1k deductible.

I thought about putting the tractor to work with side jobs, I got into hay this past spring, racked up 20+ hours on the machine cutting and raking hay but my buddy and I got out of hay.

For a long time I was very aggressive with “Hobby’s”. When I bought my house I soon gin chickens, lots of chickens lol, I had 80 at one time, I planned to sell eggs, I soon found out that people fight you on every little detail like price and the color of the egg, it got to the point I was putting too much time into the chickens so I gave up on selling eggs. Then I got into cattle, bought a steer, then another steer and bull. Then I installed 470ft of fence, set my property up for cattle, fed by square bales and stashed 75 squares up in the loft. Figured out I could buy cheaper hay if I fed round bales and I wouldn’t have to toss bales around so I went shopping for a tractor, found a good deal on the tractor I have and set myself up for round bales.

Now that I was feeding round bales I needed a bigger truck to haul them with so I bought a 90 F350 5-steed with 351v8 for $950, put around $300 into it and 3 weekends, made it mechanically sound and decided I wanted a automatic the next year. Sold the SRW F350 for $2200 and bought a DRW 95 F350 with the 460 v8 for $1800. It’s been a good truck so far.

I got a great deal on a lawn mower, bought the Husqvarna for $800, used it for a year and half, sold it for $1100 and bought a $1800 2 year old Husqvarna, snatched a 99 JD 455 with 60in deck for $2300 and sold the Husqvarna for $2000 to a neighbor. Then started buying and selling JD 300 series mowers.

Bought a JD 318 with 3pt for $1450, sold it for $2550 after delivery with a rear blade I gave $250 for. Bought another non running 318 with a 3pt tiller and hydraulic front blade for $1200, gave a buddy a **** of a deal on the tiller at $400 (they go up to $1100, mostly around $800), sold the tractor for $600 and waited to sell the blade in the fall, I’ll get $300-$400 out of that, if I didn’t give the buddy the deal I could have easily doubled my money on that one. I have a 332 in the garage now 16hp yanmar diesel version of the 318, that one I’m selling as a complete project, will prob only make $200 of it unless I restore it.

I buy and sell stuff all the time, bought a cadet rear time tiller one fall for $300, sold it in the spring for $450. There was a time I would deal in anything if I made money.

Now for the first time I’m selling everything, backing way down and getting out of debt. Im down to one steer, had 4 or 5 at one time hauling water via 5 gallon buckets everyday even in the winter. I like cattle a lot, I won’t get out of having cattle. I prob won’t sell the tractor, I traded up to having a nice diesel lawn mower from borrowing my dads every week lol.

Also at this point I see my tractor as a investment, after interest on the loan is paid and it’s paid off, I will break even on what I can sell it for, if it does work for me, that’s all just a bonus. Any money I put in it, I will get out if I sold.

 

[BrokeFarmerJohn]

A few comments from the trenches...

First... Insurance originally was to make the unbearable bearable... of course there are many levels of insurance and what some call insurance today is more like a HMO... where preventative measures and wellness comes into play.

Way back when... Hospital Plans made the biggest inroads... so if you were hospitalized the bills were manageable...

The question is what do you have to loose is often the place to start...

We serve those with unbelievable plans where everything is covered... mostly civil services, utilities... politicians and some of the old Union Plans were pretty amazing...

We also serve those with nothing... case in point.

A 15 year old girl gave birth to a child with a severe heart defect requiring several surgeries and NICU...

The 15 year old had nothing as a minor... her 29 year old mother was on Section 8... so nothing there either...

The infant had over a million dollars of care... most at Stanford with family stays at Ronald McDonald house... and this was 20 years ago... when a million was really a million. Finest medical care on the planet totally without cost.

I see similar all the time on a smaller scale...

The problem is that most on TBN own things... we have mortgages, expenses, dependents, etc... without insurance the alternative is bankruptcy... and to a lesser extent care...

There was a famous case where a man needed lifesaving surgery robbed a bank so that he would become a ward or the State for his medical care...

Interesting how that work... California prisons pay for sex reassignment surgeries etc...

Just something to think about...

So if I want a sex change I need to commit a crime in California?

Thanks for sharing.