The Magic of Health Bills and Insurance

Hey gang, welcome to another update where I complain about health bills. Seriously, why is health so expensive in the states.

Sure, I get pretty easy access to care because I have a big name insurance card but the health bills are still a pain considering how much I pay for that card. On top of that, you have to deal with all sorts of red tape in dealing with networks, dealing with denials and all that stuff.

For all that fun, have to pay like $400+/month(which is subsidized by my employer) to get the opportunity to pay a $3000+ deductible with a $6000+ out of pocket for a single person so double that for a family.

This has been a year of heath issues for my wife and I so we’re certainly using our insurance. I’ve already met my deductible and my wife is on her way to meet hers so that means health bills will slow down soon(or at least get smaller).

Still, I had to pay a bunch of stragglers from before I met my deductible this month and also have some left over for months ahead. I still have outstanding costs from services I got in March where it still shows it as insurance pending and a bill hasn’t been issued. So I’ve got that to look forward to, which is nice.

Beyond that, even though I met my deductible, I still have to pay my coinsurance until the out of pocket is met so more health bills in the future too.

What a joy!

Oh well, at least I’m in a lucky spot where I can actually afford healthcare, which isn’t the case for a good portion of the people in this country even if they have insurance. After all, who’s going to go in for a minor thing if the cost is unknown(since you can’t really look up costs anywhere) and you have a massive deductible.

If you’re on one of those copay plays, you’re a bit lucky but even those are getting more complicated these days with certain services offered at the physicians office applying towards the deductible and coinsurance.

What a mess! Maybe I’ll do a full post soon about why our system sucks since this is supposed to be a dividend and expense update!

If you’re annoyed by our healthcare system, here’s a picture of my bunny to bring that blood pressure down.

 

Isn’t she a cutie?

Anyway, let’s get down to things. On the dividend side, May is a slower month that slips in right before the big month of June.

And yes, I’m aware I’m posting an update about May when it’s already July. I’ve been a bit of a slacker on the blogging front and have spent more time on my YouTube channel. I mostly talk about stocks there and not really personal stuff and sometimes that can be more fun.

Last May came in at $231.30 which was actually a decrease from the year before due to rates falling, dividend cuts and all that good stuff so let’s see where I sit today.

May Dividends

May’s dividends come in at $295.50 which is a nice 27.8% bump over 2020. It’s also a 17.5% boost over 2019.

It’s nice to see these smaller months start to grow. That’s due to my continued investments but also due to additional investments in my M1 Finance portfolios which hold individual stocks that pay in these off months.

ETFs and mutual funds make up the majority of my holdings which is why the majority of my dividends are in quarter ending months but these smaller months are growing too.

My M1 dividends sat at $34 last year and are now up to $64 this May and growing. I

think that will help these off months slowly catch up to everything else although they’ll still lag in the long run. My goal for this year is to get all these months above $300 by the end of the year and start trending towards $400 next year. I’m certainly close in May and am hopeful to get that number up to $300+ by the time July and August roll around.

Steve, my dividend employee, earning himself $1.77/hr which brings his annual wage up to $4.48/hr. It’s not quite enough to live on yet but Steve has his best months ahead of him and that hourly wage will go up soon. I guess I’ll have to continue working to invest so I can support Steve’s dream of not working in the future. That’s especially true if there’s inflation ahead although hopefully these dividends would keep up with that.

June is up ahead and that’s a big month for good old Steve. You can see in the graph below that gap these small months have against the big months.

I’ve still got pretty big months ahead and Steve’s hourly rate will go up a decent deal before the year is over as I keep investing and wait for the 3 biggest months to throw off solid dividends I can re-invest. I’m actually starting to get into spots where these bigger months outweigh what I’m able to save in those months and that’s pretty nice.

May Total : $295.50(+27.8%)
2021 Total : $3,732.09(+26.1%)
Portfolio monthly hourly wage : $1.77/hr
Portfolio annual hourly wage : $4.48/hr

May Expenses – Health Bills, booooo

This is the most expensive year I’ve ever had. We bought a house, bought a ton of crap for it, had an unexpected tax bill and I’ve had a bunch of health bills to deal with as well.

I’ve already spent 77% of the money I spent in all of 2020 through May and 2020 was a more expensive year than average. I’ve spent 94% of my 2019 full year expenses through May.

I’ve had no months above a 50% savings rate so far and had a negative month in January(house purchase related).

That’s whack!

Last year I had a 51.3% savings rate in May but that was a 3 paycheck month. The three paychecks moved over to April this year(and I still had a sub 30% savings rate there) so it’s not a good comparable this month.

Let’s take a look at where my money went this month.

My savings rate for May was 26%. Adding in employer contributions brings that number to 32.9%

Since we own a house now, adding in equity brings the 26% up to a 36.7%(31.9% with just the extra equity payments I made). With employer contributions, that number becomes 43.6%(38.8% with just extra equity payments).

On the gross income side I saved 19.9% or 25.1% with employer contributions. With equity, those numbers go to 28%/33.2%.

Houses really do make these calculations messy!

It’s not an amazing savings rate but with the way this year has gone, any positive month is nice.

On the expense side, health bills were at the top. As I said before, these were a few payments for doctor/specialist visits and some tests too. This number should slow down soon but probably not until August as I have some known bills on the way plus I have to get some crowns put in and that’ll be expensive too. Even after that I’ll still have coinsurance to pay for any visits I have before the end of the year.

Overall, this is going to be an expensive year and health expenses are a big reason why.

Groceries were next followed by health insurance. Remember that thing? Yea, I pay 5%+ of my income each month for something that still has me spend 20% of my income regularly. What a system!

After that, I actually had some blog expenses as I spent money to renew this sucker for another year. I don’t write as much these days but do plan to get back on the blogging horse soon enough.

I also bought a few things for the home, just some stuff for the kitchen and a few other things. I also picked up a few things for lawn care as well. We might actually have to have our first home fix expense soon as our pipes have been clanging and we might need to get something installed to lower our water pressure which is way too high.

Beyond that, it’s somewhat standard stuff. We did go out to eat once or twice and feel better about doing so now that we’re both vaccinated.

Overall, while this has been a tough year on the savings front, it’s still important for me to keep all that has happened in mind and not get too worried about it. We bought a house which is going to drive expenses up a ton and the health issues certainly haven’t helped things much.

I know this is probably going to be one of my worst spending years ever but I’m happy with where my life is heading and really love the house we’re in. I’m super glad to have bought a home right before the prices started to rise in this area.

Even though our area has been relatively steady in terms of pricing in recent years, our home would probably sell for nearly 10% higher just a few months after we bought it. It’s crazy and I’m hopeful it’s not a sign of huge inflation that will make it even harder for many to find a home.

I never though personal home ownership was a great investment(unless you live in one of those rare city areas where houses double every few years or are a landlord in a variety of areas, two things that don’t interest me) but I’m glad to have inflation protection in the form of one our biggest expenses locked in as rents keep rising in the area.

With that and continued investing each month, I’m glad to be building a foundation that will certainly mean that my dividend numbers a few years from now will send Steve into well-paid status sooner than later. That’s the power of long-term investing!

Thanks for reading and see you soon for the June update!