If you have an autistic child, you too should have a medical sinking fund as a category in your budget. It will help pay for your part of your health insurance deductible, co-pays, coinsurance and fees that aren’t covered by insurance.

What is a sinking fund?

Sinking funds cover certain expenses that occur regularly but are not the same every month. Think about quarterly insurance payments, digital annual subscriptions, home improvements and gifts for the holidays. While these aren’t monthly expenses, you still need to account for them each month so that your budget isn’t sidelined when the bills come due.

Medical expenses may indeed come monthly for a family with an autistic child. Yet, those expenses aren’t the same usually every month. They come sporadically as medical bills make their way through insurance processes or when services occur.

Why do I need a medical sinking fund?

It is important to have a robust medical sinking fund when you have a child with autism and ADHD because medical bills are one of the ways that families are financially impacted by autism.

Having a medical sinking fund can ensure that you can pay medical bills when they arrive. Expenses generally vary month-to-month for most of us who have autistic children. One month may be light with a couple of co-pays and some over-the-counter medicines. Other months can be heavy in expenses. That can include the time period when you have to pay higher out-of-pocket amounts until you reach your deductible. (And be sure the provider is submitting all claims to your insurance to ensure every dollar counts toward that deductible!)

How do I find the money for a sinking fund?

So how can you build up a medical sinking fund? For me, I have a medical category in my monthly budget. I have a designated amount that I put into for each paycheck. I know expenses are going to be much higher in the early part of the year as we are paying our part of the insurance deductible. Then, it will be lower usually in the second half of the year. I don’t vary the amount – I put in the same amount knowing it will balance out over time.

In addition, I receive an annual bonus from my day job. One of our line items for our bonus spending plan is always to add to the medical sinking fund.

How can you find ways to boost your sinking fund?

• Make sure your medical sinking fund is a category in your monthly budget and ensure you are putting a good amount into it from each paycheck.
• Use a portion of any bonuses, tax returns, gifts, rebates or any other windfall money for your medical sinking fund.
• Sell unused items and put the money in this sinking fund. You can post “for sale” notices on your local Facebook Marketplace, E-bay, Craigslist, Next Door or other online marketplaces.
• If you have major expenses that you cannot manage on your own, consider crowdsourcing. You can use GoFundMe, MedGift or JustGiving. See this guide from MedGift for ideas about how to do this.

Do you have a medical sinking fund? What other helpful tips do you have for boosting it? Leave a comment so that we can share and encourage each other on this journey.

The post Medical sinking fund can help your finances when you have an autistic child appeared first on Autism & ADHD Connection.

Understand your current financial state

If you don’t already know your current financial state, it’s important to understand where you are at right now. Think of it as one of those “you are here” points on a map. This will be key for budgeting for autism families.

So how do you do this? Here is some information you will need to collect and evaluate:

• Take a look at your spending for at least the past six months. If you haven’t been tracking expenses, then look through your checkbook and credit card statements. What have you been spending your money on? Does anything jump out to you?
• Determine how much debt you owe. I know a lot of times we don’t want to face this information, but we can’t take control of our finances if we don’t see the full picture. Gather your latest statements for any debts, including personal loans, credit cards, student loans, vehicle loans, mortgage, medical bills and any others. List the balances and add them up. I know this can be uncomfortable if you haven’t dealt with it before, but it’s so important for you to take this step. We will discuss a debt reduction plan later in this article. Right now, you just need to know where you stand. These are your liabilities.
• Identify your full amount of investments. Do you have retirement accounts for you and your spouse – either 401(k), 403 (b), individual retirement account (IRA) or other type? How about any investments in individual stocks and bonds? Do you have a mutual fund outside of a retirement account that you contribute to? What about the market value of your home? College savings for your children? Savings accounts or certificate of deposits (CD)? Take all of those statements and add them up. These are your assets.
• With the information above, you can determine your net worth. Net worth is simply your assets minus your liabilities. Here is a good template to use when determining your net worth.

Identify your spending categories

To set up a monthly budget or spending plan, you will need to identify your spending categories. These are put into two primary groups: fixed and discretionary.

Fixed spending categories are those you must pay a specific amount each month. They include mortgage/rent, utilities, debt payments, internet, cell phones, insurance, medical bills, childcare, etc.

Discretionary spending categories are not a set amount each month. You have more control over how much you spend (or whether you even spend money on certain things). These include groceries, spending money, clothing, pets, fuel, entertainment, charitable giving, etc.

When determining your categories, don’t forget to account for expenses you have throughout the year but may not to pay monthly. For example, annual school fees for your children, Christmas (or other holiday spending), birthdays, semi-annual or quarterly insurance, annual subscriptions, etc. You want to ensure you create “sinking funds” for these categories and set aside money monthly toward them. Jesse Mecham from You Need a Budget refers to these as “your true expenses,” which means you make sure to account for your monthly expenses and those paid at other times throughout the year.

What about “rainy day” categories? I have quite a few of those too in my spending categories. Some overlap with the “true expenses” above and others are for categories for when things happen (like car repairs) but don’t have a specific timeline. Mine include:

• Car repairs
• Annual subscriptions
• Annual school fees
• Christmas
• Eyeglasses
• Home repair and maintenance
• Summer camp fund
• License plates
• Buffer

Finally, don’t forget to include any savings categories. I have a few in mine, including:

• Vacation
• Home improvements
• New phones
• New car

Determine your spending priorities

I know – money has to accomplish a lot each month. Yet, personal finance is “personal,” which means you need to determine what your priorities are for your family. The financial burden is real for families that have a child with autism, which means it is even more important to focus on what your money has to accomplish for you.

Evaluate the information you’ve collected so far. Are you spending money on the things you value the most? Are there expenses that you can reduce or eliminate because they are not helping you reach your goals? Decide what your spending priorities for the next year will be (or even the next six months if you need a shorter timeframe). This is key for budgeting for autism families.

Pledge to live within your means

One of the biggest financial problems for people of all ages and walks of life is spending money they don’t have. I am certainly guilty of this when I was younger, especially in my 20’s. Fortunately, I pledged that I would get my finances under control and live within my income. Having that mindset changed the way I looked at my finances and helped me a great deal with cleaning up my money issues. I got out of debt and increased my savings significantly. My husband and I decided we would pay for our wedding and honeymoon only with cash. That was a big deal for us, and it helped us take a positive financial step as a married couple right at the start.

Be sure to have the right tools

There are so many tools to help you with your budgeting journey. I personally use the You Need a Budget online system (referral link) and absolutely love it. I also tried the “EveryDollar” app in the past, and I know many people use Mint.com or Personal Capital. Don’t want to use an electronic tool? There are many spreadsheet templates available online. I created my own when we first started budgeting and kept the monthly sheets in a binder in our kitchen. Figure out what works for you!

Consider using the envelope system

When I first started budgeting, it was helpful for me to use cash for certain categories to make sure I didn’t overspend. Those included groceries, eating out, cash, date night, etc.

Each paycheck, I would go to the bank and withdraw a certain amount that I needed for that month. I then split the money into my cash envelopes for the month. There is something about having to hand the cashier the actual cash money that makes you much more aware of the money you are spending. Paying with a debit or credit card is not the same.

Once the money in an envelope ran out for a month, then that was it. I needed to wait until I was paid to get the next allotment for that envelope. This system really helped us stay on budget for those categories!

Be flexible each month

I naively thought when I first set up a budget that it would be the same each month. Well, that is certainly not the case! The fixed categories are usually similar, but they still change with annual or quarterly adjustments. There always seem to be some exception for the month or an expense not fully anticipated. This can be especially true with medical expenses and services you need for your child.

That is okay. Budgets, or spending plans, are not set in stone. Flex when you need to so that you can keep your budget overall on track.

Of course, there is a difference between being flexible with your budget and consistently overspending in a category. If you find that you are overspending in a certain category each month, you probably haven’t put enough money in that category and need to adjust. Or you need to double down on the priority of that category and figure out why you tend to overspend.

My problem area is eating out. (I think many people can relate to this one!) I set a certain amount for the month for this category, but then things happen, or I’m too tired to cook. That leads to takeout one or two too many times that month. Meal planning has helped me to reduce this overspending and having some easy meals (love frozen pizza!) on hand also has helped me to avoid overspending so much in this category.

Ensure you are getting the most from your health insurance and government assistance

Many autism families need to figure in health insurance and government assistance for their budgeting. For health insurance, be sure you know what your annual deductible and coinsurance/co-pays will be. Make sure that you account for those in your budget. Then, ensure you are getting the most from your health insurance benefits. It was surprising to me just how much was covered for the care and services we need for our son J.

Also, do you have any type of government assistance for your child or family? We have our state Medicaid autism waiver for our son that allows him additional services not paid for by our health insurance. Some families receive Supplemental Security Income (SSI) for their child with autism. If you need assistance, reach out to your local autism support group or organization. They may be able to help and direct you to local resources. These can really factor into budgeting for autism families.

Build your emergency fund to plan for the unexpected

One thing we can certainly anticipate in life is that the unexpected will happen. To prepare for those situations, it’s important to build an emergency fund. Experts suggest having on hand in an accessible savings account of about three to six months of living expenses. Given the recent economic challenges, some recommend more like eight months (especially if you or your spouse have jobs that would be difficult to replace if you were laid off). Emergency savings is especially important part of budgeting for families with a child who has autism.

I have two types emergency funds personally. I have a smaller one in a savings account of a couple thousand dollars to handle things like a plumbing problem that needs to be fixed, an appliance major repair or replacement or an emergency room visit that has a higher out-of-pocket cost than our typical medical expenses. We then have our larger emergency fund with several months of living expenses.

You can set up your emergency savings in a way that works best for your family. Just make sure it’s in an account that you can get to quickly.

How do you build an emergency fund? There are several ways to obtain the money for your emergency fund:

• Make it monthly spending category and put money into it each month.
• If you set up a savings account for your emergency fund at a different bank from your other accounts, that will help deter you from tapping it for expenses that are not emergencies.
• Automate it by setting up a monthly (or twice per month, depending on the frequency of your paychecks) transfer from your checking to savings account.
• Sell unused items and put the money into your emergency fund. We all have things we don’t use anymore. If someone else will buy it, then you can put the money to good use. You could even hold a garage sale and put the proceeds into your emergency fund.
• Delegate all or part of bonuses, cash gifts, tax refunds and other windfalls of money to deposit into your emergency fund.

Enhance a medical sinking fund

For autism families, it’s important to have a robust medical sinking fund in our budgeting. Not only do we have health insurance deductibles and co-pays/coinsurance, but we also tend to have other out-of-pocket expenses for the care and services for our children.

Each year, I put a chunk from my annual work bonus into our medical category. This is in addition to the monthly amount I designate. This has been so helpful over the years to help us ensure we have enough for medical bills.

Decide where you can cut expenses

We wish we could fund all of our needs and wants every month, however, that just isn’t reality for most people. That is where your spending priorities come into play. Take a close look at the budget you’ve created. Now, where can you cut expenses? This is another key to budgeting for families with a child who has autism.

A big area usually is grocery shopping. You can save a great deal through meal planning, using coupons, buying generics instead of brand name products, using grocery apps like Ibotta (referral link: use code wwjiomm) and Fetch Rewards (referral link: use code VB7XE and receive 2,000 points) , and more.

You also can save money on clothing by signing up for reward programs at your favorite stores, buying second-hand clothing at thrift and consignment stores, mending clothes when possible, creating a capsule wardrobe and/or choosing not to buy clothes you really don’t need.

What are some other ideas for cutting expenses? Here are just a few, but I bet you could think of countless more!

• Shop around for car and other types of insurance. Can you get a lower rate with another company?
• Call your Internet service to see if they can lower your bill. If not, is there another service in your area that is just as good but costs less? I saved more than $42 per month by making a switch this past year. That is a savings of more than $500 per year!
• Scour your house for items you can use before buying something new. For example, do you need a small storage bin? Check your storage areas of your house to see if you have a basket, decorative box or bin that you already have.
• Join a Buy Nothing group in your area or sign up for Freecycle. It’s amazing all the things people have that they don’t need anymore, but you could use them. If you are on Next Door, many people list items they would like to give away for free or sell at a low price. You also can post what you need and see if anyone has something to provide.
• Use your local library to borrow books, DVDs, games and more! Your library may even have a Makerspace that provides different equipment for hobbies and work, such as 3D printers, sewing machines, electronics, wood working, soldering and more.
• Check out used bookstores if you want to purchase some books to own. We love Half Price Books in our area!
• Encourage low cost entertainment by suggesting potluck dinners, movie nights at home, hiking, picnics, playground playdates and outdoor barbeques to friends and family for get togethers instead of expensive dinners out and other activities.

Set up a debt reduction plan

If you have debts, one of the best things you can do is include goals to reduce them. Whether you have student loans, car loans, medical expenses, credit cards, personal loans or other debts, focus on decreasing those. Each loan includes interest, which means the cost of the loan is much greater than the principle amount you needed to cover the expense. Personal loans also have an emotional and relational cost if those were taken out through a family member or friend.

Two popular ways to tackle debt include the debt snowball and the debt avalanche. What are these two approaches?

• The debt snowball method includes tallying your debts by amount, smallest to largest. You begin by focusing on the debt that has the smallest amount. You throw as much money as you can to pay off that debt while still paying the minimum amount on your other debts. Once you pay off the first one, you roll the money that you were paying on that one into paying off the next smallest debt. You keep using this process until you’ve paid off all your debts. Psychologically, some people prefer this method because they see the number of debts paid faster because you work from smallest to largest.
• The debt avalanche method is similar, except that you order the debts from highest to lowest interest. The pay-off approach is the same, however, you put more money toward paying off the debt with the highest interest first. Many times, this is credit card debt. This allows you to pay off the debts with the highest interest first, saving you more money overall.

When my husband and I were paying off debts, we took a combination approach. We started with the credit cards (which had the smallest amounts plus the highest interest rates), and we paid those off first. Then we tackled a motorcycle loan and student loans. Finally, we focused on paying off our car loans. Currently, all we have is a mortgage, and we pay additional on the principle each month to pay it off way earlier. We bought our current home in 2018, and we’ve already reduced the length of the loan by about three years by paying more each month. That will save us a big amount in interest if we keep paying at this rate.

Know when to seek help from a financial advisor or coach

Sometimes, we need help with our finances, and an advisor or coach may be worth the money to get us on the right track. It’s also good to obtain the services of a financial advisor for specific investment guidance, special needs trust funds and other specialized advice.

What budgeting advice do you have for families with a child who has autism? What has worked well for you? Leave a comment below, so we can encourage and support one another!

The post How budgeting can help autism families take control of their money appeared first on Autism & ADHD Connection.

Although we live on one income, we have been fortunate to have enough income to cover our expenses. I am a personal finance geek, so I enjoy looking for ways to maximize our money and find ways to save on expenses. That has come in handy to find ways to cover the costs associated with our son J’s autism. That includes the higher health plan deductibles, coinsurance and therapy not covered by insurance. I have followed the steps throughout the more than a decade that we’ve been on this autism and ADHD journey.

1. Research assistance options

If caring for your child does not allow you to work enough hours or hold a job that brings in enough income for living, you need to first research your assistance options through your state. There are many programs that help provide a safety net for families when they are needed. They can be key in helping you to overcome the financial burden of autism.

2. Understand your health care benefits

Our kids tend to need a lot of medical services, including behavioral therapy, occupational therapy, applied behavioral analysis (ABA), speech therapy and more. Those are, of course, on top of all the general medical needs such as visits to your child’s primary care physician, vision exams, dental check-ups and more.

I have found that it’s difficult to locate a detailed overview of my health plan benefits, so I’ve taken the time to call my plan’s customer service to better understand what services are covered for autism, the deductible we must pay and coinsurance or copay requirements. Sometimes, I’ve discovered a service I thought wasn’t covered at all is covered at a certain amount if I took J to an in-network provider. It’s a pain to have to wait on hold to talk to a member service representative, but I think it’s been worth the effort in the long run.

3. Look for in-network providers and compare prices

One way to save a lot of money on medical services is to stay with in-network providers for your health plan. Usually they have online provider directories to search for doctors and other health care professionals in your area. Or if you do locate a provider near you, always ask if they accept your insurance as an in-network provider before making the first appointment. (Understanding this also can help you create a dream team for your child.)

Even for in-network providers, your health plan may offer some price comparisons for different types of services on their website. It’s good to look for that information, so you will understand the cost. It’s especially helpful if you are on the fence about whether your child really needs a specific therapy or service.

4. Apply for a Medicaid autism waiver

Applying for a Medicaid autism waiver takes some time – completing the forms and being put on the waitlist for the waiver, but it offers so many benefits. The waiver is generally not based on financial need but on the medical needs of the patient. Therefore, even if you make a decent income, your child may be eligible for the waiver, depending on which state you live in.

I know the waiver has been really helpful for covering services for our son J that aren’t usually covered by traditional insurance. He received a few years of music therapy through the waiver, which has been such a great way to help him cope with anxiety from his autism. It also covered summer camp because it was run by a provider for patient assistance and care services. He also has received behavior therapy that was in addition to seeing his normal therapist through our traditional medical insurance.

The type of services and the amount that is provided for each child is determined by your state. You also work with a case manager who helps to arrange and manage your child’s care that they receive through the waiver.

I was hesitant to apply because the wait was so long when J was young. However, our state received some funding that allowed them to eliminate the backlog, so he received the waiver so much earlier than we thought. We also were able to receive more services – such as music therapy – than we would have since those are covered by the waiver but not our insurance.

5. Contact your local autism patient advocacy group

When you don’t know what resources are available in your area or where to start, reach out to a local patient advocacy group such as the local chapter of the Autism Society of America or even a local autism support group. They often can tell you what is available and even let you know what type of assistance they offer to families to help them overcome the financial burden of autism. Your child’s school may also have information available.

6. Budget for expected and unexpected expenses

As a personal finance geek myself, I am weird in that I love budgeting. (Yes, I know that many people view “budget” as a four-letter word!) I have found that it gives me more freedom in my spending and helps me to create a spending plan for our family. That allows me to not only budget for the normal monthly expenses but also put away rainy day funds to cover costs the come up infrequently or unexpectedly. For budgeting, we love You Need a Budget (referral link), also called YNAB. It does have a cost, but I found it pays back dividends in how well we are able to track and plan our expenses. Other free options in Every Dollar from Dave Ramsey and Mint.com.

Having an emergency fund of three to six months income is so important! It can act as a buffer when a medical or expense arises that you hadn’t planned for or anticipated. We can always expect that unplanned for costs will happen from time to time. An emergency fund allows you to cover it without going into debt.

7. Evaluate your spending to find ways to reduce expenses

There are so many ways to save money! However, the first step is to evaluate what you are spending and determine how you can trim your expenses. Do you spend too much on groceries? (With two teenage boys, this is an area we struggle with in our budget!) Could you switch to generics, change to a less expensive store like Aldi or use coupons if you don’t have a discount grocer near you? Do you eat out too much? To reduce takeout, could you batch cook on the weekends and freeze dinners to eat later. Is your electric bill sky high? Could you make a concerted effort to turn off lights, lower your temperature for heating/increase it for cooling or choose energy efficient appliances when they need to be replaced?

One way to gain ideas for how reduce spending or live more frugal is to follow some personal finance blogs. Some of my favorite are Frugalwoods, The Simple Dollar, Frugal Girl and The Penny Hoarder. These will offer some great ideas and additional tips for how you can overcome the financial burden of autism.

Looking for a couple of personal finance books with some good advice? A few of my favorites are Total Money Makeover by Dave Ramsey (affiliate link), You Need a Budget by Jesse Mecham (affiliate link), and Your Money or Your Life by Vicki Robin and Joe Dominguez (affiliate link).

8. Set up your finances to make things easier for you

You already have a great deal on your plate with taking care of your child, arranging all their care, going to various appointments, communicating with your child’s teachers and so much more. That is on top of all the regular life stuff like working, managing your household, caring for your other children, and trying to fit in some fun activities.

Therefore, setting up your finances to run automatically when you can make life easier. For example, set up on reoccurring bills each month on autopay and paperless billing. Then as you receive notifications of your bills coming up, you can quickly note them in your checking account and record them in your expense tracking. It only takes a couple of minutes, which is less time than writing a check and sending it via mail.

You also can set up automatic transfers from your checking to your savings account through your bank to put money into an emergency fund or savings account. Have an ABLE or 529 account for your child? Set up automatic transfers for those contributions as well.

I also have an alert set up through my credit card to send me an email whenever a purchase is made without my card being present. That allows me to make sure we aren’t missing any online purchases that we forgot to account for in YNAB. It also allows me to catch any fraudulent activity when it occurs or remind me of an annual subscription that we may be able to cancel if we aren’t using it.

9. Consider a side hustle

Do you have a hobby or activity that you do well that you could make extra income doing? If you have some time, it may be worth capitalizing on something you enjoy, bringing in some extra money.

For example, if you love making crafts, then you could sell those on Etsy or through Amazon Marketplace. If you love restoring furniture, you could sell the restored items through Craigslist, a local consignment shop or the Facebook marketplace for your local area. Love to write? Start a blog or do some freelance writing. The possibilities are endless.

Even though money issues can be stressful, there are ways you can overcome the financial burden of autism. What are some ways you’ve been able to successfully manage your finances despite the difficulties covering the expenses of autism? Leave a comment to share and encourage others on this journey!

The post 9 tips to overcome the financial burden of autism appeared first on Autism & ADHD Connection.