WITH the cost of groceries, fuel and electricity rising, South Africans are facing money problems.
However, this can be used as an opportunity to take stock of your personal finances and cut where possible.
Tony Singleton, CEO at Turnberry, said while salaries of workers remain unchanged, cutting on medical aid and insurance was never a good idea.
“The one thing that Covid taught us was the importance of having private healthcare in place,” said Tony.Tony Singleton, CEO at Turnberry
He said for young, healthy people, it can be tempting to reduce or even cancel medical aid and gap cover products as an unnecessary expense in the current economic climate.
However, while this may save money upfront, from a long-term view it could end up costing even more.
He said without the medical scheme plan, people will end up paying more out of pocket when accidents or illnesses occur.
“Lower premiums and lower medical plans typically come with increased co-payments and reduced cover, which means increased shortfalls when healthcare is needed,” he said.
Tony also said that if clients stop their medical aid altogether, and then decide to re-join at a later stage, there are also late joiner penalties that may apply if they are over the age of 35.
These involve an increased premium of between 5 and 75% every month, so it is very important that clients are made aware of this upfront.
He urged financial advisors to educate their clients to make informed decisions while time still allows.