I thought I’d weigh in on the insurance issue. I’m self-employed and I pay $160/month through Blue Cross of CA for a policy that has a $10K deductible and covers 100% of everything else up to $2 million of health costs annually. So, essentially, I’m self-insuring myself for the first $10,000 and insuring through Blue Cross of CA for anything really serious.
This is probably the best sort of plan for anyone with ALL of the following characteristics:
(1) self-employed;
(2) healthy – no known pre-existing health issues;
(3) single or married with no kids;
(4) under 55;
(5) enough liquidity to comfortably pay $10K if something bad comes up.
Many folks here in the U.S. are way overinsured for their real needs. When I was an employee several years back I paid $270/month through some high-fallutin’ plan and I think I used about $100/year of that insurance when I’d go to the doctor once a year for a check-up. Otherwise, it was flushed down the toilet. Had I not been part of group coverage, I’m sure that same coverage would have cost $400/month or more. Now, I’m not against insurance, per se. But a lot of people don’t think about their real insurance needs and how they should structure their policy. If you meet 1-5 above, self-insuring that first $10K is probably the most cost effective means of insuring yourself until you hit 55. For what it’s worth, my doctor agrees with this thinking as well.
