Financial Planning After a Personal Injury: Tips and Legal Considerations
Suffering a personal injury can have major financial implications beyond just medical bills, especially for men, who account for 66.8% of preventable, injury-related deaths. Proper financial planning and understanding your legal options are crucial for managing costs and securing compensation after an injury. This article provides tips and considerations for navigating finances after a personal injury.
Assessing Your Financial Situation
The personal injury market in the U.S. was valued at over $53 billion in 2022 and continues to grow, indicating the extensive costs injuries can incur. The average medical cost alone for a single injury is around $40,000 when factoring in lost wages. Even less severe injuries like a broken arm average $2,500 in medical bills.
With steep medical bills likely, your first step is taking stock of your financial situation. Review your current income sources, savings, and assets to determine your ability to cover injury-related costs. Understanding your finances will guide decisions on legal action and lifestyle changes needed to afford care and recovery.
Exploring Legal Options
For costly injuries, legal action is often necessary to secure compensation. Consider hiring a personal injury lawyer, especially for complex cases. An attorney can estimate the total value of your claim based on medical bills, lost income, pain and suffering, and other losses.
Certain states see higher rates of personal injury legal action. Florida, for example, leads the nation in injury-related lawsuits per capita. Your geographic location is a factor when weighing the need for legal counsel. Consult with a local attorney on state laws and your chances of obtaining damages.
Filing Insurance Claims
Notify your health insurance provider about the injury as soon as possible. Submit any related medical bills and costs to your provider for coverage per your policy terms. For injuries resulting from an accident, you may need to file a claim with the at-fault party’s insurance as well.
If your lost wages are not covered by a liable party, consider filing a disability insurance claim if you have this coverage. Understanding the claims process for various policies can help recoup costs associated with the injury.
Changing Lifestyle and Expenses
With injuries limiting mobility and activities, you may need to rework your budget and expenses. Identify areas to cut back, like dining out, travel, or shopping. Explore lower cost transportation options if unable to drive, like public transit or rideshares. Meal prep at home can also help reduce daily costs.
Home modifications like ramps or grab bars may also be required, which can be expensive. However, certain tax credits and deductions exist for home medical equipment and accessibility updates if prescribed by a doctor. Keep receipts for these just in case they apply to your tax situation.
Leaning on Others
Don’t be afraid to lean on others for support during financial hardship. Many nonprofits and charities provide assistance for injury victims’ medical bills and rehabilitation. Your roommates or family may agree to cover a larger share of the housing costs temporarily. Crowdsourcing medical expenses is also an option.
Recovering from and financing an injury can be daunting. But strategic planning of finances, insurance claims, legal action, lifestyle changes, and outside support can help manage costs. Consult professionals like attorneys and accountants to understand how to proceed in your unique situation. With the right preparation, you can alleviate financial stress and focus on healing after an injury.
