Savings/Investment Advice for Young Cancer Survivor
November 6, 2018 3:40 AM   Subscribe

Summary: I'm 33 with a ~60 percent chance of becoming terminal within 5-10 years. Saving for retirement doesn't make sense, but I'd like to set aside money for health emergencies and bucket list trips (and ideally have it gain interest). Best options?

Background: I was treated for cancer last year, but it was aggressive and is about 60 percent likely to return (in a terminal stage) according to my medical team. If this happens, my average survival would be approx 3 years if I were to undergo further treatments. (I'm in the U.S. where health coverage is unpredictable right now, currently on an ACA plan and working part-time freelance).

I'm 33, with some modest savings sitting in the bank. I want to be smart with my money, but putting it into an IRA, Roth, or similar type of account that I can't touch for 30 years - even for 15-20 years, if I'm being realistic - doesn't really make sense.

I may need the money either for medical bills, to support myself if I need to quit working indefinitely, and/or to do some final traveling if my life turns out to be shorter than I want. I'm advised, though, that a regular savings account at the bank is pretty worthless. I don't know much else in terms of finances, but I'm wondering what some options are for growing my savings (or putting them somewhere less taxable?) considering my circumstances.

Basically, I anticipate needing access to the money within 5-10 years, at which point I would hope the amount could be larger than it is now, especially if there is an option to contribute more monthly or something while I still earn income. Is this possible?
posted by CancerSucks to Work & Money (7 answers total) 2 users marked this as a favorite
 
I'm a cancer survivor myself at substantial risk of recurrence. I can't give you good financial advice because I'm crap with money, but I can advise you to plan for two possibilities: That you may die young, or you may live to a ripe old age. Definitely do not make all of your financial decisions based on the assumption that you won't live to see retirement. A 60 percent chance of recurrence is scary but it's also far from 100 percent, and if you focus too much on the short term you may be surprised to find yourself 65 years old and broke.

I'm so sorry you're going through all this, and it makes sense that you'd be trying to prepare for an early demise. But while you're making those plans, you also have to plan for your old age. It's an annoyingly bifurcated life that people face after they've experienced serious illness, having to work hard for a future that may never come. But I try to remind myself that this is kind of how everybody lives. We never know when we're going to die, so we just have to do the best we can with whatever time we've got.
posted by Ursula Hitler at 4:02 AM on November 6, 2018 [6 favorites]


Basically all the retirement savings plans have exceptions to the penalty for reasons of medical hardship, including things like disability, losing insurance, and medical expenses beyond a certain percentage of income. It's definitely worth looking further into them before opting against them.

The simplest is a Roth IRA. You can withdraw your investments at any time. It's only the interest earned that is subject to penalty (which again, is also waivable under certain circumstances). You can basically treat it as a savings account with deferred interest up to the annual maximum contribution. In your shoes I think I'd start with that.

Another advantage of putting money into these retirement accounts is that they are generally sheltered from collections and bankruptcy. So if you do need to do a bankruptcy (common for medical expenses reasons), you can keep something instead of nothing. It may seem counterintuitive, but it is often advisable to use credit rather than retirement savings for medical expenses.

Does your treatment hospital have a social work team? They may be able to help you research all these options, or connect you to financial planning support for people in your position.

Otherwise, depending on how much money you're looking at saving and where you live, you can get high interest savings accounts that pay between 3%-5% interest on balances up to $15k or $20k. You have to jump through some hoops with direct deposit, but it's the safest highest interest rates out there at the moment, AFAIK. You can look on Doctor of Credit for more information on them. There are also regular savings accounts and CDs paying around 2-3% now that often have higher maximum (or minimum) balances. They're on that same list.

(I'm assuming that your ACA plan does not have an HSA, because that would be another good place for saving for medical expenses)

I'm sorry you're dealing with this. That really sucks. I hope you'll be in the 40%!
posted by Salamandrous at 4:04 AM on November 6, 2018 [10 favorites]


I'm a cancer survivor with a cancer that's considered incurable. My online support group is full of people who were told they had two or three years to live and are still alive ten or even twenty years later. A few made financial decisions based on their expected shorter life spans and are now having financial problems.

Cancer research can move very fast, and all survival statistics are by definition based on old data. I think all cancer patients and people who love them should read Stephen Jay Gould's essay The Median Isn't the Message.

So I agree with Ursula Hitler. All financial decisions should take into account the possibility that you may live a very long time. I understand that it's emotionally very tough to plan when you have a cancer diagnosis, and there are a few things, like medical expenses, that you're more aware of than other people. But anyone could get such a diagnosis at any time, and it's really not that different from planning for everyone else, even though it feels like it.
posted by FencingGal at 6:12 AM on November 6, 2018 [4 favorites]


There are health savings plan where you can put money in with a tax advantage, then use it to pay medical bills.
Consider moving to a state where the ACA is fully implemented and policy is less hostile to people who need health care. (I speak with some bitterness, my state has been terrible.)
Wishing you the best.
posted by theora55 at 6:50 AM on November 6, 2018 [1 favorite]


So Vanguard is ok for this. For short term (1 year) a money market account is ok. Better than most banks.

For a few years you can invest in a few bond funds.

For ten years, you can look at stock market funds. Stocks are risky, and in the short term you may not come out ahead. But in the decade term, this is where you'll get the most return on investment.

I'm sorry you're struggling with this. Fwiw, I'd save half your spare income and enjoy living in the moment. Think about what will make you happy this year. Things may get hard, but they may not. You can plan something enjoyable for next week though.
posted by Kalmya at 5:18 PM on November 6, 2018 [1 favorite]


I would spend the money on living, not death. If your cancer does come back and is terminal I'd encourage you to think long and hard now about what treatments you want to endure and quality of life issues. Make those decisions now and be at peace with them. If you have dependants set up a trust now that the doctors can't touch. If not I say save for retirement and your bucket list and forget the medical bills. You'll be treated either way.

You could also use the money to move abroad.....
posted by fshgrl at 11:02 AM on November 7, 2018


I believe there are financial planners with expertise in this area. I tried googling “financial planning cancer” and a few things came up - maybe check that out.
posted by kat518 at 4:29 PM on November 7, 2018


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