How can I cut my expenses?

1. Carry a small notepad and write down everything you spend money on for two or three months. At the end of that time, look at what you spent money on. Are there any surprises? Is there anything you can do without or cut back on?
2. Before you buy something, ask yourself: “Do I need this? Or do I just want it?” You may be surprised at how many things fall under the “want” category. Try to buy only what you need, at least until you know whether you can afford some of the wants.
3. Compare prices at three places before you make significant puchases. Look for the lowest price, but also make sure you get good quality. (This does not apply to low-cost items.)
   

How can I cut costs on prescription drugs, medical costs, and other necessities?
Here are some ideas. Write down your own ideas after you read the information.

Prescription drugs

• Take your medicine on time. Take your medicine correctly. That will help you avoid more medical problems—and more costs.
• Read your insurance policy to find out if your insurance company will pay for prescription drugs, and if so, how much. Many insurance companies have a list of drugs for which they will pay. The list is called a drug “formulary.” The insurance company may require you to pay more for drugs that are not on the list. If your doctor prescribed a drug that is not on the list, ask the doctor to write a letter to the insurance company to explain why this drug is necessary for you. The letter can request that the insurance company pay for the drug. The letter may not get the drug paid for, but it never hurts to ask.
• Medicare alone will not pay for prescription drugs you use at home (as of 2002). However, if you have a Medicare managed health-care plan, you may have a prescription drug benefit.
• If you have a Medigap policy (private health insurance that covers some things that Medicare does not), find out if this policy will help pay for prescription drugs.
• If you are on Medicaid, your medicine may be covered.
• Talk to your doctor if you are having trouble paying for your medicine. The doctor may be able to prescribe a less expensive drug. The doctor also might be able to help you apply for help from the drug company. Many drug companies have special programs to help low-income people pay for their medicine. These programs are called “pharmaceutical assistance programs.”
• If you do not have prescription coverage, shop for the best price at several pharmacies.

— My plan for cutting prescription costs

Other medical costs

• Find a doctor you like and stay with that doctor. Changing doctors too often wastes time and money.
• Follow your doctor’s advice. The best way to avoid expensive medical problems is to take care of yourself.
• Ask your doctor for ways to save money on doctor’s visits, lab tests, and drugs.
• If you are unsure about a medical procedure, get a second opinion. The second opinion may cost extra. But it also may help you avoid the procedure.
• Ask your doctor to write prescriptions for items you may need, such as a walker, brace, or special bed. A prescription shows that you need the item, and it might convince the insurance company to pay for it. A prescription is also needed if you want to take a tax deduction for the expense.
• Look for other sources of help to pay for medical items you may need. Some places to look: your employer, your state’s vocational rehabilitation office, the Department of Veterans Affairs, religious groups, and community groups such as Kiwanis, Optimists, Rotary, or Shriners.
  
  

— My plan for cutting medical costs

Food

• Use a shopping list. Don’t buy on impulse.
• Buy generic brands.
• Stock up on items when they are on sale.
• Buy basic food items instead of prepared foods.
• Use coupons. In addition to coupons that are printed in your paper, you can find coupons on the Internet. Use coupons only when they result in a better price than alternative brands. There is no rule against using a calculator in a grocery store. Here are two sites to try: www.valupage.com; www.refundexpress.net.
• Meals On Wheels delivers meals to homebound people. Look in the business section of the telephone book for the number of your local Meals on Wheels program. Or visit www.mealsonwheelsassn.org.
  

— My plan for cutting food costs

Housing

• Consider finding a roommate to share expenses.
• If you own a home, refinance your mortgage if interest rates are lower than what you are currently paying. Ask your accountant or financial planner for advice.
• Look into a reverse mortgage. Ask your accountant or financial planner for advice.
• Do you need to fix your house? Call your local senior citizens center, church, or other volunteer organization to learn the names of groups that might be able to help you for free. Or ask for names of reliable people you can hire to do the work.
• Do you rent an apartment or house? If you are having trouble paying your rent, call your local housing authority or talk to your hospital social worker. Ask about help from the government. You might learn about Section 8 programs, in which you pay part of the rent based on your income. The government pays the rest. Many people request this help, so you may have to put your name on a waiting list.
• You may decide you cannot live on your own any longer. You may need to consider an assisted living facility or a long-term care facility. If someone is home to help you in the morning and evening, an adult day-care center may be another option. Your hospital social worker, your doctor, or the Visiting Nurses Association can help you with this decision.
• Long-term care and assisted care facilities can be expensive. If you have long-term care insurance, the insurance may pay for part or all of the costs. A long-term care policy also may pay for someone to take care of you in your home. Medicare will only pay for a short stay in a long-term care facility, and only if you are improving. Medicaid will pay for a long stay in a long-term care facility. To get Medicaid, you can have only $2,000 or less in savings and other assets, plus a low income. (Some assets are not counted, such as a house and a burial fund.)
  
  

— My plan for cutting housing costs

Utilities (telephone, gas, electric, and water)

• Your gas and electric companies may have programs for seniors or people with disabilities. Call the companies and ask about these programs.
• When you call long-distance, make a list of what you want to talk about and set a time limit.
• IBM has a program that provides discounted computers to people with disabilities: www.ibm.com/able.
• If you have a computer and are on the Internet, use e-mail instead of paying to talk long distance.
• Turn the water heater setting down to 140° F.
• Change furnace filters every two to three months when the furnace is being used. Turn down the heat at night.
• Let sunlight in during cold winter days. Keep it out during hot days.
• Do laundry in cold water when possible.
• Do you really need a cell phone and cable TV? If the answer is no, cancel them. Or, call the companies to find out if you can get a cheaper plans.
• Use the Internet at your library instead of paying Internet charges at home.
  
  

— My plan for cutting utility costs

Transportation

• Your city’s bus or subway system may provide free or low-cost transportation for seniors or people with disabilities. Some may even pick you up at your door.
• Your local Red Cross may provide transportation to medical appointments. Call 1-202-639-3520 to learn about a program in your area. Or visit www.redcross.org.
• Call your grocery store, pharmacy, and department store to find out about home deliveries.
• The National Patient Travel Help Line helps patients find discounted airfares. It also helps patients connect with private pilots who volunteer to fly people to and from medical appointments when they have no other way to get there. Call 1-800-296-1217 or visit www.patienttravel.org. Another place to try is www.airlifeline.org.
  
  

— My plan for cutting transportation costs

Taxes

• If you work but do not make very much money, you may be able to use the Earned Income Tax Credit. This credit will reduce your taxes. It may even give you a refund. You can claim this credit on IRS Form 1040.
• You may be able to deduct medical expenses from your income tax. Keep all of your medical bills. Also keep receipts for other things you buy because of your stroke. Examples are a wheelchair, the cost to drive to doctors’ appointments, and the cost to change your house because of your stroke. Make sure this information is taken into consideration when preparing your income tax return.
• Your local senior citizens center may have volunteers who will prepare your taxes for free.
  
  

— My plan for cutting taxes

Other sources of help

The organizations listed below can give you other ideas on ways to save money and find the help you need.

• The Time Dollar Institute is a volunteer “time bank.” No money is involved. Instead, people share their time. For every hour of time they give to others, they can ask for an hour of time from someone else. For example, Kate might volunteer to make telephone calls for Jacob. Jacob might volunteer to balance Kate’s checkbook or do some yard work for her. Call 1-202-686-5200 to find out if there is a program near you or visit www.timedollar.org.
• Independent living centers provide a wide range of services to people with disabilities. Call your state’s vocational rehabilitation office to learn more. Or visit www.ilru.org for a directory of independent living centers in your state.
• United Way is a good source of information about programs in your community. Call 1-800-411-8929 or visit www.unitedway.org.
• The American Stroke Association can help you. Call 1-888-4-STROKE (478-7653) and ask for the Stroke Family Warmline. You will talk to other stroke survivors and caregivers. They will understand what you are going through.
  
  

— My other ideas for cutting costs

How can I avoid having people take advantage of me
Here are some ideas for avoiding scams and spending traps:

• Telephone sales. Many companies sell things over the telephone. They sell windows, vacations, and even new mortgages. Because you have no way of knowing these people, you are better off not buying anything over the telephone. If you are interested in the item, ask the person who calls you to send you information in the mail. Then you can carefully read the information and compare it to other companies that sell the same thing. DO NOT give your credit card number over the telephone unless you are sure you are talking to someone reputable, and don’t give it over a cordless or cell phone at any time.
• Charities. If someone asks you for a donation, make sure the organization is a reputable charity. If you are unsure, ask to receive some information in the mail. You also can call the office of your state’s secretary of state to check out the charity.
• Contractors. Before you hire someone to do work for you, call at least three other people who have used this contractor. Ask if the contractor did a good job and charged a fair price. You may have to give the contractor some money up front to pay for supplies, but NEVER pay the contractor the whole bill until the work is finished.
• Check-cashing stores. If you don’t have a bank account, it can be hard to cash the checks you get. You can go to a check-cashing store to cash a check. But these stores charge money to cash checks. Most of the time, it will cost you less money to have a bank account. You also might be able to cash a check at your grocery store at no charge.
• Credit repair companies. Stay away from companies that promise to “fix” your credit for a fee. This is a scam.
• Internet purchases. It’s easy to shop on the Internet, but it can lead to problems. Here are four tips: (1) Make sure the company you are dealing with is reputable. (2) Compare the price with buying from a store, including shipping costs. (3) Don’t send your credit card number over the Internet unless the site is “secured.” That means your credit card number is scrambled so no one else can read it. If you are unsure, print the order form from your computer and mail it to the company. (4) Don’t let Internet shopping get you into debt.
• Resist pressure. Never let anyone pressure you into buying something. Don’t let them talk you into signing something you don’t understand. You have the right to wait a few days and think it over. You have the right to ask someone else to help you decide. Stand up for your rights!

— My plan for avoiding scams and spending traps

I am in debt. What can I do?
If you are in debt because of your stroke, try not to feel overwhelmed. The following ideas will help you take control of your debt:

• If you owe money to a few businesses, call them and ask for smaller payments or more time to pay. Call before you miss a payment. It may be hard to make these calls, but most creditors will want to work with you.
• If you owe money to many businesses, it may be time for outside help. Think about working with a nonprofit debt counseling service. Consumer Credit Counseling Service (CCCS) is one such group. CCCS can help you set up a repayment plan. Call 1-800-388-2227 or visit the National Foundation for Credit Counseling’s Web site at www.nfcc.org.
• If you owe money on several credit cards, try to pay off those with the highest interest rates first. If you cannot pay off the whole amount, at least pay more than the minimum every month.
• Keep only one credit card for emergencies. Choose a general credit card instead of a department store card. Look for a card with the lowest interest rate and no annual fee. Cut up any other credit cards you have. Throw them away, and call the companies to close your accounts.
• Consider bankruptcy only as a last resort. If you declare bankruptcy, it will be difficult to get new credit for many years. If you find yourself in this situation, call a lawyer or legal aid clinic before making any decisions.

— My plan for getting out of debt

How can I build or maintain good credit
Good credit is important. It will help you get a loan if you need it. Take these steps to build or maintain good credit:

• Pay basic expenses on time. Basic expenses include your rent, gas, electric, and telephone bills.
• Make loan payments on time. Mail the payment several days before it is due so it will arrive on time. To help you remember when to pay your bills, write down on a calendar when you should pay them. Look at the calendar every day. (Click here for a sample calendar.)
• If you can’t pay a bill on time, call the creditor and explain the problem. Do not ignore the payment. Call before the bill is due.
• Pay loans before you spend money to buy something new.
• Apply only for the credit you need. If you apply too often, lenders may think that you are using too much credit.
• Do not bounce checks. Write down each check amount in your checkbook. Subtract the amount from your balance. If it is difficult for you to do this, ask a trusted friend or family member to balance your checkbook for you. If you use a debit card and/or ATM, be sure to write down those amounts as well.

— My plan for building good credit