The uncertainties of life, what philosophers euphemistically call the vagaries of life, create situations that require our attention. We are not philosophers, so we have to attend to them. It was someone who said that all problems are economic. Thinking deeply, we attest to it. A lot many times it is a common problem to think if we need a Medical Emergency Fund Separately. Let’s understand it.

Problems can be of many types; societal problems, family problems, work problems, medical problems, and thousands of other types, but what separates medical problems is the sheer attention they require. You cannot focus on anything else when there’s a medical emergency. So, let’s find out what is so different in a medical emergency and why you need to plan it separately.

Medical Expenses Are Increasing

Growing older means your body is less active than in your prime. It does not have the same disease-fighting capability that it had a few years ago. Moreover, pandemics and widespread diseases have made it even more vulnerable. Naturally, there is an increasing need to be ready with the latest technology and medicine to fight new diseases.

Medical expenses are going up because of the complexity of diseases and the cost of research on developing solutions for these diseases. By the time people retire, the medical expenses inch higher, and during retirement, they keep moving upward. You may find it costly to enhance the size of your existing health cover after your retirement, so a medical emergency fund can help you match the inflation.

Insurance Cover May Not Be Sufficient

Insurance is a must in old age. It protects you from ballooning expenses and financial distress. However, the insurance policy covers reimburses up to a predefined limit. Beyond that, it is the patient who must pay from his pocket. This requires dipping into your emergency fund. Regular health insurance policies usually do not cover OPD charges, so a medical emergency fund can be handy for senior citizens to meet such expenses.

You Cannot Jeopardise Your Long-Term Financial Needs

You might think that the general retirement corpus should take care of medical emergencies. However, here you may go wrong. A medical emergency is a temporary situation which must be dealt with immediately. This situation will change once you recover in a few weeks or months. After that, life must go on for the next few years. It will do the utmost harm if you dip into your retirement corpus for a medical emergency. It will jeopardize your future. The money taken out of your retirement fund is gone forever. You will have to reduce your lifestyle, which possibly is already very frugal after retirement.

Finally, a healthy life is what everyone needs. While it may sound counterintuitive, a healthy body is needed more in old age. The sheer pleasure of walking to the nearest park, laughing with your friends and family, and going to the nearest restaurant for your favorite dish is precious. All these are possible only if you have a healthy life. So, make a separate emergency fund for your health needs.

The author is an independent financial journalist.