Overview: A typical vacation planning checklist is bound to include the usual considerations: booking a rental car, making hotel reservations and testing how much can really fit into that carry-on luggage. But not as many travelers consider what they would do if a health crisis were to occur on their trip. Following is advice on how to prepare and deal with such an experience while traveling.
Two couples vacationing together at a resort in Punta Cana, Dominican Republic, were surprised when one person in their party fell ill with two days remaining on the trip. They recognized symptoms of nausea, chest pains and sweaty palms as signs of a heart attack. The group took immediate action: They followed standard medical procedures for a possible heart attack by first calling for paramedics and then giving their longtime friend a baby aspirin.
A week later, he returned to the United States — after experiencing a confirmed heart attack, spending time in two different hospitals in the Dominican Republic, taking two airlifts and contacting numerous health providers spanning across two countries. His story and the experience of the entire group offer a cautionary tale with valuable lessons for all travelers.
Lesson 1: Purchase all-in-one travel protection insurance
This relatively inexpensive option is offered by most major travel companies. All-in-one protection provides extensive coverage, including for cancellations and medical expenses. Protection plans also provide emergency contacts and can offer access to local representatives who can assist during an emergency. Local representatives can become an indispensable resource, especially in a non-English-speaking country. An all-in-one insurance package offers essential support for many different situations and provides peace of mind.
Lesson 2: Read all travel documents prior to departure
Travelers are issued several documents when they purchase travel insurance, but not many individuals take the time to look at the documents provided by their travel company. It is important to read and understand this content. The information listed in the fine print might seem insignificant amid the excitement of an upcoming vacation, but these papers can prove extremely valuable during a crisis.
Emergency phone numbers and detailed coverage explanations are also found in these documents. Travelers should know what is included and remember to take these documents with them on their trip.
Lesson 3: Know the limits on all credit cards
An unexpected health crisis while traveling can cause a great deal of stress, both physically and financially. While insurance packages help cover a majority of medical emergencies, not every situation will be covered. For example, an airlift transport return to the United States could require payment up front as an out-of-pocket expense because waiting to see if insurance will cover the costs is time most cannot afford to wait.
One way to prepare for unexpected expenses is to know the limits on all credit cards. It may be useful to notify credit card companies of any foreign travel plans prior to departure. Carrying an additional card as a backup may be warranted, depending on the limits of each card being used.
Lesson 4: In the event of a medical emergency, contact personal health insurers
Amid the chaos of a medical emergency, it is imperative to contact personal health insurers. Informing a private provider of a situation early on means that provider can shed light on additional coverage and provide another vital line of support.
Keeping calm during an emergency can be difficult, and that stress is magnified while traveling. Private providers can aid travelers with expert assistance and provide additional resources. The assistance of the travel insurance plan and a private provider can see travelers through the unexpected.
Lesson 5: Carry a list of medications and know the signs of a medical emergency
No matter how far the destination, travelers should carry a list of medications and known illnesses. The list should be kept in an easily accessible location such as a wallet or purse, and travel companions should be aware of the location of the list and what is described on it. Paramedics or doctors will need this list to proceed with proper treatment.
It’s equally important to become familiar with the signs of a medical emergency, especially those that are cardiac related. Should an emergency occur, knowledge and the ability to react calmly and swiftly can be the greatest assets.
Conclusion
By planning for what to do if a serious health crisis occurs, travelers should rest easier knowing they have done all they could to protect and prepare for their trip, thus allowing them to further focus on enjoying their vacation.
This material is derived from sources believed to be reliable, but its accuracy and the opinions based thereon are not guaranteed. The content of this publication is for general information only and is not intended to serve as specific financial, accounting or tax advice. To be distributed only by a Registered Investment Advisor firm. Copyright © 2014, The BAM ALLIANCE.
Stephen High
As the saying goes, the worst lies are the ones we tell ourselves. It’s not that we intend to deceive ourselves. Sometimes, we can have an unhealthy perception of reality, especially when it comes to planning for retirement.
Perhaps it’s because planning for retirement involves risks, and risks entail uncertainty. Uncertainty often leads to fear. For example, in a survey conducted by the Employee Benefit Research Institute (ERBI) in January 2013, 36 percent of the surveyed workers 55 and older reported having less than $10,000 in savings and investments. According to the National Institute on Retirement Security, one-third of all people between the ages of 55 and 64 haven’t saved anything for retirement.
The ERBI survey found that 69 percent of the respondents said they plan to find paid employment once they retire from their primary job. Yet ERBI found that only 25 percent of surveyed retirees had ever worked for pay while in retirement. A similar study published in September 2006 by
Saving for retirement is one of our biggest financial challenges. According to EBRI, the percentage of workers currently saving for retirement has continued to decline to 57 percent from 65 percent as recorded in 2009. We tell ourselves it’s all right to wait, and we tend to think up excuses so that we can avoid facing the long, difficult task of saving for retirement. When we finally tell ourselves the truth, suddenly it becomes reality. That means we have to do something about it, and that is the scary part.
Here are a few of the lies that some people tell themselves that prevent them from reaching a comfortable retirement.
I can always save later, so why start now? Here’s some compelling math on saving $1 million by age 65. According to a 2012 article on retirement by Laura Shin, if you start contributing to a retirement plan at age 25, your savings would need to be around $6,500 a year (assuming a 6 percent growth rate). Shin found that if you don’t start contributing until age 45, “you’ll have to contribute $28,185 a year to get to your retirement goal of $1 million!” Can you afford to do that?
I can live on 70 to 80 percent of my pre-retirement income. Ask yourself: Will you be able to live the life that you want in retirement on 20 to 30 percent less income than you have right now? According to research published in 2006 by EBRI, 55 percent of surveyed retirees said they were living in retirement on 95 percent or more of their pre-retirement income. To prepare for your retirement, you should make a detailed projection of spending in retirement. Start with your current annual expenditures, subtract expenses that you will not likely incur in retirement and add expenditures that you will likely sustain, such as additional healthcare costs.
I won’t need long-term care. A study published last year in the health journal Inquiry by the Lewin Group, along with professors at
I can rely on Social Security. About one-third of households live on Social Security alone, according to the Center for Retirement Research at
It is not easy to plan for retirement. But if you can overcome the fears that prevent you from planning, you will be on a better path toward financial freedom.
Copyright © 2014, The BAM
Point 1: Markets Are Efficient
Public information is of little fundamental value. New information is so quickly incorporated into asset prices that use of this knowledge cannot be expected to consistently yield superior risk-adjusted returns.
Point 2: Risk and Expected Reward Are Related
Investors who expect or need to achieve higher returns must accept the associated risk. Equity-like returns do not come without commensurate risks. There is no promise of high returns without high risk.
Point 3: Diversification Works
Global diversification across a variety of imperfectly correlated asset classes is the most effective way to reduce risk. Diversification is always working, whether we are pleased with the immediate results. Diversification should be thought of as the equivalent of buying insurance against having all of one’s investment eggs in the wrong basket.
Point 4: Markets Are Unpredictable in the Short Run and Even in the Long Run
In the long run, we expect that equity markets will rise more than fall. Individuals who correctly predict short-term market movements should likely attribute their results to luck rather than skill.
Point 5: Discipline Is Key to Successful Investing
For far too many investors, the variable that ultimately determines the results of their portfolio is not investment returns but investor behavior. Emotions can lead investors to make poor decisions at the wrong times. It is easy to remain disciplined during bull markets. However, it is far more important to do so in bear markets and avoid the far-too-human propensity to sell at market bottoms.
Summary
No matter where your plan goes, we will continue to place importance on evaluating risk tolerance, building a globally diversified portfolio and implementing regular, disciplined rebalancing techniques. Having such knowledge changes the way you approach investing.