I went to Malaysia two weeks ago to hang out with my friend. He has been staying in Johor for a while and thought it would be a good idea for me to visit palm oil plantations near Kota Tinggi.
The thunderstorm in the afternoon kept us, two cats and one dog, in the house for a while. I took that opportunity to update him on the changes to the healthcare system and what they mean to his financial situation.
There have been changes to how our health insurance works. If you buy some shield plan and rider, you must co-pay about 5-10% of the bill. If you wish for a larger budget for cancer treatment, you will have to get a rider. A rider is not just to reduce out-of-pocket expenses in general anymore.
We then discuss whether he has a good plan if a major illness hits him today, tomorrow, 20 years from now, or 40 years from now, for a semi-financially independent person.
Knowing what I know, there are gaps in his coverage. He has an advanced-stage critical illness plan up to 65 years old. If a major illness hits him in the later years, that expense will come from his income portfolio for his daily living.
“How would I know if my income portfolio can provide for that? It sounds like it might be a big sum for a period!” He is right, and there are most likely trade-offs. Some of his daily spending will have to be cut down, and even then, how much are we talking about whenever that happens?
A solution for this is to buy a critical illness till 99 years old, but that is not foolproof, in my opinion. If you need a one-time
