With the cost of cancer treatment rising every year, finding cancer treatment funding can be a daunting task. While most people are aware of the larger foundations and non-profit organizations that offer financial support for select cancer patients, they may not know about the numerous alternative resources available to help families cover the cost of care. Here are just a few of the under-the-radar options.
Homeowners may be able to leverage their real estate into funds usable for treatment. If they meet certain qualifications for income and/or equity – that is, the difference between the estimated market value of the home and the amount they must still pay – homeowners may qualify for refinancing a mortgage, a home equity loan, or a second mortgage.
Another option is a reverse mortgage, where a homeowner signs over their home’s deed to a lender. The bank then pays a fixed monthly amount – a reversal of the typical mortgage payment – and they continue to live in the house until the money runs out. This can be a solid option for cancer patients who need additional funds, but would prefer to live in their own homes for the rest of their lives. Most reverse mortgages do not require a certain income standard, but there are certain qualifications that must be met – one of which being that the homeowner is 62 years of age or older.
Selling a home on the open market is also an option. While there are typically tax consequences – and the process of selling a home and moving can be stressful – the proceeds from the sale can be higher than those received from a reverse mortgage.
Medical crowdfunding is an option for those who feel comfortable accepting financial support from their friends, family members, and loved ones. This option involves signing up for a crowdfunding site, explaining the patient’s need for treatment funds, and sending the link to friends and acquaintances who are likely to make contributions to the treatment costs. Popular crowdfunding websites include youcaring.com, gofundme.com, and plumfund.com. They typically keep a small percentage of contributions to offset their operating costs. Make sure you know how much the site you choose will keep before signing up for a crowdfunding campaign.
Pensions, 401(k)s, and individual retirement accounts (IRAs) can be a financial resource for many cancer patients – but liquidating these accounts before the age of 59½ carries a 10% penalty in fees to the Internal Revenue Service and is taxable on both a federal and state level. Another option is to take out a loan secured by these accounts’ cost value; while there will still be fees and monthly payments, it will likely be less costly than cashing out the accounts too early.
Almost every life insurance policy can be turned into usable funds. Many life insurance policies include an Accelerated Death Benefit (ADB) provision, which allows a terminally ill person to receive a portion of their life insurance money while they are still alive. Depending on the policy, the ADB may be available to someone with a life expectancy of six months to two years, and the insured can usually receive 50 to 80 percent of the policy’s value. Keep in mind that confirming medical qualification for an ADB can be difficult and time-consuming.
Patients can also try to sell their life insurance policies through a viatical settlement, in which the ownership of the policy passes to one or more third party companies. Or as an alternative to viaticals, programs like Fifth Season Financial’s Funds for Living and Giving (FLAG) Program can use the policy as collateral for an advance, allowing patients to maintain ownership of the policy, receive a portion of its value today, and preserve funds for beneficiaries to receive in the future. Nearly any type of life insurance policy can be used for a FLAG advance, including term, whole, universal, FEGLI and group policies from an employer.
To learn more about the FLAG Program and how to leverage your life insurance policy, talk to your financial advisor or contact Fifth Season Financial today. Fifth Season has distributed over $90 million to help clients fight the financial toxicity of a later-stage diagnosis and we look forward to speaking with you at 866-899-2330 or at firstname.lastname@example.org.
Disclaimer: Fifth Season Financial is not a financial advisor or consultant and recommends that you speak to an advisor or expert before making any significant financial decisions.
Relieve financial stress with the FLAG Program, a viatical alternative that uses your life insurance for a cash advance