A new diagnosis or a history of a serious health condition adds an additional factor to consider when deciding whether to become self employed or to continue being self employed, and, if so, the best way of continuing to be self employed. (If you have one or more employees, read: Small Business Owners).
If you are considering becoming self employed
Whether your diagnosis has started you thinking about becoming self employed, or it's a thought that's been in the works for some time, don't let your health condition keep you from considering this option. The key is whether you are physically and mentally up to it and whether you are a good candidate for self-employment.
Your health history makes it all the more important that you become educated on the subject of being self employed before going off on your own.
- While nobody can predict what will happen to any individual, it would be helpful to know your prognosis (a doctor's estimate of what will happen to you) before going off on your own.
- If you would lose your health insurance by becoming self emloyed, if your insurance is through an employer, you are likely to be able to continue it through COBRA. If not, because of the Affordable Care Act ("Obamacare") you can get individual health insurance despite your health history. If you hvae a gap without health coverage, there are techniques for obtaining health care while uninsured. (For information, click here.)
- If you are physically disabled, there may be assistance available for free to help you get started.
If you are self employed
Planning can help to avoid unpleasant surprises, help you gain a feeling of control, and can help you successfully navigate the shoals.
One of the first decisions is whether to disclose your health condition to clients/customers, as well as how to get through the initial period of treatment decisions and then treatment itself.
Next look at such matters as:
- How to keep and maximize use of your health insurance, or obtain it if you do not have it. (As a general matter, 100% of health insurance premiums are tax deductible for people who are self employed). Also look at how to get health care while uninsured.
- How to handle your workload on a continuing basis. If you are not or will not be able to handle it yourself, this may be the time to bring in help, make an arrangement with a colleague, sell the business, or go to work for someone else, such as a large corporation or the government.
- Even if you will be able to handle your work load, this may be a time to consider working for someone else. Would you make more money, have less stress, get more satisfaction, and get useful benefits? You cannot be asked about your health history when applying for a job. To learn more about seeking work, click here. To learn about changing careers, click here.
- Should you continue marketing efforts? Accept new clients/customers?
- If you have available money, store it in a retirement plan that is protected from creditors. You may have to pay a penalty to withdraw the money, but at least your money is protected. A vairety of types of retirement accounts are available to self-employed individuals. To help determine which is best for you, consult a pension professional, your accountant or lawyer. As you review each plan, keep in mind that you may want to withdraw money to pay for medical expenses or to provide a source of funds if you become unable to work.
- If you have a lot of extra money, consider purchasing life insurance. You likely still can despite your health condition. In addition to increasing the amount you ultimately leave to loved ones, life insurance can provide a source of cash now, while you are still alive. To learn more, see: Life Insurance, New Uses Of Life Insurance)
- If you experience a financial crunch or crisis, postpone non-essential creditors. People tend to think of insurance other than health insurance as non-essential during a financial crunch. However, this is not a time to let insurance lapse and then have an unsustainable financial loss.
- Plan for having an income if you become unable to work (disabled) "just in case."
- While planning for the "what ifs," it is advisable to plan in case a natural disaster occurs.
- Step 1. Create a "Just In Case" Business Plan. Include what to do about your health condition in the event of a disaster.
- Step 2. Before you put a "Just In Case" plan in place, test it.
- Step 3. Confirm that you have the insurance you need.
- Step 4. Learn how to file an insurance claim in case you need to and no longer have access to your office.
- If you decide to close your business, ask your lawyer and accoutant to help you unwind the business in the best way from the perspective of keeping costs down, obligations fulfilled, and tax benefits maximized.
- Think about setting aside a block of time to focus on these matters. Setting a date on your calendar can help avoid procrastination. It is advisable to ask your business advisor, accountant and/or attorney to help with the planning.
- Keep in mind that the projection of a positive, can-do, attitude is important for the sake of your clients. (Adopting this attitude in your life will also help maximize your health care). Keep in mind your need for rest, activities to make stress livable, exercise and proper nutrition.
- Last, but not least, consider seeing a therapist for both financial and emotional reasons.
- On the financial side, a self employed person is just as eligible for employee related benefits such as Social Security Disability Insurance (SSDI). if you should stop working and can otherwise qualify for a private or governmental disability income, a licensed therapist can help support a finding that you are "disabled." In turn, this triggers benefits such as SSDI.
- On the emotional side, a diagnosis of a serious health condition is a major blow which starts an emotional roller coaster which can show up at unexpected times, even years after a diagnosis. A therapist can help you cope with your emotions, and help remove emotions from business and other decisions you face from time-to-time.
- Last, but not least, consider what will happen to the business if you become unable to work (disabled) or die. Perhaps a colleague or friend/family member can continue it.
Each of these subjectss is more fully described in the articles listed below in the following articles. NOTE: Free one-on-one counseling is available locally through the Small Business Association to help entrepreneurs plan and manage a small business. For information, call 800.827.5722 9-5ET or e-mail firstname.lastname@example.org
- Definition of Self Employed
- Becoming self employed
- Disclosing Your Health Condition
- Health Insurance For People Who Are Self Employed
- How To Get Health Insurance If You Are Self Employed
- Disability Income Coverage For Self Employed Or Small Business Owner
- Tax Deductions For Insurance Premiums For People Who Are Self Employed
- Your health
- What If
- Selling The Business