How to Get Finances in Order After a Cancer Diagnosis
- The financial toxicity of cancer can wreak havoc on our budgets. Professionals recommend taking stock of finances after a diagnosis to determine what can be paid, what should be put on a payment plan, and when to seek help (through a social worker or patient organization) with paying for medical bills.
- Finance experts also recommend getting some legal documents in order after a diagnosis, such as a will or, if you have many assets, a trust.
- Those feeling financial pressure after a diagnosis should be reassured that there are experienced professionals out there who can help. Many cancer centers employ social workers or patient advocates who can help with financial planning and help determine if you are eligible for financial assistance.
While financial planning may be the last thing you want to think about after a cancer diagnosis, experts recommend taking a few important steps for peace of mind.
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Cancer treatments are expensive, even with insurance. Some people lose income because they’re unable to work and/or must pay for childcare while undergoing treatment. Even the cost of parking at the hospital can add an extra burden to any available funds. Often referred to as the financial toxicity of cancer, it can take a toll on anyone's budget.
A diagnosis can also serve as an impetus to get important financial matters in order and to think about our long-term finances.
Paul Karger, co-founder and managing partner of TwinFocus, a premier financial advisement firm with offices in Boston and London, spoke with SurvivorNet about financial steps people may want to consider when they’re diagnosed with cancer.
Budgeting for Treatment Costs
When it comes to paying for treatment, the bills can feel overwhelming. While there are resources that may help in some cases, Niv Persaud, managing director at Transition Planning & Guidance LLC, in Atlanta, Ga., said there are some other steps those diagnosed with cancer may want to take, including:
- Calculate deductibles and estimated out-of-pocket costs for medical treatment.
- Total the amount you have available in your emergency reserve, health savings account, and flex spending account.
- Tighten your budget by reducing or eliminating non-essential expenses. Look at money spent on shopping, food delivery, entertainment, subscription services, etc.
- Review your payroll deductions and reduce or eliminate those that are optional where it makes sense. Some pre-tax deductions will have minimal impact on your take-home pay. Before making any changes, ask your HR contact to calculate the impact.
Should you ever borrow from a retirement plan to pay for treatment? Karger said there are no hard and fast rules.
“Personally, I think when you’re faced with a life-threatening illness, your health is number one,” he told SurvivorNet. “You do whatever you have to do.”
People struggling to pay for cancer treatment also have a few options to get help with medical bills. Many cancer centers have social workers or patient navigators on staff who can help patients navigate finances, work out payment plans, and look into whether they are eligible for any financial assistance programs.
Should I Make a Will?
No one likes to think about what will happen when they’re gone, but a will, which is a legal document that outlines how you want your assets distributed and affairs managed after you die, can save your loved ones time and money and make sure that your wishes are honored. When facing a diagnosis, Karger says there are three important designations to make.
Personal Representative/Guardian
This involves choosing someone who can close your estate if you pass away. It could be a spouse or a mature, responsible child. Karger says in many cases people will name the attorney as the representative.
If a person has minor children, another thing to consider is a guardian. Karger encourages people to inform/ask the people they’re designating as a guardian so there are no surprises.
Health Care Proxy
This is a person the hospital can call on to make decisions about your health care and treatment. Karger said this is often a spouse, adult child, or good friend, but that it should ideally be someone that’s in close proximity to where you live.
Durable Power of Attorney
You want to choose someone who can make financial decisions on your behalf should you become incapacitated. It should be someone who is financially savvy and may not be the same as your personal representative or healthcare proxy.
Beyond a Will, Consider a Trust
Beyond a will, if you have more than average assets, such as retirement accounts, property and other investments, you may want to establish a revocable trust. Karger says this is a more involved document than a will. You can change its terms while you’re alive, but upon a person’s passing it becomes irrevocable, meaning it can’t be changed. It, unlike a will, is a way to avoid probate court, and assets are immediately transferred to those whom you name. Note, however, that trust rules vary by state.
“The big thing is thinking about who you want to represent you in these various capacities,” Karger told SurvivorNet. “And the beauty of all these estate planning documents is that they’re all revocable, so you can change them anytime. The important thing is to get something down on paper. You can always change it.”
He notes that parents can pay directly into their adult children’s healthcare expenses without tax implications, as those payments don’t contribute to their lifetime gift limit.
What to Do About Investments
If you have investments, you may wonder whether you should be more or less conservative after a diagnosis. Karger says there are differing schools of thought. He says by and large, people tend to get more conservative. They want to keep as much money as possible on hand and aren’t as willing to take risks that may not pay off. Others, however, decide to take as much risk as possible in an attempt to maximize what they leave for the next generation.
In other words, there’s no right or wrong answer. It’s largely a matter of personal preference and individual circumstances each individual should weigh. A professional financial advisor can help.
How to Get Help Paying for Treatment
Many financial resources are also available to cancer patients to help cover costs for treatment, transportation, drugs, and other related expenses. Knowing how to find them, however, can be overwhelming after a diagnosis.
Sara Goldberger, president of the Association of Oncology Social Work (AOSW), said oncology social workers can help. Many people, however, don’t know to ask if a social worker is available to them and aren’t aware of the resources they can help them find.
“There are a wealth of organizations and opportunities to help people with the costs of cancer,” Goldberger said. “Obviously, it’s a very deep well of need, and there’s not help for everyone in every situation, but knowing to ask is so important for patients and families.”
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She said state and federal programs like Medicare, Medicaid, and unemployment exist, and many people don’t know they’re entitled to them. Hospital foundations also raise money for patient assistance, advocacy groups provide support, and pharmaceutical companies sponsor patient assistance plans that provide free drugs or funds to help with copays. A social worker can help patients find programs they qualify for.
She said if a social worker isn’t available through your care center, she would encourage people to reach out to the advocacy community. National, regional, and local organizations can help patients find the resources they need.
“Being your own best advocate is so important,” she said.
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