Pet owners across America are more likely than not do anything for their pets, including shelling out hundreds — if not thousands — of dollars to cover potential medical bills due to a pet-related emergency. Some of those bills can certainly build up, and, if not properly prepared, can leave pet owners in serious debt.
NerdWallet Personal Finance Expert Kimberly Palmer joins Yahoo Finance to discuss how pet owners can avoid going into debt due to hefty vet bills and animal care costs.
Palmer shares insights into the affordability of pet insurance plans:
“The important thing to know is that you can often buy pet insurance at a relatively affordable price. So, for example, the average cost for pet insurance for a dog is about $53 a month. It’s important to know, however, and this is something that surprises many pet owners, the price of your pet insurance actually increases as your pet ages. And at the same time, due to inflation, we see the price of pet insurance continue to rise animal… But it’s definitely more affordable than if you suddenly have to pay for unexpected medical bills because your pet may have been injured or needs some kind of medical care.”
For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.
Editor’s note: This article was written by Nicholas Jacobino
Video Transcript
[AUDIO LOGO]
RACHELLE AKUFFO: Will you borrow for your furry friend? Well, a quarter of people will do that to get life-saving medical care for their pets. That’s according to a NerdWallet report and a USA Today survey that found 91% of dog owners have experienced financial stress over the costs of owning a pet. But there are ways to keep your pet and wallet healthy. To break it down for us, here’s Kimberly Palmer, NerdWallet personal finance expert.
Good to have you on the show here. It seems a lot of people underestimate how big some of these health-related costs can run up for pets at a time when people can barely afford to prepare for a $250 emergency. What do people need to know about it?
KIMBERLY PALMER: The really difficult thing about pet care is that you never know what to expect, you never know if your pet will get sick or hurt. And the time to buy pet insurance, which can help you manage those costs is before your pet needs it.
And so it’s really important for people to consider, what do you expect? Do you want to go with pet insurance, if your pet needs some medical care or do you want to pay for yourself? And in some cases, risk even jeopardizing your own financial situation. As you mentioned, people are willing to do a lot for their pets, including going into debt. And that can be really difficult for pet owners.
RACHELLE AKUFFO: But you think if people are willing to go into debt, why don’t they get insurance. Compare some of the costs that people might be looking at monthly if they have insurance versus some of the costs, I know anecdotally for me my dog ate a piece of chewing gum and was allergic to it. 9,000 later, but if you don’t have pet insurance, that’s an upfront cost you have to bear.
KIMBERLY PALMER: That’s a good example of the unexpected costs that can really come up for pet owners. The important thing to know is that you can often buy pet insurance at a relatively affordable price. So for example, the average cost for pet insurance for a dog is about $53 a month. However, it’s important to know and it’s something that surprises many pet owners.
The price of your pet insurance actually goes up as your pet gets older and at the same time due to inflation, we see pet insurance prices still going up. And so pet insurance isn’t cheap, but it’s definitely more affordable than if you suddenly have to pay for these unexpected medical bills because your pet might be injured or need some medical care.
RACHELLE AKUFFO: As you look at some of the more expensive things that some of this pet insurance does and doesn’t cover, what do people need if they think, I have pet insurance that covers me because there are some outside costs that is also an addition.
KIMBERLY PALMER: there is. What is very important to know is that generally, you will pay for a deductible when your pet needs care. And then the pet insurance starts to cover a percentage of the remaining cost. So that’s why it can make those costs more manageable.
But one important thing to know is that pet insurance generally does not cover pre-existing conditions as well as health care. Unless you add that to your pet insurance, which of course, makes it more expensive. And so the tricky thing for pet owners is that if you know your pet needs some care because it’s sick for example, it’s probably too late to get pet insurance at that point because with that exception of the pre-existing condition.
So much for pet owners to consider.
RACHELLE AKUFFO: And so when you think about that cost compared to all the other costs that people have to accept at a time when inflation is starting to moderate but still very high for some of these costs, how should one think people talk about including some of these costs. So that they are not surprised if there is an emergency with their pet?
KIMBERLY PALMER: That’s really the important question and this is why it comes down to an individual decision. So what you want to do is weigh the risk of suddenly being faced with some big ticket items due to medical care for your pet versus taking out pet insurance now, perhaps when you first get a pet. animal and you’re checking what risk I’m willing to take.
You can save money on your own and budget in advance for expenses that may arise or you can turn to pet insurance where you pay a monthly fee, an annual fee. And then you can go for pet insurance if you need it when your pet needs some medical care. So it’s something to weigh the pros and cons of, think about your budget and what can fit into it.
What you don’t want to do is put yourself at risk and take on debt that’s really hard to handle because it can lead to more financial stress down the line.
RACHELLE AKUFFO: That peace of mind premium is definitely worth the cost if you can afford it. I appreciate that you broke that down for us. Kimberly Palmer, NerdWallet personal finance expert. I appreciate your time. Have a great weekend.
KIMBERLY PALMER: Thank you
