By Jason Alderman
Senior citizens and others living on a fixed or low income know how difficult it is to make ends meet, especially when costs for essentials like health care, food and energy increase faster than their sources of income.
Here are a few cost-saving benefits available to people on fixed incomes – especially seniors:
Prescription Drug Assistance Programs. Most pharmaceutical companies offer patient assistance programs (PAPs) that provide uninsured and low-income people access to prescription drugs they couldn’t otherwise afford. Ask your doctor, pharmacist or health clinic for details. Other good resources include: Medicare’s alphabetical list of drugs available through PAPs, with links to detailed eligibility information (www.medicare.gov/pap/index.asp); Partnership for Prescription Assistance (www.pparx.org); RxAssist (www.rxassist.org); and NeedyMeds (www.needymeds.com).
Other money-saving ideas for medical expenses include:
- Government-provided programs that help people with limited income and resources pay for medical coverage, including Medicaid and Medicare. For a good round-up of these programs, go to www.medicare.gov and click on “Get Financial Help.”
- Ask your doctor about using lower-cost generic drugs and providing cash discounts for expenses not covered by your insurance.
- Several provisions of the recently signed health care reform bill will gradually reduce Medicare drug costs between now and 2020. For example, this year seniors who reach the so-called “doughnut hole” coverage gap ($2,380 in 2010) will receive a $250 rebate to lessen the financial burden.
Tax advantages. The IRS tax code includes several benefits that target seniors (and often, other lower-income taxpayers), including:
- A higher standard deduction amount for most people who don’t itemize deductions, if they and/or their spouse are over 65 or blind.
- An additional tax credit for lower-income people who are over 65 or disabled and file a 1040 or 1040A tax form. (For full details and eligibility, see IRS Publication 524 at www.irs.gov.)
- Certain home improvements made to accommodate medical conditions or disabilities with a doctor’s recommendation may be deducted if you itemize deductions. Rules are complex, so read IRS Publication 502 at www.irs.gov and consult a tax advisor before claiming such deductions.
- Free tax return preparation assistance and counseling from IRS-trained volunteers is available to people over age 60, as well as low-to-moderate income folks and military families (search “Free Tax Preparation” at www.irs.gov).
- Publication 554 contains additional help for seniors when preparing their tax returns.
Government programs. Many government-sponsored benefits, grants and financial aid programs exist to help seniors, low-income families and others pay their bills, including:
- LIHEAP, the Low-Income Home Energy Assistance Program, which provides grants to help pay utility bills. To see if you qualify, go to www.acf.hhs.gov/programs/ocs/liheap.
- SNAP, the USDA’s Supplemental Nutrition Assistance Program (formerly known as food stamps), helps millions of lower-income Americans buy nutritious food each month. Visit www.fns.usda.gov/snap for qualification requirements.
- Rental assistance for low-income families is available from several U.S. Department of Housing and Urban Development programs as well as other state and local agencies (see www.fns.usda.gov/snap for details).
- Go to www.usa.gov/Citizen/Topics/Benefits.shtml for a comprehensive overview of additional aid programs.
And of course, don’t forget to ask about senior discounts whenever you shop, travel or buy insurance – 10 percent here and there can really add up.
Jason Alderman directs Visa’s financial education programs. To Follow Jason Alderman on Twitter: www.twitter.com/PracticalMoney
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