Read the Fine Print
Posted on March 6, 2005 10 Comments
To follow up on a few previous posts, two incidents occured this week that left me wincing. The first had to do with my student loan consolidation. If you’ve been following the site, you’ll know that I recently consolidated my 12 outstanding student loans and got a great fixed rate – 3.5 percent – for the remainder of the loan. Read about it here:
http://budgetingbabe.blogspot.com/2005/02/student-loan-consolidation.html
I received confirmation in the mail this week and – much to my excitement – I also noticed that my monthly payments have decreased by $50! I believe I squealed with delight at that moment, until Brian unceremoniously asked me how that was possible. After reading the fine print, I realized I had simply changed the DURATION of my loan and extended my payments to 2015 (they would have been done in 2011 without consolidation). Argh! That wasn’t what I wanted to do!
But this is not actually a cause to panic – just something for us Budgeting Babes to be aware of. If I keep paying my regular monthly payment prior to consolidation, I should still finish in 2011; possibly even earlier because I’ll be paying off more of the principle each month. In the end, consolidation is still a great idea to consider because the loan rate is still so low.
The next event (one that really is a cause for panic) involves my horrible wisdom teeth. Stupidly, I never actually asked the full price for pulling four bony-impacted teeth. I paid $250 upfront, and the office told me they’d deal with my insurance to cover the rest. Great! I knew that my dental insurance covers 50 -80 percent for each wisdom tooth, and assumed the $250 was my estimated leftover payment.
Wrong.
I got a notice from Atena this week that they’ve put in a “request for more information” regarding the total bill – a whopping $1,158 (more than my paycheck and almost half my current savings!). Whoops. Now the dental office has 45 days to provide the information and if not, the claim will be denied – at which point I can appeal. I assume the office will send out the information in time, but that still may leave me with about $500 in charges. Way more than I thought I had to pay.
Readers, learn from my mistakes! Always, always read the fine print (ie. ask for FULL payment information when dealing with medical expenses). I only have myself to blame for my new $500 bill – I didn’t do the proper legwork of calling my insurance provider and asking about potential costs – but I honestly thought the doctor’s office would have told me what I should expect to pay. Naive, naive. Next time I’m going for full disclosure before the procedure – no more waiting around to find out my bill.
***
Great purchase update:
I picked up my framed print this weekend and I love it. It’s probably the nicest thing I own and I got the whole thing for 50 percent of (nevermind that the frame was probably 1000 times more expensive than the print itself!)f. Judging by your comments, I can tell that many of you are also baffled at the often ridiculous price of framing. However, if you can get a deal on it, such as the Michael’s framing special (and you don’t have to buy it on credit!), a framed piece can really brighten up your place.
New budgeting book alert:
Suze Ormon has a new book out: Young, Fabulous and Broke! I do love her no-nonsense approach to finances and I frequently reference her Ask Suze! books when I come across terms I don’t recognize. Rent it from the local library when it comes around or put it on your wish list. (I bet parents of most Budgeting Babes would get a kick out of buying this book for their daughters.)
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March 7th, 2005 @ 2:08 am
If you ever have to do something like this again, you should consider requesting a treatment plan from your dentist and a pre-authorization from your insurance company to see what they will actually pay. Many insurance companies pay a percentage of what they call “reasonable and customary” charges. For example, if your insurance says they pay 80% of a crown, and your bill is $1000, they may say reasonable and customary charges for a crown is $800, so they will pay 80% of that ($640), leaving you with the other 20% ($160) plus the amount that’s over what they consider reasonable and customary ($200).
Also, that’s a real bummer about your student loans. A lot of people make the same mistake when they refinance their mortgage. They think they are saving tons of money every month, but they will be paying on the loan a lot longer.
I’m glad you like the way your print turned out!
erin
http://www.frugalgirl.blogspot.com
March 7th, 2005 @ 3:29 am
I just had something similar happen…an unplanned (it was just supposed to be a cavity!) root canal at the very end of the year popped some limit I didn’t understand. So I had a balance for the root canal and I had owed a deductible on having two small cavities filled within the month.
All this after not having anything but cleanings and checkups for 20 years so I was unprepared to have to pay anything for dental visits.
I have incredible health insurance through my employer, so I took it on faith that most of my dental stuff would be covered too…but some of the benefits are somewhat puny.
I was able to work something out with my dentist, but it still ended up costing me several hundred dollars at my most cash strapped time.
I’ll be taking frugal girl’s excellent advice next time (well, I hope there isn’t a next time…)
March 9th, 2005 @ 3:41 pm
Be sure you are paying on the principle on your student loan. I thought I was paying on the principle and after several phone conversations and several incompetent customer service reps got down to the bottom line…there was no way to pay on the principle. I was so disgusted that I decided to pay off the loans and be done with what I thought were some shadey, if not, unethical practices.
March 10th, 2005 @ 3:05 am
I recently consolidated my student loans through Graduate Leverage (www.graduateleverage.com), an intermediary debt consolidator. Its run by a couple of Harvard Business School grads who survey the world of debt consolidation companies and pick the best one for you to work with. You pay nothing extra – Graduate Leverage gets a cut from the ultimate consolidator for refering them a large volume of business. The GL guys came and spoke at my business school and were very impressive.
I recently (Fall of 2004) locked my loans at 2.875% for 25 years. I am glad to have such a long repayment period. Consolidating student loans is the one place in the world of finance where taking a longer term doesn’t mean a higher rate. As rates have ticked up, I can already earn more that 2.875% in a money market, so why would I ever want to pay this back more quickly than I have to? The best part of the process was being able to call GL and actually speak to a real human being, one of the principles, in fact, every time I had a question.
September 13th, 2005 @ 1:26 pm
Your blog is great! It’s hard to find blogs with good content and people talking about debt reduction these days! I have a secret debt reduction blog if you want to come check it out!
October 1st, 2005 @ 6:50 pm
Nice blog. Please check out my consolidating debt blog. It is all about consolidating debt.
October 2nd, 2005 @ 2:44 am
Thanks for some ideas. I have a site about south carolina debt consolidation and I’m just surfing Blogger looking for ideas. Thanks again
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October 3rd, 2005 @ 4:57 am
Excellent post!
Debt Free Guy
debt consolidation
September 22nd, 2009 @ 7:03 am
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