The Cost of Braces Takes a Bite Out of Our Financial Plan

A recent visit to the orthodontist confirmed my fear–my daughter will need braces.  Actually, braces seem to be the norm for most kids these days.  Both my wife and I had them growing up, and many of my kids’ classmates have them.  The good news is there is no rush to put them on as my daughter has yet to lose all her “baby teeth.”  Once all the permanent teeth have come in we’ll plan to put braces on to hopefully correct an overbite, and give her an even more beautiful smile.  Obviously, the news doesn’t help my efforts to get out of debt and build a healthy emergency fund. Over the last day or two I’ve had time to digest the news and devise a plan of attack.

Our Plan of Attack

Fortunately, our dental insurance should pick up the first thousand dollars, leaving us another couple thousand dollars to save.  Since we have a few months to save for the expense, I immediately opened a subaccount at ING Direct to beginning funneling some money there from each paycheck.  Determining how much is the hard part.  If we have six months to save I could simply divide the total expense by 12 (since I’m making a deposit there with each biweekly paycheck), however I don’t know have a good feel for how long we may have to save.  So in this case I’ll take a more aggressive approach and save a little extra.  After all, we can always return the money to the debt snowball plan if we save too much.

We Could Use Our Flexible Spending Account

I participate in a flexible spending account (FSA) through my employer to account for copays, deductibles, etc.  However, the idea of dropping my yearly paycheck by $3,000 doesn’t really appeal to me because in the same time I may be able to simply save up the same amount of money in cash, and earn a little interest along the way. FSA’s are deducted from my pay on a pre-tax basis, which could lower my taxable income reported for tax purposes, but I’m not sure it is really worth the hassle factor.

Finance the Amount with Orthodontist

We could finance the cost of braces directly with the orthodontist. In our case, this isn’t really an option because we are committed to taking on no new debts, even for braces. Putting the braces on a credit card, taking out a personal loan, or using the orthodontists in-house financing just does not appeal to us.

In the end it appears saving biweekly amounts in our online savings account best aligns with our current financial strategies (keep it simple, no new debt!). Like other decisions we’ve made with money, it may not make the most sense mathematically, but it makes the most sense personally.

Photo courtesy of lanuiop