Is it financially irresponsible not to have any form of health insurance?

Question

Rich Dad · Accepted Answer

Skipping health insurance is like skydiving without a parachute because you "probably won’t need it." Sure… until you do.
Let me be bold: going without any form of health insurance is not brave — it’s financially reckless unless you have serious assets backing you up. I’m not talking about $5,000 in savings. I’m talking $250,000+ liquid, accessible, and not tied up in your cousin’s crypto project. One hospital stay in the U.S. can run $20,000–$100,000. A broken leg? $7,500. Appendicitis? $30,000. Cancer treatment? Six figures fast. That’s not a “bad month.” That’s a wealth reset button.
Now, do I love traditional insurance? No. Insurance companies aren’t charities — they’re actuarial machines. But smart wealth builders use insurance strategically. Think of it as catastrophic risk transfer. I don’t insure paper cuts; I insure disasters. High-deductible health plans (HDHPs) paired with an HSA can be powerful. You might pay $300–$500 per month, but that HSA grows tax-free. Max it out ($4,150 individual limit in 2024), invest it, and over 20 years at 8% returns, that’s roughly $200,000. That’s not just protection — that’s an asset.
Entrepreneurs sometimes gamble here. I’ve seen it. A 28-year-old startup founder skips insurance to "save" $4,000 a year. Then a skiing accident wipes out $60,000 in cash. That’s 15 years of “savings” erased in one afternoon. Meanwhile, another founder pays for catastrophic coverage only, keeps costs lower, protects downside, and keeps building assets. Guess who stays in the game longer?
Now here’s the nuance: if you’re young, healthy, no dependents, strong cash reserves, and live in a country with public healthcare safety nets, the calculus changes. But even then, the wealthy insure against what they can’t comfortably absorb. You don’t build an empire on optimism alone — you build it on asymmetric risk: limited downside, unlimited upside.
Here’s the real issue: medical debt is one of the top causes of bankruptcy. Bankruptcy doesn’t just hurt your pride — it wrecks credit, borrowing power, business expansion, real estate deals. If you want to invest in rental properties or secure business lines of credit, you need financial stability. Lenders don’t care that you were “healthy until you weren’t.”
So no, insurance isn’t exciting. It won’t make you rich. But it prevents you from getting wiped out — and in wealth building, survival is step one.
If you want to take risks, take them in assets — not in emergency rooms.
“Self-insure only when you’re rich enough to write your own bailout check.”

Poor Dad · Answer

Being uninsured is like driving without a seatbelt because you’ve never had an accident — it only feels smart until it isn’t.
I’m going to say this clearly: yes, it is financially irresponsible for most people not to have health insurance. Medical costs are unpredictable and can be devastating. According to recent data, over 60% of personal bankruptcies in the U.S. involve medical debt in some form. Even a short hospital stay can cost more than a year’s salary for many workers. That is not a risk most households can absorb.
Think about your monthly budget. If you earn $60,000 per year, that’s $5,000 per month before taxes. Now imagine receiving a $40,000 hospital bill after an unexpected emergency. That’s nearly a full year of gross income. Even if you negotiate it down by 30%, you’re still facing a crushing burden. And unlike a car or house, you can’t simply return medical care once it’s delivered.
Some people argue they’re young and healthy. But health events are often random. A car accident, appendicitis, a sudden diagnosis — these aren’t lifestyle choices. I once knew a healthy 32-year-old colleague who needed emergency surgery. He had skipped insurance for three years to save roughly $12,000 in premiums. His hospital bill? Over $85,000. It took him nearly a decade to financially recover.
Now, I understand the counterargument. Premiums can feel expensive — $400 to $600 per month for individual coverage is not trivial. But that’s the price of stability. Insurance is not an investment; it’s protection. Just like home insurance, you hope you never “use” it. The goal is peace of mind and protection of your savings, retirement contributions, and credit score.
If cost is the concern, consider alternatives: employer-sponsored plans, government marketplace subsidies, Medicaid (if eligible), or at minimum a catastrophic plan. Even a high-deductible plan is better than nothing. And if you have dependents, the responsibility multiplies. One medical crisis could jeopardize not only your future but your family’s security.
Financial responsibility isn’t just about growing wealth. It’s about preventing disaster. You work hard for your savings — don’t leave them exposed to a single unexpected event.
“Hope is not a financial plan — protection is.”

Is it financially irresponsible not to have any form of health insurance?

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