Joyous. Magical. Momentous. Life-changing. Certain adjectives commonly describe having a child.
Nikki McDermott, a 31-year-old woman in Lake Worth, Florida, learned another one during the conception process: expensive.
After struggling to get pregnant, McDermott and her husband, Mike, were determined to do whatever it took within their financial means to have a family. She took the fertility medication Clomid, underwent $500 in diagnostic tests and tried intrauterine insemination, all without success.
“At that point emotionally, I was like, I can’t keep doing this up and down rollercoaster,” McDermott says. “We wanted something that had a higher success rate, so we did in vitro fertilization.” They were quoted $14,000 for a package including medications and procedures.
At the time, McDermott was on her husband’s employer’s insurance plan, which offered no fertility coverage. To cover the bulk of IVF treatment, the McDermotts took out a $10,000 fertility loan from a lender partnered with her doctor’s office. This offered convenience but came with a sizable interest rate of just under 22%.
The first IVF cycle was successful for the McDermotts, but this is typically the case only for 29.5% of patients, according to a study published in JAMA in 2015; it often takes at least two cycles.
Having her son, Mikey, now a toddler, was worth the emotional and financial stress, McDermott says. “At the end of the day, we pay the monthly fee for the loan, and we just joke around that he can’t go to college,” she says.
Making financial tradeoffs and saving for IVF is the best case scenario, says Shane Sullivan, a certified financial planner with United Capital in Austin, Texas. But for those eager to move forward without adequate savings, financing may be the answer. For the McDermotts, that answer was a fertility loan. Other funding options, detailed below, include loans from credit unions and online lenders, as well as credit cards and health savings accounts.
Understanding the high cost of IVF
McDermott is far from alone. Impaired fecundity, or the inability to have a child, affects 12.3% of reproductive-age women, according to data from the Centers for Disease Control and Prevention’s National Survey of Family Growth (2011-2013). According to the same study, 11.3% of women ages 15 to 44 — that’s 6.9 million women — have received fertility services. Sometimes fertility issues are due to men; according to the American Society for Reproductive Medicine, in 40% of infertile couples, health factors in male partners are the sole or a contributing reason for infertility.
There are many ways to treat infertility, but IVF has grown in popularity, and it’s not cheap. In IVF treatment, sperm and eggs are retrieved and manually combined in a laboratory dish to be fertilized. The embryos are then transferred to a woman’s uterus in hopes of implanting and resulting in a pregnancy.
According to data collected on 3,192 IVF patients and provided to NerdWallet by FertilityIQ, an online resource for those seeking fertility treatments, the national average for one IVF cycle, including drugs and the procedure, cost $19,857. Some doctors offer packages or bundles at a discount, but the costs are still significant.
Why are the bills so steep? Operating a fertility practice is expensive, says Dr. James A. Grifo, a prominent fertility doctor and director of New York University’s Langone Fertility Center. It can cost thousands of dollars per hour for fertility doctors to simply keep their doors open due to the huge expense of highly qualified staff, specialized lab and medical equipment, egg storage, liability insurance and hefty regulatory burdens, Grifo says.
“When you look at any one thing, it’s not a big deal,” he says. “But you add it all up, and pretty soon a patient has to spend a lot of money for it to happen.”
Some states mandate that health insurance cover fertility treatment, but the majority do not, leaving it up to employers to decide whether to offer coverage. Shortly after getting pregnant with her son, McDermott felt like salt was rubbed in her wounds when she learned her husband’s workplace would start offering fertility coverage up to $10,000, just a few months too late for her.
According to the study by FertilityIQ, which involved more than 3,000 patients who received 7,141 IVF cycles in total, 28% had 76%-100% of treatment costs covered by insurance. But 56% of surveyed users had zero coverage, and the remainder of patients had only partial coverage. (Disclosure: NerdWallet CEO Tim Chen is an investor in FertilityIQ.) See the methodology below.
If you do have insurance coverage, be mindful of how you time treatment, says Sullivan, the CFP. He and his wife spent $20,000 on one successful cycle of IVF, but made the mistake of starting treatment mid-year. Because the treatment carried into the next calendar year, he and his wife had to pay their high insurance deductible twice. Sullivan recommends starting treatment in January to avoid this financial predicament.
Due to the high costs, the majority of patients can’t fully afford to pay for IVF out of pocket. According to a 2015 survey of 213 American women who had fertility treatments, which was conducted by MarketCube and sponsored by online lender Prosper, 70% of respondents incurred debt from fertility treatments. Nearly half of respondents (44%) racked up at least $10,000 in debt.
Some patients go to great financial lengths in order to obtain treatment. According to FertilityIQ founders Jake and Deborah Anderson-Bialis, it’s not uncommon to hear of couples who have sold cars and possessions, taken out a second mortgage on their home, sought donations through crowdfunding, or gone broke trying to get pregnant with IVF — and it’s not always successful. Grifo says he’s seen patients invest significant amounts of money in fertility treatment without fully understanding the cost of raising a child, especially when it comes to daycare and preschool, leaving them in a precarious financial situation once the baby arrives.
Because the cost of IVF treatment can be a barrier, those who seek it tend to be high-income earners. According to FertilityIQ’s data, only 4% of fertility patients make $49,000 or less annually. Those making between $50,000 and $99,000 comprise 23% of surveyed patients, and those making $100,000 to $199,999 are 42% of patients. The remaining 31% of patients make $200,000 or more.
This also may be because IVF patients tend to be past their 20s and more established in their careers; only 8% of FertilityIQ’s surveyed patients were under 30. Those ages 30 to 34 comprised 28% of patients, and those ages 35 and 39 were 35% of patients. The remaining 29% were women over 40.
Paying for IVF
In large part, your credit history determines which financing options are available to you. While getting pregnant becomes harder as you get older, age does have a benefit when it comes to your credit: According to data from both Experian and FICO, credit scores usually improve over one’s lifetime. As of October 2016, the average FICO score was 658 for people age 25 to 34 and 685 for those age 35 to 54 was 685. Both are considered average scores.
» MORE: Check your credit score
If you’re seeking IVF treatments, whether you plan to buy a package or pay as you go, here are some of the best ways to pay for it.
Lenders that focus specifically on fertility financing typically partner with doctors’ offices, and you can usually use this type of financing only if your doctor offers it. Fertility-specific lenders may not have the best interest rates, but the doctor’s office typically coordinates with the lender and receives the funds directly, removing some of the headache patients may face obtaining financing on their own. One of the most well-known fertility lenders is CapexMD, which offers loans through participating fertility clinics and preapproves patients within 24 hours. CapexMD did not respond to requests for additional information.
Credit union loans
Many banks no longer offer personal loans, but credit unions typically still do. These personal installment loans have fixed rates with monthly payments. Credit unions are often the best choice for personal loans, as they usually have the lowest interest rates available and can be open to lending to members with less-than-stellar credit. Federal credit unions are required to cap their interest rates at 18%, which is lower than consumers with bad credit would get with other financing options.
The downsides: Credit union loans usually require a lot of paperwork and documentation, and they can take longer to be approved than online options. Additionally, credit unions often require a hard credit check in the application process for you to see your rate, which can temporarily ding your credit. But if you’re able to wait and your credit score can take a minor bump, the lower interest rates can be worth it.
Who it’s best for: Patients who prioritize a low interest rate over speed or patients who have credit issues
Amount you can borrow: Varies by credit union
APR: Typically from 7% to 18%
Term options: Vary by credit union
Fees: Some credit unions require an application fee
Online personal loans
If you can’t get a loan through your local credit union, or if you’re in a hurry to pay for IVF treatment, online installment loans are approved and funded faster than credit union loans, sometimes within one day. Another perk: online loans may have more options than credit unions when it comes to term length and the amount you can borrow. Interest rates are fixed and can be low for those with excellent credit. Patients with credit issues may face steep annual percentage rates. Additionally, some lenders charge percentage-based origination fees, which are based on your credit (the better your credit, the smaller the fee).
Some lenders with experience offering loans for fertility treatments include Prosper, Lending Club and LightStream. Below is a comparison of each. However, numerous other online lenders offer generic personal loans you can use for fertility treatment, and all online lenders have varying terms and underwriting requirements. NerdWallet recommends you compare offers from multiple lenders before signing an agreement. The easiest way to compare actual rates is to pre-qualify online, which entails a soft credit check that won’t affect your credit score.
Who it’s best for: Those looking for approval and funding within days and/or patients with excellent credit
This marketplace lender offers loans online that anyone can apply for, but it also offers loans through participating doctors’ offices. The loan product and interest rate are the same whether you apply online yourself or through your provider. The difference is that in the latter case, your doctor’s office is your point of contact and handles logistics, which can make the process a little smoother. If your doctor doesn’t use Prosper, you can apply online yourself for a general personal loan to put toward treatment costs.
Amount you can borrow: $2,000 to $35,000
APR: 5.99% to 36%
Term options: 3 years or 5 years
Fees: Origination fees of 1-5% depending on your credit
Minimum FICO score: 640
Some doctors partner with Lending Club through a program called Patient Solutions. You can apply online or through your doctor, and these loans may have slightly lower APRs than Lending Club’s regular personal loans because the doctor’s office covers administrative costs that you’d normally pay for as the borrower. If your doctor doesn’t participate in this partnership, you can apply for a general personal loan online through Lending Club to cover your treatments. Terms and rates are based on your financial health, not the loan purpose.
Amount you can borrow: $1,000 to $40,000 for personal loans; $2,000 to $50,000 for Patient Solutions loans
APR: 5.99 to 34.34% for personal loans; 3.99% to 24.99% for Patient Solutions loans
Term options: 36 months or 60 month for personal loans; 24 to 84 months for Patient Solutions loans
Fees: Origination fees of 1-6% depending on your credit for personal loans; no origination fees for Patient Solutions loans
Minimum FICO score: 600 for personal loans; N/A for Patient Solutions loans
An arm of SunTrust bank, LightStream differentiates itself from other online lenders by having no fees. Because it’s owned by a bank, it can originate and service its own loans, according to its communications team. LightStream’s interest rates and terms vary by borrowing purpose, and loans for fertility treatments can be as large as $100,000, a higher credit limit than most competitors offer. Patients apply directly on LightStream’s website.
Amount you can borrow: $5,000 to $100,000
APR: 5.99% to 15.59%
Term options: 24 to 84 months
Fees: No fees
Minimum FICO score: 680
If you can’t qualify for a credit union or online personal loan, or if you need to finance a small portion of IVF treatments, credit cards could be an option. Credit cards typically have lower credit limits than the amount you could borrow with a loan, and you won’t know your credit limit until you are approved. Additionally, interest rates can be lofty — especially if your credit score is low — and carrying a high balance can hurt your credit.
But if you qualify, zero-interest cards can be an ideal way to help fund at least some of your fertility treatments, especially if you need to borrow a few thousand dollars to meet an insurance deductible, Sullivan says. Some cards offer no interest for up to 21 months, giving you time to pay the balance before interest kicks in.
Who they’re best for: Patients who need to finance a portion of treatment or can get a zero-interest card and pay off the balance before the interest-free period is up
APR: As low as 10% for cards from credit unions, or 11% to 24% for cards with big issuers
Fees: Some cards have annual fees
Minimum FICO score: Typically a score of at least 630 is needed
Health Savings Account
If you can afford to pay for fertility treatments without borrowing money, using a health savings account presents tax advantages, Sullivan says. They reduce your taxable income, the money in the account grows tax-free and you pay no taxes when you use the money for eligible medical expenses. This can even include ancillary costs related to IVF treatments, Sullivan explains.
You can qualify for an HSA if you have a high-deductible health insurance plan as defined by the IRS. For 2017, that means an individual plan with an out-of-pocket maximum of $6,550 and a minimum deductible of $1,300. For family plans, the out-of-pocket maximum is $13,100 and the minimum deductible is $2,600.
There’s a limit to how much you can set aside each year. For individual plans for 2017, it’s $3,400, and for family plans, it’s $6,750. If you’re over 55 years old, you can add another $1,000 annually. Unlike flexible spending accounts, HSAs roll over each year.
Most health insurance providers offers HSAs, but if yours doesn’t, you can get one through most financial institutions. If you have an HSA through your employer, you can set up automatic contributions directly from your paycheck.
Who they’re best for: Patients who can afford to pay with cash and have high-deductible health insurance plans
Emily Starbuck Crone is a staff writer at NerdWallet, a personal finance website. Email: firstname.lastname@example.org.
FertilityIQ Methodology: FertilityIQ’s data was collected between July 10, 2015, and February 19, 2017, via a survey of 3,192 patients who underwent at least one complete IVF cycle in the United States. The total number of IVF cycles completed by all patients was 7,141.
Updated May 1, 2017