Most of you have heard the old saying…KISS- Keep It Simple Stupid. Although the politically correct way now is Keep It Simple Silly, I still like the original version. I learned this saying during my days as a Marine Corps Officer and it just meant to keep your plans simple, easy to understand and easy to carry out. I think we can apply this idea to Long Term Care(LTC) planning also. So, let’s try a simple question and answer approach.
1) Do I Need LTC Insurance? The simple answer for most people is yes. The odds are fairly high (60-70%) that we will need some type of care down the road whether that be Home Health Care, Assisted Living or Nursing Home care. The odds are even higher for a couple. The odds of having a reported home fire during your lifetime are about 25%. The odds of having a reported auto crash injury during your lifetime is about 26%. The percentage of people reporting an unexpected medical expense in the last year is about 34%. The percentage of individuals over age 65 that will require some form of LTC service is about 70%. We all carry Homeowners, Auto and Health Insurance for those smaller risks…why don’t you have LTC Insurance for the larger risk?
2) Will my family take care of me? To some extent yes. Most will want to help out in some way or the other but most can’t afford to make it a continuous, round-the-clock affair. They have their own families and probably have limited resources and time. Besides, there are probably some care needs you really don’t want your kids help with anyway. Also, most times the burden of care falls unfairly on one sibling or child.
3) Will the Government take care of me? My first response to that is…”Do you really want them to?” The quick answer is maybe…maybe not. Medicare has limited benefits for a short period of time. Medicaid means impoverishing yourself. With government budget cuts and problems, it will probably get harder and harder to qualify for possibly reducing benefits.
4) I don’t like LTC health insurance Most people don’t. They see it as a costly product that will probably continue to have even more costly rate increases down the road and the biggest objection is the “USE IT or LOSE IT” aspect of the product. If they don’t need LTC or don’t use it for very long, they have spent a lot of money for little financial return.
5) Is there a better Solution? In my mind and for many thousands of satisfied customers that have already done so…YES! It is called “ASSET BASED LONG TERM CARE” (ABLTC) Instead of using a health insurance product that is prone to rate increases and is “USE IT or LOSE IT” in most cases, ABLTC uses either a Life Insurance or Annuity based product for Long Term Care protection. This eliminates rate increases entirely and if you don’t need or use all the benefits, they pass on to your heirs. In the case of the Life Insurance based product…INCOME TAX FREE! They are more of a WIN-WIN type of approach.
6) How do I pay for ABLTC? However you wish! These products can be done with a single premium by using Cash, CD’s old cash value life insurance, old annuities and even IRA’s and 401k funds or they can be paid on a pay-as-you-go basis. If you like the idea of a WIN-WIN product that guarantees no rate increases… there is a way to pay for it that will fit your situation.
I hope this helps to simplify some of the issues with Long Term Care planning. Please give me a call at 309-297-0296 or email me at firstname.lastname@example.org to discuss these ideas. If you were referred to this site by another agent, please give them a call.