Cash Flow Associated With A Bond Payment To Purchase Bond Planning for Longevity is Smart, But Some Financial Advisors Say "No"?

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Planning for Longevity is Smart, But Some Financial Advisors Say "No"?

Long-term health care has affected more families than ever before. More attention has been paid to this issue due to the COVID-19 virus crisis. However, this is not a new problem. Advances in medicine bring longevity. With longevity comes the costs and burdens of aging. These health problems can be the result of illness, accidents, or just the effects of aging.

Caregiving is always difficult for family members. The role of caregiver is physically and emotionally demanding. You can’t really depend on your spouse because if you are older, your spouse is older too. Grown children will have their own careers, families and responsibilities. A recent Associated Press-NORC Center for Public Affairs Research poll says many young adults are already providing long-term health care services for older loved ones. It’s not easy for them.

A survey shows that one-third of American adults under the age of 40 have cared for elderly family members. Another third expect to be asked to do so within the next five years.

The risk of needing long-term health care is high and increases with age. Once you are over 40, you will notice changes in your health. You see changes in your body. As you get even older, you notice a decline in your memory.

This means that the possibility of needing extended health care is less of an “if” and more of a “when” and “for how long.”

The fact is, the risk of needing extended medical care is simply: it will either happen or it won’t.

When you need long-term care, someone will be responsible for finding a family member to provide care or buy care, either at home or in a facility. The clear majority of long-term care services are custodial in nature. Nursing care is when you need help with normal daily activities or you need supervision because of a cognitive problem, such as Alzheimer’s or another type of dementia.

Health insurance, or when you’re 65, Medicare and your Medicare Supplement will only pay for 100 days of skilled nursing services. Long-term care is both a cash flow problem and a family problem.

Still, some financial planners and insurance agents would rather not research long-term care insurance. Many do not understand the product, underwriting, policy design and power of the LTC Insurance Affiliate Program, which is available in 45 states.

Why? There are several reasons. Some people just don’t know the facts. However, most of them are acutely aware of the impact of the financial costs and burdens of ageing. So why not long-term care insurance?

There is a huge misconception about the cost of policies. You may have even read a few articles. They warn of high premiums or premium increases over time.

The fact is that premiums are very affordable for most people. Of course, if you are 75 when you take out the policy, the premium will be based on that age and your health at age 75. However, people are adding term insurance to their pension plan before retirement, with most in their 50s. Most of my clients are between 45 and 67 years old. At these ages, premiums are very affordable, especially if you are in good health and your policy is properly designed.

Premiums can vary by more than 100% between insurers for the same level of cover.

Policy making is crucial. Most claims are for home care, which usually costs less than skilled home care. Policies pay for quality care in the environment you want. There are several settings for long-term care services, including home care, adult day care, assisted living, memory care, and a traditional nursing home.

The Long-Term Care Insurance Association of America says the majority of claims are for home-based services. The largest companies paid out more than $11.6 billion in benefits to American families in 2020. The policies work and work very well. They give families choice and reduce enormous burdens on loved ones.

Affiliate long-term trading policies provide additional dollar-for-dollar asset protection. With a partnership long-term care policy, you can purchase just enough long-term care benefits to protect your assets without going overboard and overspending.

Some insurance agents and financial planners may want you to buy expensive life insurance policies instead—or worse—do nothing and insure yourself.

Self-financing is not the best way to deal with the future costs and burdens of aging.

There are a handful of outstanding “hybrid” policies available. These are life insurance policies or annuities specially designed for long-term care. For some people, this might be the best solution. However, typically a general insurance agent or financial planner is not the person to discuss these options with.

You need an experienced LTC insurance professional. There are a handful of specialists across the country. These are people like me who represent all the major companies, understand policy design and underwriting, know the power of the affiliate program, and have processed claims so they know how policies are actually used.

In my case, I have thousands of clients across the country in 21 years of helping people plan for their aging. Remember that premiums are based on your age and health at the time of application and the amount of benefits you wish to receive. These policies are custom designed, so you need an expert who works with all the major companies to help you find the right coverage.

What about the increase in premiums. Yes, it is true that premiums have increased on older policies sold decades ago. These “legacy” policies were established and marketed prior to the rate stabilization rules now in place in most countries.

Today’s LTC insurance policies have an underwriting that is much more scientific and conservative than ever before. Premiums now also take into account low interest rates, low delinquency rates and actual claims experience. According to the Society of Actuaries, today’s long-term care insurance plans have a much lower chance of future premium increases.

Regardless of these facts, it is not easy for insurance companies to raise rates for products sold today. This should give consumers a lot of peace of mind as they plan a way to protect savings and reduce the burdens of extended care for their loved ones.

Perhaps the biggest difference between a long-term care professional and a financial planner or general insurance agent is that they only view long-term care insurance as a financial decision. Yes, money is important. However, a long-term care professional knows that it’s about family, your family.

Yes, long term care is a cash flow problem. However, the effects of long-term care also affect your family.

Without a plan that addresses your future longevity, your family will be responsible for everything. The first thing my clients’ grown children tell me when they make a claim is that their mum or dad’s policy gave them time to become a family. They are always grateful for the help that allowed them to be loving and supportive. This way they can spend quality time with mum or dad and not worry about where the money is coming from or, even worse, having to provide care themselves.

Working with an expert will allow you to get the exact information you are looking for. There are several reference sites for research:

LTC News offers articles and resources: http://www.ltcnews.com

US Department of Health and Human Services: https://longtermcare.acl.gov/

Long-term care will affect you, your family, your savings and your lifestyle. LTC insurance is a simple and affordable asset protection. These plans not only protect your savings but also reduce the burden on family members. Let your financial planner handle your mutual fund, stocks and bonds. This is their expertise. Let a general insurance agent get you the best deal on your home and auto insurance. For long-term care, seek the help of a specialist. Take action before you retire to take advantage of lower premiums and your overall better health.

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