How You Can Plan For Long Term Care Costs

What are the images that come to mind when you think of Long Term Care (LTC)?  For most people, it's not something they want consider for themselves or a loved one.

There are two types of burdens when a family member is in a LTC situation:  financial and emotional.  We can't help you with the latter, but we can help you plan for the financial part.

Of course, there are LTC policies out there and they can be pricey.  The insurance industry has recently starting developing life insurance plans which can be used for LTC expenses as well.  Again, they can be a bit pricey.  What's the alternative?

One product we've come across is a Disability Income policy with rider that can help cover LTC costs.  And the good news is that the rider is very affordable.  When you consider that you need a disability policy anyway, why not cover some, or all, of your LTC needs while you can?

Give us a call or look us up on the web and let us help you.

Don't Get Overwhelmed With This Stuff

Occasionally someone will tell me that they just don't understand the differences between term, permanent, whole life, universal or indexed life insurance.  Throw in annuities, disability insurance, and other financial products being sold out there and even us agents get confused.

As I have mentioned before, there are hundreds, if not thousands, of products from over 1100 companies.  My philosophy is that every one of those products has a need somewhere, but for the vast majority of our clients, simple is better.

We want our clients to be as comfortable with a financial product as possible.  Whether we are discussing the benefits of a life policy or the fees in a retirement plan, there should be no confusion.

And if someone tells you that a products has "no fees", that implies that the financial institution isn't making any money.  Of course, that isn't the case either.

If you have questions about a product, give us a call or drop us a line on our website.

That Time of Year Again

It's tax season and it isn't too late to make some last minute deductions and try to keep as much of your hard earned money as you can.  Here are a few pointers that may help you this year, as well as a few that will save you money next year as well.

1.  You have until April 15 to make contributions to your IRA or other tax-qualified retirement plan. Remember that you can deduct contributions to a traditional IRA, but not a Roth.  

2.  Keeping your refund closer to zero is better than getting back a large refund.  If you are getting back a lot of money, remember that you loaned that money to the government free of charge and they are just paying it back.  

3.  If you are a business owner, self-employed or an independent contractor, you should seriously consider a SEP-IRA or a Simple IRA.  The contribution limits are much higher and can save you money on your business' tax bill.  

4.  Make a habit of keeping track of all of your deductions throughout the year.  This will save you a lot of time.

5.  A tax preparation company can be expensive.  If you have 1 employer and you don't itemize, an EZ form can be done on your own.  On the other hand, if  you have questions throughout the year, maybe an accountant is worth the money.  

The question we ask our clients is this:  How efficiently does the government spend your money and can you do better?

Don't Suffer From Low Interest Rates

Many people have taken advantage of low interest rates to refinance their homes and purchase cars.  However, there is a downside to these rates.

There is a record 9.4 Trillion Dollars sitting in underperforming CD’s, Money Market Accounts, Savings Accounts and fixed annuities earning record low interest rates.   Now is the perfect time to look into ways to maximize the growth of those funds and most importantly the possibility of transferring the money to your children, grandchildren or favorite charity –income tax free!

Many of you have done a fantastic job saving for retirement and many are looking for things to do with the money designated to pass onto the next generation.  Life insurance is an excellent option to consider.

If you have "lazy money" in sitting in an account that you don't need immediately then consider a Single Premium Whole Life policy.  

What Is Final Expense Insurance and How Can I Avoid Buying It?

You probably have seen the commercials on TV with Alex Trebek pitching a life insurance plan with no medical questions.  These ads typically show elderly people discussing how one of their friends died and the surviving spouse was left with all the bills.

What they are selling is known in the industry as "Final Expense" insurance and if you plan correctly, you won't need it.

Final Expense is a whole life policy, typically sold in units.  Each unit is $1000, so multiply the price Mr. Trebek is telling you times the number of units needed to have a nice funeral.  With the average cost of a funeral between $7000 - $10,000, depending on where you live and how fancy you want to your send off to be, you'll be paying more than the price you see on the screen.

The "no medical exam" part can cost you extra as well.  Anytime an insurer does less underwriting on a policy, they build that additional risk into the premium.

And some final expense policies have a provision that says that if you die in the first 2 years of the policy, your beneficiary doesn't get the death amount, but instead a refund of the premiums paid plus some interest.

The reason people purchase these policies is because they have either put off the inevitable and/or they have had a health scare, which makes them less able to get better rates.  Generally speaking, you probably will not be getting healthier as you age.  Now is the time to look at life insurance, not when you are sick and old.

So what can you do to avoid all of this?  Talk with your insurance agent (hopefully it's us!) and discuss a comprehensive life insurance plan that includes your final expenses.  An affordable alternative is a Guaranteed Universal Life policy purchased while healthy and will cover you to age 120 (yes, we do that now).  The lower rates will be locked in and you'll have one less thing to worry about.

Are You Ready For Open Enrollments?

November 15 is the first day of open enrollment season for health insurance.  This is when you can make changes on any of your health insurance plans. 

Hopefully things will run much smoother than last year, but be prepared for glitches that are bound to happen.  We suggest that you make an appointment to meet with your health insurance from now since the enrollment period is shorter than last year.  

If you are in the Myrtle Beach area and need an agent, contact us to book an appointment.  The good news for South Carolina residents is that Assurant Health will be added to the health exchange.  This gives everyone another option to choose.

As of now, the insurance companies have not released what the new premiums will be, so be ready for some increases in your premiums.

Would You Rather Have An Insurance Salesperson Or An Insurance Consultant?

Everyone is different.  Not everyone wants to be "sold" something.  Especially life insurance.

The advent of the internet has brought many challenges to those of us in the insurance industry.  Whereas one used to be called on by an agent, now many people can go online, do their own research and determine what they want to purchase.  On the other hand, some people still want someone to sit with them and discuss their financial and insurance needs.

We do both!

Want to use a financial calculator and go online to purchase life insurance?  You can do it here. And if you'd like for one of our agents to sit down with you and discuss your needs, we can do that too.

And while you are at our website, you can take a look at other types of insurance as well, like Disability, Cancer, Critical Illness and Dental*.

Let us know if we can help.

*Not all plans are available in every state

Chris Castanes is the president of Surf Financial Brokers, helping people find affordable life and disability insurance coverage. He's also is a professional speaker helping sales people be more productive and efficient and has spoken to professional and civic organizations throughout the Southeast. And please subscribe to this blog!