Life Insurance
A popular misconception about life insurance planning, is that it’s something to do with ensuring others (your policy beneficiaries) enjoy the fruits of your insurance once you’ve passed. While that is just one aspect of planning for the inevitable, if executed properly, life insurance planning can offer multiple benefits – even as you live to enjoy them!
Why Life Insurance Planning is Important for Individuals & Families
Death benefits pay-out for survivors is only one aspect of life insurance. If the policy holder passes, the cash value of the policy can help young families meet their financial needs, or can even help pay off a mortgage. However, there are other facets of life insurance that are equally important.
Most life insurance products allow policy holders to tap into funds as the value of their policy grows over time. In case you are looking for tax-deferred gains, a life insurance policy offers that too, because you are only taxed once you withdraw the money from your policy. With the right life insurance planning strategy in place, your policy can act as a great source of tax-free wealth transfer to your beneficiaries.
In retirement, a well-planned life insurance strategy can serve to generate additional retirement income, or it might even provide additional living health care benefits in your old-age.
What We Can Do for You
Not every life insurance policy provides you all of these benefits. Our experienced Life Insurance Planning specialists will discuss your needs in detail, and then customize a life insurance plan that meets those specific goals.
Some of the life insurance planning tools and products available to our advisors include:
- Term Life Insurance: If you have a specific time-horizon over which you need protection, then Term Life Insurance policies are definitely worth considering. These policies are designed to provide short to intermediate term coverage at an affordable cost. For instance, if you have young children whom you wish to provide for until they are older – say 15 to 20 years – or if you have an unpaid mortgage that you want your family to pay off in the event of your untimely passing, then a Term Life policy is worth considering
- Permanent Life Insurance: Permanent life policies not only provide insurance protection for life, but are also a great way to grow the value of your policy. The enhanced cash value might then be tapped subsequently, to meet future needs, such as funding college/university education of a child, or creating an additional retirement income stream
- Participating (or Whole) Life Insurance: Depending on what your investment goals are, our insurance advisory team might recommend a Participating Life Insurance product for you. With these products, the cash value and death benefit payout of your policy can experience tax-advantaged growth within the policy. You might also be eligible to borrow tax-free funds (for any purpose you might deem fit) against the cash value of your policy
- Universal Life Insurance: If you are in search of higher savings and earnings potential from your life insurance policy, then a Universal Life Insurance might be what our advisers recommend. These policies also offer great flexibility, as the amount insured can be changed, and premiums can be adjusted (increased, deferred, decreased), while enabling policy-holders to also withdraw part of the cash value
- Variable Life Insurance: If you are someone looking to leverage stock market performance through your insurance policy, then a Variable Life Insurance product might be what you need. They provide policy-holders the option to invest their cash value in a host of insurer-recommended stocks, bonds, money-market funds and other investment products. Our insurance specialists will make you aware of the all the risks and opportunities associated with a variable insurance product
Long-Term Care Protection Strategies
Long-term care can be an expensive drain on family resources. And people might be surprised by the number of Americans who may need long-term care if current trends remain in place.
It makes sound financial sense to develop a strategy to protect yourself—and your family—should the need for long-term care arise.
Since so many people over age 65 are expected to eventually need some level of long-term care it makes sense to have a better understanding about long-term care and how it works—and to consider what you can do to prepare financially.
To do that, we need to examine three key questions:
First, what is long-term care?
Second, how much does it cost?
And third, what are your long-term-care funding options?
What is Long-Term Care?
Long-term care includes skilled nursing care — such as the rehabilitative care needed after an extended hospital stay. But that’s just one of the many types of care available.
Long-term care also includes assisted living facilities. These are environments for individuals who can no longer function independently but don’t need daily care. These facilities offer occasional help with what are referred to as “activities of daily living.” These include help bathing, dressing, eating, transferring—getting in and out of bed or wheelchair—and walking.
It can also include home health care, that is, occasional help with the activities of daily living we just listed, as well as help with meals, budgeting, house cleaning, medication management, and even transportation. In this case, however, the help is offered by hired assistants who come to your home on a regular basis.
It can also include home health care, that is, occasional help with the activities of daily living we just listed, as well as help with meals, budgeting, house cleaning, medication management, and even transportation. In this case, however, the help is offered by hired assistants who come to your home on a regular basis.
Long-term care even includes respite care—that is an occasional break for family members who provide long-term care services.
Next Question: How Much Does Care Cost?
The costs vary state by state and region by region.
The national average for assisted living centers—single occupancy—is $43,200 a year. The average cost of a skilled care facility — again, single occupancy in a nursing home — is much higher at $91,250 a year.
The price can range widely from there. Some areas—Utah and Missouri, for example—are somewhat lower than the national average for long-term-care costs. Others—like New York or California—are quite a bit higher.
Source: Genworth 2015 Cost of Care Survey
What are Your Options for Long-Term Care?
There are many, however your primary choice is between two options: self insure or purchase long-term-care insurance.
*The cost and availability of life insurance depend on factors such as age, health, and the type and amount of insurance purchased. Before implementing a strategy involving life insurance, it would be prudent to make sure that you are insurable by having the policy approved. As with most financial decisions, there are expenses associated with the purchase of life insurance. Policies commonly have mortality and expense charges. In addition, if a policy is surrendered prematurely, there may be surrender charges and income tax implications.
