The new policy is to pay long-term care

Elizabeth McLeod, in Overland Park, Kansas, investment adviser, works mainly with retirement income who want to help investors. But before she drew an investment plan, she asked what her clients that they plan, if they need long-term care of things. She told them that they should factor of about $ 23 into their financial planning for the potential costs of long-term care – currently the average daily cost of care requires about three times the average.

Even when the amount of her clients can pay pocket, they usually do not want to. “They find it difficult to spend their retirement savings to endure so many ideas,” she said. But McLeod’s customers do not want to pay the policy premiums HIGH today’s long-term care, either. And low interest rates have led to higher than expected claims for most long-term care insurance to raise interest rates or leave the company in the past few years. So, instead of buying to cover all of the potential costs, how many of her clients are clear, they can easily pay for their savings and buy long-term care policy to fill gaps full policy.

In fact, this is the same McLeod. When she turned 53 this year, she and her husband, Roger Davis, 64, to do their own financial situation was analyzed, and bought long-term care policy Genworth. They chose to reduce premiums, but their policy will be to protect their savings are still hundreds of thousands of dollars.

Strategic choice. In the past few years, long-term care policy is more stringent, the premium has been raised. Generous benefits – such as life expenses and 5% compound inflation protection – is very expensive or disappear from the policy menu. But the new wave of baby boomers every year to watch their aging parents and relatives to write checks of more than 7,000 per month $ Care – blowing through their retirement savings.

Financial advisor knows, may be a long-term care costs one of the biggest threats to retirement plans. If you do not deal with the risk of long-term care, “it can destroy the plan,” Keith Moeller, CPA and wealth management consultant with Northwestern Mutual said in Minneapolis.

As toThis, however, long-term care insurance soaring, many people have taken a new approach to cover the risk. McLeod and Davis each bought a $ 100 daily benefit provided it with a 3% annual compound growth strategy. The average cost of a private room in a nursing home in Kansas City for $ 157 yuan day, according to the Metropolitan Research Institute mature market, but the couple figure they can afford to pay the difference between savings.

They pay about $ 3,000 per year to combine the two policies, including revenue sharing drivers, which can provide up to $ 300,000 (in today’s dollars) of the total benefits, if they need to take care of, to eight years, they between the two. If Davis needs, such as care for two years, then McLeod can still use the six years covered. Shared interests tend to add about 10%, in order to increase the benefits of a partner during the period to 15% BUt premiums can extend. Even though the average requirement is about three years time, who takes care of a long time often need it

Number long – sometimes a decade or more if they have Alzheimer’s disease Some insurance companies offer policies, many of the costs and benefits of the consumer price index rose, and this policy is available in 5% compound inflation protection than those of less. A 55-year-old who wants to benefit from a three-year period, the daily benefit and a 90-day waiting period will be charged the $ 150 John Hancock policy of $ 4,320 per year and 5% compound inflation protection; to report annually there is an upward change in the CPI, the annual premium is $ 2,175.

Another important feature is the insured person’s home care needs. It is better that you do not need to buy from an agency, who often exceed the cost of informal care policy to use only authorized caregivers. McLeod Davis and policies, allowing them to hire people than any other relative. “If you’re in a nursing home when it will not be great, you use what kind of company – they send a check, but home care in the rubber meet the road when I evaluate a policy,” said senior Ashley benefits consultant in prairie village, Kan Naoto.

And see how the waiting period, which is often 60 days or 90 days the number of days of care policies. Some policies start the clock, as long as your medical certificate, you need to have two out of six activities of daily living (Such as bathing, dressing) or help with cognitive disabilities. Others count only the sky is YOU receive care. Please note that if you are using less than your maximum daily benefit may be extended benefit period.

Some insurance companies have a lot stricter than others medical conditions which rob you of your policy. John Ryan, Ryan Insurance Strategy Consultants, Greenwood Village, Colorado, recommends that agencies review your medical history, then companies may find someone with your health offer the best deal. For his clients, Ryan tend to work in conjunction with Genworth, Omaha and MassMutual. John Hancock, New York Life and Northwestern Mutual are also in long-term care insurance business big-name players.

Premium large differences, it is necessary to shop around. Recently, a 55-year-old a policy, $ 150 daily benefit, the third is ah R benefit period and 3% compound inflation protection over an average premium of $ 2,110 – but there are high, there are 50 between lower premiums % difference, according to the American Association for long-Term care Insurance price index 2012. To find someone who can provide quotes from several companies, please visit the association’s website proxy.

Change More embodiment.

Last summer, Genworth has made its policy of some big changes: it suspended the preferred discount rate in most countries, a 40% reduction of 20% discount to couples and suspend lifelong benefits and limited pay policies (such as its payment policy a decade). The company said it would bring back some of the options in its new product next year. The company plans to make the 2013 policy changes have more NE W – because Genworth is the largest long-term care insurance, many companies are expected to follow suit. The company will switch to a specific gender neutral interest rate, which will lead to higher interest rates to buy their own coverage for women (Genworth expects interest rates leveled couple). The company will also expand health coverage, so your health will play a greater role in the premium you pay.