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Thursday
Feb162017

Long-Term Care: An Integral Part of Your Financial Plan

Long-Term Care is increasingly becoming an issue that needs to be addressed in a person's financial plan. Statistics Show 70% of Those 65 and Older Will Experience a Long-Term Care Event. Many people want to ensure they don’t become a financial burden to their family, or they want to ensure their assets are adequately protected.

Quantify the Risk

Long-term care is a very important but often overlooked area. It is identifying the real financial risk of needing care at some point in the future and then determining how much of you want to self-insure vs. how much risk to push off to the insurance company. Knowing the current costs of services in a particular area where you live and are most likely to retire is most important. At Henssler Insurance, we look at the actual cost of long-term care services today and factor in historical inflation to help quantify your total risk exposure. We break down these costs into categories, such as, “in-home care,” “assisted living” or even “facility care.” For a couple, the biggest risk is if one person suddenly needs extended care, which introduces new costs, while the other person maintains all of their originally planned financial commitments.

Develop a Long-Term Care Strategy

Statistics show us that fewer than 30% of American adults older than 50 have taken steps to address their long-term care risk. The basics of a plan include knowing your current spending patterns, the type of accounts and investments that make up your assets, as well as understanding your personal family medical history and risk tolerance. We have dedicated resources to help clients understand their risk. Together we can develop an appropriate plan to manage that risk.

Consider your Insurance Options

Today’s insurance market can provide great options to help you mitigate the risk of long-term care costs significantly impairing your financial goals. On one hand, you have traditional long-term care policies, which can do a great job of tailoring a solution to match the current and long-term cost of services.

However, much like homeowners or car insurance, you may never use the benefits if you never experience a qualifiying long-term care event. To mitigate this “risk,” an increasingly popular option is a “hybrid policy” that combines the characteristics of a life insurance or annuity policy and adds a long-term care rider. These valuable alternatives offer guaranteed premiums and benefits. Most like the idea that they will receive a benefit, either in the form of a death benefit or predetermined monthly long-term care benefit if needed.

Long-term care coverage is becoming an integral part of a financial plan. We advocate identifying and quantifying the risk, creating a plan or strategy, and then evaluating your insurance options.

If you have questions, contact the experts at Henssler Financial:

Disclosures: This article is meant to provide valuable background information on particular investments, NOT a recommendation to buy. The investments referenced within this article may currently be traded by Henssler Financial. All material presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. The contents are intended for general information purposes only. Information provided should not be the sole basis in making any decisions and is not intended to replace the advice of a qualified professional, such as a tax consultant, insurance adviser or attorney. Although this material is designed to provide accurate and authoritative information with respect to the subject matter, it may not apply in all situations. Readers are urged to consult with their adviser concerning specific situations and questions. This is not to be construed as an offer to buy or sell any financial instruments. It is not our intention to state, indicate or imply in any manner that current or past results are indicative of future profitability or expectations. As with all investments, there are associated inherent risks. Please obtain and review all financial material carefully before investing. Henssler is not licensed to offer or sell insurance products, and this overview is not to be construed as an offer to purchase any insurance products.