Thought for the day:
“I think it is just terrible and disgusting how everyone has treated Lance Armstrong, especially after what he achieved, winning seven Tour de France races while on drugs. When I was on drugs, I couldn’t even find my bike”…. Willie Nelson
If you will read no further:
We talk a lot in these weekly presentations about the importance of providing retirees with a dependable retirement paycheck in the form of a life annuity that places a monthly income directly into their bank accounts. There are many reasons for including an annuity in the portfolio including the high rate of tax free income and the peace of mind one gets from knowing it will last as long as they do, regardless of market conditions or world events.
But here is one very important feature of a SPIA that hasn’t occurred to me in years. SPIA income provides maximum protection from fraud, financial abuse by children, friends or relatives and from other financial choices gone wrong.
The 83 year old lady whose son keeps asking her for $100,000 to start his business would be much better off if she had a SPIA that paid her a lifetime monthly income that prevented her from making an unwise investment decision and moving money into the “dark whole” in the first place.
A recent poll of financial planners and clients rated the top four risks in retirement. They were:
- Longevity Healthcare
- Volatility Inflation
- Healthcare Volatility
- Inflation Longevity
…which bears out our experience talking with clients about long-term care planning and the reactions to our workshops on LTCi and linked-benefit plans. Eventually all clients want to talk about how to get an insurance company to pay their long-term care bills. The conversation will be worthwhile only if it occurs before they get too old or too sick.
Then there are the claim numbers. In 2013, over $7.5billion in long-term care claims were paid to over 273,000 individuals, according to the AALTCI. But we have another indicator of the scope of this issue. The number of calls we receive from advisors trying to get insurance for their clients who have serious health issues and are facing a long-term care event is rising significantly. Many of these are from advisors who have ignored the issue, believing the client could pay the cost themselves. But when the time comes to face these costs, everyone wants to have them paid by an insurance company.
Thought for the week:
My associates are telling me that I have failed to emphasize enough, the availability of Annuity Care from State life. While I believe a life insurance based long-term care strategy is the best way to go for folks who have sufficient resources to commit to it, the annuity-based version is simple and easy to understand. It’s just an interest baring account that does as well as a CD but much better when the time comes to pay for long-term care.
You have clients with money in banks or money market accounts that clearly would be the first resource their family would turn to if they need to pay long-term care bills. Their money is safe and available and they are earning a modest taxable rate of interest. What if you could tell them that account could double or triple instantly if they ever needed to tap it for long-term care? Using Annuity Care from State Life, they can continue to hold the money in a safe depository that pays a modest interest rate. But now, they will no longer receive that pesky 1099 on that pitiful amount of interest and if they need care, they will have access to as much as two or three times the account value. Call us at (800) 238-8144 and tell Peggy you want to talk to someone about Annuity Care. She will put you on the right track.