There are a lot of things you don’t want to gamble with in life, like your retirement savings, how you raise your kids, or your health. Unfortunately, many Americans take one particular risk with their health, possibly without even realizing it, and that’s neglecting to make a long-term care plan. (1) Since 70% of people will need some form of long-term care during their lifetimes, it’s critical to have a plan to pay for these costs. (2)
But traditional long-term care insurance policies don’t come cheap, and people sometimes feel that if they buy it and don’t use it, they have wasted their money. Is there another option? Is there a way to wisely plan for an unknown future while still setting up your money for growth? The answer is yes, and the option is called hybrid long-term care insurance. Let’s talk about the benefits of a hybrid long-term care option that could work for you.
What Will It Cost You?
First, let’s look at why you need a long-term care plan in the first place. Simply put, long-term care costs are so high that they could potentially wipe out a bulk of your retirement funds. To make matters worse, because of their longer life expectancy, women pay significantly more than men for long-term care. The average amount of time women require long-term care for is 3.7 years (or around 44 months). For men, who need long-term care for an average of 2.2 years (or around 26 months).
Costs are only projected to increase. From 2019-2020, the median annual cost for home health aides rose over 4.5 percent. (3) By 2030, the average cost for long-term care services is expected to double. (4) Costs can vary based on the level of care and amenities needed, as most people would prefer to have private care in their homes. Your first step in making your own long-term care plan is to decide what type of care you prefer and how much you’ll need to finance it.
One very popular solution is a life insurance policy with a long-term care rider. This strategy is enticing because if long-term care is needed, the funds are available through your policy’s death benefit. If you don’t spend the total benefit available, your beneficiaries will receive the balance upon your death (tax-free), thus no wasted money.
If you need life insurance, getting your long-term care coverage as a rider may be a good option. This way, someone will be benefiting from the premiums you are paying, whether it is you or your heirs. Plus, because the policy accumulates cash, the insured individual can access it if needed, allowing them to recoup a portion or all of their premiums.
At T.A. Holland & Co., one of the ways we help our clients secure their future is with hybrid long-term care. This choice takes your money further, leveraging it to provide more assets than you contributed. Plus, it helps you find the peace of mind you long for, protecting your retirement dreams while also giving you the coverage you need to get the care you want should you need it.
Hybrid long-term care gives you guaranteed benefits, such as:
- An income-tax-free death benefit for your beneficiaries upon your death, even if you use up all your long-term care benefits
- Monthly benefit payments to pay for long-term care costs once you’ve met the policy’s eligibility requirements
- As a cash indemnity policy, you have the freedom to save or spend your benefits however you wish, including expenses that may not be associated with long-term care.
- The option to terminate your coverage and receive a premium refund
- Guaranteed premiums—no rising costs!
- Customization options to meet your needs
Is Hybrid LTC Right For You?
When you are healthy and thriving, it’s easy to focus solely on building your savings to provide for your basic retirement expenses and forget about the potential need for long-term care as you age. But no matter what your health looks like today, creating a long-term care plan now will empower you to research your options and choose strategies that are the best fit for you.
If you are looking for simplicity, freedom, and flexibility for your future, our team at T.A. Holland & Co. can walk you through the details of hybrid life/LTC coverage to help you create a plan that gives you the peace of mind you deserve. If you have questions about SecureCare and want to make sure you have the coverage you need, get in touch with us today by emailing email@example.com or calling 617-523-5656 to schedule a complimentary appointment.
About T.A. Holland & Co.
T.A. Holland & Co. was founded in Boston, Massachusetts, in 1920 and serves individuals and businesses throughout the country with their financial needs. We provide cutting-edge financial services with a broad array of solutions to help our clients grow and preserve their wealth. We have seen good and bad economic times. Throughout it all, T.A. Holland & Co. has thrived by always making the customer our number-one priority. We get to know you and understand your needs so we can provide you with the proper guidance and strategies. Our senior vice president, John Hellmuth, has been at the helm of T.A. Holland’s financial services since 1990, but he doesn’t do this job alone. He is joined by his two children, Lindsay Hellmuth and Thomas Hellmuth. As CERTIFIED FINANCIAL PLANNER® (CFP®) practitioners, our financial services team has the knowledge and experience to help you solve your most pressing financial challenges. To learn more about how we can help you, visit our website and reach out to us to schedule a complimentary get-acquainted meeting.