David HaynesDavid Haynes, CLTC, is an independent insurance broker specializing in long-term care insurance planning. Contact David at 336-314-1698 or david@haynesltc.com.
“Hope” is a comforting word that often gives us peace and calmness. It sometimes stirs emotions of confidence about our future. One of the most popular lines in the 1994 movie classic “The Shawshank Redemption” says, “Hope is a good thing, maybe the best of things, and no good thing ever dies.”
However, this word “hope” may be misunderstood when it comes to retirement planning—particularly when addressing a potential extended personal care event. We often call it “long-term care.” We hope for the best years ahead, and so often do not plan for potential obstacles. A long-term care event can have catastrophic financial issues to a retirement plan if it is not properly insured against the unknown cost of care.
Long-term care is not a place. It is an event that can occur at any age, at any time, and to anyone, often without warning. We often think of long-term care as an older adult issue. While there is truth in that belief, it is important to plan and insure while we are younger and healthy to obtain coverage that will be of value later in life. In other words, most of us don’t need the benefit now—we simply need the coverage for later. Meaning, don’t hope but plan for the unknown.
Planning for a long-term care event is not a pleasurable thought. It can be challenging to our minds in creating the worst possible “what if” scenario. If you have experienced an event with a family member, possibly a parent or grandparent, you have witnessed the emotional, physical, and financial truths of the cost of care.
Care requires dollars—period. The question is, where will those dollars come from?
A possible solution is a properly designed long-term care policy. Many of you have obtained an insurance policy to guard against the cost of long-term care. Congratulations! It may just be one of the most important buying decisions you have ever made. For others, this article should give you hope, with a better understanding of planning.
There are a number of insurance policy designs to fit one’s needs and coverages, and to accommodate any budget. Some plans pay for care while others allow a policy to pay either at death and/or a long-term care event. Remember, any plan design is better than no plan at all. Tax-favored rules may apply to business owners and the self-employed under IRC 7702(b).
This guide in your hands offers many articles, ideas, tools, and potential solutions to planning for retirement or making the most of important family decisions. Long-term care planning involves many people. Let’s face it: We hope to live a long, healthy life. That hope may require us to plan today for that journey tomorrow.
If you are wondering about researching the idea of long-term care, then you probably should. “When you think of long-term care … don’t hope for the best, plan for it!”