Long Term Care: Needed If I Have Decent Assets And No Dependents?
Hey Terry I listen to you on WGN every Wednesday at noon when I am working out. I know you recommend LTC insurance for those who can afford it, but I am wondering if my situation is different.
I am 63, retired, single/no dependents or any “needy” heirs (niece and nephew are comfortable and well provided for). I have $2.2 mil in retirement assets (nearly all pretax 2/3 stock 1/3 bond), $70K in chicken money and HSA funds, no debts, no mortgage, have a social security level income option pension of $53k annual which currently covers my living expenses so I have no current need to tap my retirement money. I have had a LTC policy for about 20 years through my former employer. I currently pay about $230 a month for a policy that gives me a moderate amount of protection(about $300k lifetime benefit), but it is through a now-shaky provider (Genworth Financial) and of course the premium increases every few years. I am in excellent health, good longevity genes. Do I really need to keep paying this $ to what I fear may be a black hole given the LTC carrier and rising premiums, or could my financial situation/retirement assets probably handle any care needs down the road? By the way, I am pretty sophisticated investor (CFA charterholder and former institutional investor consultant) so I am well versed in corporate retirement benefit investments but I am not that much different than the guy next door when it comes to personal retirement needs. I have heard/read conflicting advice from other shows/articles, but the situations answered to are not that close to my situation. Thanks for any insight you can provide!
Terry Says
You fall into that “sweet spot” where you would definitely question the wisdom of paying higher premiums each year on the older type policy. I understand your angst.
If you have good “longevity genes” you might well live another 30 years, so a lot of this depends on how long you expect to keep working and bringing in an income — and when you will want to start drawing down your savings – -and the possibility that they will “run out” just when you need LTC!
The question is really: “Will I have enough assets left when/if I need LTC so I’m not shunted into a Medicaid nursing home (and who knows what that will look like in30 years?!)
I’ll recommend two things. Start with a good fee only FIDUCIARY financial planner. Search for a carefully vetted one at www.Wealthramp.com.
And contact my trusted LTC advisor Brian Gordon at Murray A Gordon Associates — 800-533-6242. YOu can use my name or not, as I get nothing out of this but the certainty that you will be well treated. He might suggest that you switch to a combo policy that offers a death benefit if you don’t use the care. It locks in the price of care, and gives you an inflation adjustment. You can trust him completely to advise you.
