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Retirement planning: protecting assets with a long-term care insurance policy

By September 22, 2016No Comments

Many investors consider a long-term care insurance policy a necessary lynchpin for their retirement portfolio: It can help protect financial assets from depletion if faced with nursing-home costs, for example. .

During retirement, many investors may be relying on several streams of revenue coming from Social Security, pensions as well as 401Ks, IRA and Roth accounts. An LTCI policy could help reduce the draw from personal accounts—other than pensions and Social Security—to cover unexpected short or long-term nuring home stays.

For example, with a nursing home bill of $6,000 a month, and monthly income of $2,000 from Social Security and a pension, the shortfall of $4,000 would need to come from personal accounts, such as 401Ks, IRAs and Roth IRAs.

But an LTCI policy may provide either a portion, if not all, of the remaining $4,000, thereby protecting the investor’s remaining financial assets. In addition, another a benefit from owning a LTCI policy is the option investors may have to choose between ‘in-home health assistance’ vs traditional nursing home care: The limited care you could receive in your own home—or even in an assisted-living facility—is usually based on one’s ability to perfrom ‘daily tasks.’ For example, if a loved one is unable to cook their own meals, or bathe, the policy can generally cover assistance in these areas.

As a small business owner, you may be looking at more ways to help fund your retirement objectives. Contact us. We can provide tax guidance along the way, or even assist in setting up an IRA for your business.