AboutEileen J. Tell Expertise I can help inform and educate people about long term care insurance and whether it is a product they should be considering. I can help them evaluate different policies or answer basic questions about long term care needs and costs. I have over 15 years experience developing and evaluating long term care insurance products and services and have worked with most of the leading companies in the field. I do not receive any commissions or fees from any companies, so my views are independent and neutral.
Question Given the following scenario, would you advise the purchase of long term care insurance?
Husband age 58 Wife age 56. Son 10.
Household income $225,000. Financial assets (variety of mutual funds and CDs) $1.5 Million (excluding home owned free and clear worth apoproximately $600,000). Pensions (including Social security: at age 65 approximately $10,000 month.
Health of both husband and wife are good.
Would the family above be better served by potentially paying out of pocket for possible long term care or purchasing a policy? If purchase is recommended, at what age?
Thanks.
Answer I believe strongly in buying LTC insurance to protect the assets that you have for your heirs - to ensure their quality of life should you or your spouse or both need expensive LTC someday. Even though you likely have enough money to pay for future LTC needs (Use the Savings Calculator on this government website to see what you might need to pay for lifetime LTC costs for each of you - http://www.longtermcare.gov/LTC/Main_Site/Planning_LTC/Considerations/index.aspx), having LTCI means you can protect almost all of these assets rather than "using them up" to pay for care.
You can use the interest on your assets to pay the premium cost to protect/insure those assets. You are at the perfect ages to buy and would likely get both a couples' and a good health discount from many companies that give them.
If your desire is to receive care at home as long as possible - that can be very expensive. My colleague is paying $40,000 a month for in-home help for his aging parents who have Parkinson's and Alzheimer's. He has been doing this for 4 years now so the costs add up quickly. This is money that otherwise he would have been able to leave to his 3 children and their families.
I don't sell any LTCI - get no commission. I have a good friend who does and represents only the best companies if you want a referral (plus she knows about other financial vehicles ilke annuities and LTCI combo products and can give another viewpoint on self-insuring vs. buying.
The companies I would focus on (only the best) are: Hancock, MetLife, Genworth, Prudential, Northwestern Mutual (more conservative and pays dividends and known for excellent customer service), and possibly New York Life.
If you are a federal employee/retiree or affiliated with any of the 20+ state governments that offer group LTC insurance through work, I'd consider those programs. The federal program is insured by John Hancock (www.ltcfeds.com)
I'm happy to review any specific plan choices or policies if you are interested in getting that far. You can email back through this website or call if you want more info (888-312-5824)
Good luck. I think it is smart of you to be even thinking and talking about this issue.
