Finances

CALMING THE CHAOS OF AGING

WHY DO I NEED LONG-TERM CARE INSURANCE?

Chances are greater than 7 out of 10 that some day you will need long-term care. The average cost of long-term care in Michigan today is $154 per day and the average stay is 2.5 years. This equates to an average of $56,210 per year. Long-term care costs have been increasing at about 5% per year. The chance that you will need long-term care is greater than the chance of loss of home or auto. Just as you would insure your auto or property, you should also include long-term care insurance as a hedge against the financial risks of an extended stay in a nursing home.

How many of you pay yearly for car insurance? Hopefully, you’ll never use it for that year. If you do use it, your car is back in service. However, with illness, you can suffer a long drain on your finances. You may never get “back in service”. If you suffer sticker shock when you get your car insurance bill, wait until you see your monthly long term care bills!

Long-term Care Insurance should be a consideration whether you are 30 or 75 years of age. Accident and illness can happen at any age, any time.

Waiting Can Be A Costly Mistake

Talk to a Long Term Care Insurance Specialist today.

REVERSE MORTGAGES

The care specialists rarely discuss this resource. If you’re the average American senior, you’ve spent most of your life paying off the mortgage for when you retire. Now that you’re retired, expenses such as property taxes, home maintenance, medical bills, auto repairs, etc. are straining your fixed budget. You may be forced to sell the home to get the funds you need to make ends meet.

A Reverse Mortgage is a loan where you can receive money from the lender, instead of paying money to the lender. If you are at least 62 years of age, you may be eligible for a reverse mortgage.

Income and credit histories are not considered, and there are no credit qualifications for Reverse Mortgages.

This equity can be provided in several ways: a lump sum, a line of credit, monthly disbursements or any combination thereof. This borrowed money is tax-free (because it’s not income, it’s a loan), and it does not affect your eligibility for Social Security or Medicare benefits. (Medicaid, food stamps or SSI may or may not be affected depending how the money is disbursed).

Go to your bank or a reverse mortgage specialist to learn more. If you own a home and meet their qualifications, it may be worth your time.

KNOW YOUR FINANCES

Quality care as we age cost money from our own pockets. Be prepared.

A good financial planner can help make sure that when you retire, the money is there for your fixed expenses and the “quality of life” retirement activities such as hobbies, travel, fine dining, etc. that you have been looking forward to doing.

Some items to consider tracking are:

Obligations:

• Loans & Mortgages
• Safe Deposit Box Fees
• Credit Cards
• Taxes
• Stock Portfolio and (hopefully!!) Capital Gains
• Property Taxes
• Investments
• Life and Medical Insurance

 

Basic Living Expenses:

• Food & Clothing
• Medical, Rent or Housing
• Maintenance of Housing
• Transportation
• Hobbies and Time With Friends/Family

 

Assets:

• Property
• Cars
• Businesses
• Valuables

 

Possible Income examples:

• Investments
• Pension & Social Security
• Rental Property
• Retirement Funds
• Divorce Income
• Life Insurance Payments

Having a good financial system takes the pressure off you. Talk to a computer specialist or your grandchildren about programs such as Quicken. They make the process easy and something you can take to the CPA at tax time. If you are a sandwich generation guy or gal, your parents may need your help with their finances. With this type of system, showing them monthly reports will be a snap.

Understand your limits, prepare for financial responsibilities, and live within your means. Enjoy each day one day at a time.