U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Retirement
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
 
Old 02-24-2018, 07:17 PM
 
218 posts, read 87,169 times
Reputation: 553

Advertisements

Quote:
Originally Posted by runswithscissors View Post
? Uh, no. You cannot just "decide" to "use" LTC insurance. You need a medical reason.

Like every other insurance, you have to NEED it.

For Assisted Living, for example, it's even in your contract how many ADLs you are requiring before you can move there. Activities of Daily Living.

Furthermore, LTCI covers IN HOME care, too.

I notice you said "we". Hopefully you CAN cover two separate residential facilities per year when and if you get separated because of health. That's about $200K or so per year.

Hopefully, SHE'LL get first dibs on the good place. LOL
I was aware of the "need" comment possibly being cited. But it's just a post, not an opus. Doctors advise us, they don't have enforcement powers. If they did, no one would smoke, overeat, etc.

As I said, we took a risk. We won. We can pay for both of us for more years than I'd ever care to spend in one. We were there back when we made the decision.

I know, "we" was me. She'd have bought a policy. But we both enjoyed the cruises and other trips we took on premiums we never paid.

The decision should be made based on one's financial situation.

But I appreciate your post.
Reply With Quote Quick reply to this message

 
Old 02-25-2018, 05:51 AM
 
30,165 posts, read 47,394,029 times
Reputation: 16116
Quote:
Originally Posted by BucFan View Post
My plan is to pay for LTC insurance as long as I can budget for it. It's a priority behind home, utilities, food, transportation, regular health care.....but ahead of discretionary spending like travel, entertainment, etc.

If you use up all of your assets in your estate for your long term care, I assume Medicaid (if available and not defunct) will be the next way to finance the care.
This is one reason people should develop a relationship with a knowledgeable advisor who can give a dispassionate assessment of the best way to plan for the future--
There are new insurance products that can be used to cover LTC costs and if not used the money goes to death benefits so the money invested (or some portion) can be passed to a beneficiary--
Buying insurance always has the possibility that you are paying for coverage you won't use
We have insurance on our homes and cars and you know you are ALWAYS better off when you don't have to file a claim...
The issue with LTC coverage is that insurance companies have not been good about calculating future costs for that coverage---and the rise in medical/nursing costs are unpredictable in their yearly increases...the low rate for secure returns has also created instability in the insurance market
whatever can't be calculated with reasonable sense of certainly makes insurance companies VERY nervous...

Maybe you want an insurance agent but maybe it is a financial advisor or someone who deals with "senior issues" is a better choice---you don't want to buy from someone who is only concerned w/his or her commission

We have LTC insurance w/John Hancock--have since we were about 55, 56 and have not seen bad rate increases--we tried to choose a policy that allowed flexibility for help at home for less serious conditions before a full time nursing home is needed because the guy we dealt with and the research I did said that MOST people need help at home for lot longer than they wind up in nursing/assisted living...
Reply With Quote Quick reply to this message
 
Old 02-25-2018, 07:23 AM
 
71,799 posts, read 71,896,917 times
Reputation: 49355
i always have to give a heads up on those hybrid life/ltc policies to the fact that they appear like great deals because they give your heirs back money .

but don't be fooled . they operate in a fashion that has them being far more costly over time than the premiums on a typical ltc policy which would have far better benefits and coverage .

as rates rise your policy acts as a call option on interest rates for them . they do not have to raise your premiums or ask for more money for your coverage .

as rates rise they just keep all that additional interest on that large sum of money that you plunk down . they don't have to increase you 4k in premiums , they just take 4k in interest .

it really can be the most expensive way to get coverage despite the bit they give you back and call it a life policy .

as top researcher michael kitces points out the better deal is likely buy a regular ltc policy and invest the difference letting a piece of the gains on that money cover the premium .. :

Executive Summary
As traditional long-term care (LTC) insurance becomes more and more expensive, and interest rates remain at ultra-low levels, planners and their clients have become increasingly interested in so-called “Hybrid LTC” policies that match together a life insurance or annuity policy with LTC coverage, especially with a more favorable set of tax rules that took effect in 2010. For many, though, the primary appeal of hybrid policies is the simple fact that, unlike their traditional LTC insurance brethren, the premiums really are guaranteed and cannot be increased in the future. Given some of the extraordinarily large premium increases that traditional LTC coverage has experienced in recent years – especially for some of the early policies issued in the 1990s and early 2000s – a cost guarantee is remarkably reassuring.

Yet the reality is that the guarantee of LTC premiums in a hybrid policy may be entirely offset by the fact that the insurance company controls the cash value, and is under no obligation to pay a going rate of return, especially if interest rates rise. In other words, it doesn’t really matter that the insurance company can’t increase the premiums on the policy by $4,000/year, when the company can simply under-pay on the interest rate by $4,000/year to accomplish the same result! And while the cash value of a hybrid LTC policy generally does remain liquid, taking a withdrawal to reinvest to get better, higher rates would entail surrendering the policy and forfeiting the LTC coverage! In fact, for some types of hybrid LTC policies, the arrangement contractually provides no rate of return to the client at all, and is essentially the equivalent of the client selling a call option on interest rates to the insurance company, where the more rates rise the greater the company wins at the expense of the client!

Given the unique structure of hybrid LTC policies, though, there are still several circumstances where they may be appropriate, despite the concerns about how they may perform in a rising rate environment. In some cases, simplified underwriting provides a way to get coverage for those who otherwise couldn’t get any, and in other scenarios, the favorable tax treatment alone can make a hybrid policy compelling as a place to park an existing appreciated annuity. Nonetheless, the bottom line is that in today’s environment, consumers must be careful not to engage into hybrid policies that amount to little more than offering the insurance company the unilateral right to profit if/when interest rates rise, when the reality is that simply following a “buy LTC insurance and invest the rest” philosophy would lead to a far better outcome in the long run.

Last edited by mathjak107; 02-25-2018 at 07:38 AM..
Reply With Quote Quick reply to this message
 
Old 02-25-2018, 07:45 AM
 
30,165 posts, read 47,394,029 times
Reputation: 16116
All I meant was that planning for the future requires specialized knowledge most people dont have
Some info available online or in books seems applicable to all--
Spend less than you make, avoid debt/credit, save in taxable and tax-delayed accounts
But people usually benefit from special knowledge
Getting it frim people who value your needs above their own is the crux of the connundrum
Reply With Quote Quick reply to this message
 
Old 02-25-2018, 07:53 AM
 
71,799 posts, read 71,896,917 times
Reputation: 49355
i agree . the problem , like you said is most run on mis-information , myth , and bits and pieces of what they hear from others who are not totally informed in this area .

it is very complex and situation dependent as to what you can do , should do or even what your options are and a lot is state dependent .

it is best to consult an elder law attorney for the best way to proceed . it may be the cheapest choice in the long run rather than try to plan what you will do with half a head of knowledge .

while you are there ask him about all the " self insurers " that come to see them after the fact . like most elder law attorney's i would bet the majority of their work is working with the self insurers who called it self insuring but really had no plan or segregated money . now the stay at home spouse is panicking .

Last edited by mathjak107; 02-25-2018 at 08:05 AM..
Reply With Quote Quick reply to this message
 
Old 02-25-2018, 08:21 AM
 
Location: Paranoid State
13,047 posts, read 10,460,401 times
Reputation: 15684
Quote:
Originally Posted by EveryLady View Post
Her daughter must dress her before outings; the staff delivers meals to the room even though that's not part of the contract... But *could* she - put on stretch pants or a kaftan to go to the dining room? Probably, but pity the person who tries to make her... In my aunt's world, SHE makes the decisions and woe the person who crosses her.
Hunger is a wonderful motivator. Perhaps if no food were delivered, after a few days she would voluntarily decide to go to the dining room.
Reply With Quote Quick reply to this message
 
Old 02-25-2018, 08:22 AM
 
Location: Paranoid State
13,047 posts, read 10,460,401 times
Reputation: 15684
Quote:
Originally Posted by EveryLady View Post
Plus, it's hard to figure out whether the refusal is connected to early dementia or my aunt's personality (controlling perfectionism, pure narcissism).
Quote:
Originally Posted by matisse12 View Post
But isn't she paying a high price to be in an assisted living facility - so the small courtesy of having meals brought to her room does not seem like asking too much.
It is enabling manipulative behaviour.
Reply With Quote Quick reply to this message
 
Old 02-25-2018, 10:50 AM
 
3,100 posts, read 827,905 times
Reputation: 1765
Strikes me that the questions posed by the Original Poster may be the most pertinent - he/she asked first whether or not retirement savings are futile? No disagreement that in the abstract the answer appears to be they are not. Even a small amount may alleviate some future situation.

But Original Poster's subsequent posts went further ... referring to current challenges and questioning past financial decisions. Sure, someone who feels "they have won the race" will be satisfied and no doubt it's human nature to give ourselves a back pat for past decisions. I'm sure guilty of that.

To Original Poster, I can only say that in hindsight I at least STILL would have made some past decisions differently. More, I've been blessed along the way with good fortune that was not always of my making, even in part.

If there is anything that age gives us, perhaps it can be this: to say that we made the best choice possible given the setting or even if someone believes it pertinent to say we just plain screwed up.

But not to self-blame, or go beyond looking at the why of it. Sure, the consequences may be present in each and every day - and to that the only choice becomes how well you go forward to mitigate or cope with the resulting lack of financial resources. A day done well might be "good enough."

People have to be reading and contributing to this thread for a reason. For me, the driver was that the topic was quite timely. Perhaps, though, HOW folks come to these decisions is more relevant in the end than the specific position taken.
Reply With Quote Quick reply to this message
 
Old 02-25-2018, 11:09 AM
 
3,100 posts, read 827,905 times
Reputation: 1765
Quote:
Originally Posted by mathjak107 View Post
i agree . the problem , like you said is most run on mis-information , myth , and bits and pieces of what they hear from others who are not totally informed in this area .

it is very complex and situation dependent as to what you can do , should do or even what your options are and a lot is state dependent .

it is best to consult an elder law attorney for the best way to proceed . it may be the cheapest choice in the long run rather than try to plan what you will do with half a head of knowledge .

while you are there ask him about all the " self insurers " that come to see them after the fact . like most elder law attorney's i would bet the majority of their work is working with the self insurers who called it self insuring but really had no plan or segregated money . now the stay at home spouse is panicking .
I made a bunch of decisions when I retired in 2008 during the midst of the financial crisis that turned out well. Why? In part because folks like you who are far more financially sophisticated than I ever will be take the time to post various opinions and experiences. You, here, take so much time in several forums and deserve some appreciation and thanks.

For example, a current financial thread ... even though I don't follow your investing methods that you've self-educated (for your profession was in technology ???) is a primary driver behind my planning to drag out the old Bogleheads book (different philosophy, but probably the best starting point for her) to START my daughter on that process, on taking responsibility.

More ... back in 2008 what I found valuable was not to follow a specific financial guru (Cramer comes to mind, he went one way, I another on when to buy, sell) ... but to suss out the opinions of those like you on various financial forums (recognizing the role of institutions) believing this group would be representative of the buyers who at some point would drive the market. It's the old normal curve thing ... the larger the statistical pool, the greater the data input, the better the decisional base.

In the end, though, win some, lose some - but be prepared to pay the price, yes, by understanding the risk.
Reply With Quote Quick reply to this message
 
Old 02-25-2018, 11:25 AM
 
3,100 posts, read 827,905 times
Reputation: 1765
Quote:
Originally Posted by loves2read View Post
All I meant was that planning for the future requires specialized knowledge most people dont have
Some info available online or in books seems applicable to all--
Spend less than you make, avoid debt/credit, save in taxable and tax-delayed accounts
But people usually benefit from special knowledge
Getting it frim people who value your needs above their own is the crux of the connundrum
Just like the optimal retirement income is based on multiple income sources (social security, multiple types of investment accounts, perhaps a pension) ... and LTC draws from more than one stream (LTCi, personal savings, perhaps familial support or Medicaid) ... the same is true for the decision process (self-education, professional input, community resources/guidance).

Being single and female, I tend to have a lot of single, female friends - many of whom also had a child or two. Between professional responsibilities ... familial obligations ... and even (let's be honest) the generational gap where women of my age did not have the financial exposure that hopefully the current generation does ...

you end up with many women who through no "fault" of their own are hesitant to plunge into the financial pool.

In several ... and this has nothing to do with intelligence, or underlying capability (one who comes to mind is an attorney at a top-ranked law firm) ... I see this tendency to personalize the relationship with the financial advisor ... the statements that they've become friends, he (and often the advisor is a male) is really going to look out for me.

I just don't hear that from men.
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:


Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Retirement
Similar Threads
Follow City-Data.com founder on our Forum or

All times are GMT -6.

2005-2019, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top