Earlier this week as part of LTC Coffee Break Espresso Shot, Michael and I shared a few reasons why long term care insurance (or at least planning for a potential LTC event) should be a part of every advisor’s practice.
Aside from the obvious reason (to provide a source of money for your client’s LTC needs), here are three for you to consider.
An insurance funded long term care strategy protects the incomes of both the client (insured) and the advisor.
An insurance funded long term care strategy can keep maximum assets under management when a long term care event occurs.
An insurance funded long term care strategy can represent another revenue stream.
A simple thought to cement this thought – if a client has $1.5 million in income producing assets producing $65,000 of income annually (assuming a 60/40 stock bond mix with income indexed for inflation of 3.5%), there is a 99% likelihood of the portfolio successfully funding that income for the life of the client. However, when a 2 year duration long term care incident is injected in year 15 & 16 at the rate of $100,000 per year, the likelihood of success is cut to 77%.
Think about what 2 years of care did to the capital in the portfolio. Why not insulate it using insurance and improve the likelihood of success back into the 90th percentile?
Simply, long term care planning is a win – win strategy where both the current and future incomes are protected for both clients and advisors.
Let’s talk more about LTC planning and funding strategies – contact me via email at kevin.fisher@oneamerica.com or text or voice at (678) 512-9627.
For product questions and illustration assistance – call Justin Fox at (844) 658-3725 or email at justinfox.isp@oneamerica.com
And, don’t forget to join Michael Florio and me every Tuesday at 10 am for a new episode of LTCcoffeebreak.com.
Fridays with Fisher 