Myth Buster: Wealthy People Should Self-Insure Long-Term Care

November 16, 2015

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Design Your Custom Plan and Get Approved

Wealthy People Should Self-Insure Long-Term Care

c5a83c_17c1e636b1a64871ae06851a1fbabb7aWe hear it every day or read an article from a financial advisor that wealthy people don’t need to do any long-term care planning because they can self-insure. Many advisors dismiss or overlook the tax consequence that comes with converting assets to income. They also dismiss the drain on the portfolio that comes with a costly extended care situation. Due to changes put in place with the Pension Protection Act in 2010, wealthy people can now benefit from asset based plans that allow them to eliminate unnecessary taxes and protect all of their assets from the high cost that come with a long-term care situation.

Example: A client may have to sell off approximately $800,000 to net $600,000 to pay for care needs paying $200,000 in taxes along the way. Or they could set up a long-term care plan with $200,000 that would provide them more than $600,000 of tax-free long term care benefit and pay them back with interest if they never need long-term care. Wealthy people need to look at the advantages provided to them with today’s plans.

To see more examples like this, visit our examples page.

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