Okay, good afternoon everybody.
We got a couple minutes to before we start, but I just wanted to check on a couple of things. Uh, welcome Andrew and Ida and James and Sarah and Sheila. Susie, welcome. Hey, can you guys do me a favor because I I didn’t have my um normally I set this up where I can see it on my phone to make sure everybody if you guys can just somebody raise their hand if uh if you can hear me. Okay. And you can see the uh long-term care. Perfect. Thank you, Andrew. Thank you, Ida. We’re good. Um, that being said, if uh we got a we got a few minutes if people uh if you want to if you want to say hello. I’m going to take everybody off of uh allow everybody to talk. If you want to say hello or ask a quick question in advance. Hello Sarah. Hello Kelly and Amy and Julie. We got a good crowd today. Hello an
good to see you. Yeah, good to be here.
All right,
I’m free of porn. And I apologize if I uh if I completely butchered your name.
Welcome Steve. Welcome MK Mary.
Welcome Malcolm.
Welcome Braden. Welcome Nick.
All right.
Welcome, David.
I see you scheduled something, David, for Friday. Look forward to speaking to you then. Oh, hi, Bill. Good to see you. Yeah, I look forward to meeting with you.
All right, welcome Conrad. Welcome Mary. Welcome Pam. Welcome Pam.
Hello. Hello. All right, we’re going to get started in just another minute or so. Looks like we got a pretty big crowd. So, I’m going to
I’m going to take everybody when we get started. I’ll
I’ll take everybody off uh so that uh I’ll allow everybody to talk at the end as well, but All right.
Welcome, Colleen. Welcome, Conrad.
All right, looks like we got a pretty good crowd. I see a bunch more coming on still. Uh, but it is now 2 o’clock and I’m going to honor everybody who’s here on time. So, I want to honor your time. So, with that, uh, my name is Bill Rito. Welcome to today’s webinar. All the things you needed to know or didn’t know you needed to know about long-term care protection strategies.
Hold on. It looks like somebody Hold on. Okay. All right. I think uh All right. I think I got rid of the echo. Okay. Um so, as I said, my name is Bill Russo. I am the financial advisor for Northern California in uh for Alliant Retirement Investment Services. Um we have advisors all over the nation. Uh, I kind of want I’m I’m out of San Francisco uh just north of SFO, but um I cover well I have clients all over the nation as well. But for the most part, most of my clients are in the Bay Area, Nevada, Oregon, up through uh up through Washington, but I have I have clients everywhere as well. uh a lot in Arizona and Florida, which seems to be uh where everybody moves to in retirement. So anyway, all right. So, um for anyone, I see a lot of old faces here. I also see a few new faces here as well. So, with that, I’m going to give you a little uh insight in how I run our webinars here. Um I’m just going to go through before I get started. I’m going to go through just a few logistics. I apologize in advance if I sniffle and sneeze a little bit. I got a little bit of a cold that I’m not not killing me, but I’m I’m a little uh a little slower than I normally am. So, if I’m not as witty and quick as I normally am, well, that’s that’s probably why. So, um we appreciate I I appreciate any and all questions here. Uh when you have a question, though, there’s a there’s a way to do it. Um, you’re going to notice at the bottom of your screen is a um is a menu of a little control panel. You’re going to notice a Q&A and you’re going to c uh you’re going to notice a chat button. Either one of them, I have them up on my screen. So, when you get a question, as soon as it pops into your mind, type it in there. But be patient because what I’m going to do is I’m going to go through the whole presentation first. I promise you at the end I will answer any and all questions. So, as soon as a question pops into your head, ask put it down. The only question that’s a stupid question is a question that you didn’t ask because you thought it was stupid. And I guarantee that if you have a question, there’s two other people on the same webinar that have the same question that didn’t ask it because they thought it was a stupid question. So, ask away. So that’s kind of how this runs as far as um my disclosures go. Um I just have a today’s session is for educational purposes only and includes proprietary material. So protect both the content and everybody’s privacy. We ask that everybody here does not um pre-record capture the presentation whether by video, audio or screen sharing or AI tools without prior consent. Um I appreciate your understanding and uh I’m glad you’re here. So now that I got that uh disclaimer out of the way, I can take off my disclaimer hat. Okay. And the coming attractions are I do this every other week typically. So, every other Wednesday, um, and I’ll switch off between 2:00, which is now, and 6:00. So, the next one I have, I’ll be talking about estate matters, uh, principles of pres preserving your wealth. Um, that will be on Wednesday, July 29th at 6 PM where I’m going to talk about, yes, trust, but everything everything you need to know about protecting your assets at the end of life and uh whether it be IAS, um, you know, different uh different strategies on maximizing what goes to your heirs and not go to your uncle Sam. So, that comes up on Wednesday at 6:00 p.m. Stay tuned for that. And then, um, two weeks from then, at this same time, August 12th, I’m going to be talking about retirement, the fragile decade, which is essentially the the five years prior and 5 years after your retirement date. A lot can happen during that time and I’m gonna tell you specific actionable items that you need to be aware of before and after that time during that you know pretty pretty momentous decade of your life. So, that’s going to be happening on Wednesday, August 12th at 2:00 p.m. And if Wednesdays don’t work for you or they don’t always work for you or you don’t like the sound of my voice or the the my jokes or whatever, the good news is is that we have plenty of other advisors at plenty of other times that can help you with that. So, if you want a list of all of our webinars for the next two weeks, go to uh our website at aris.aliancreditun.com/events.
That’ll give you all the all the upcoming webinars for the next two weeks. If none of those times work for you or you happen to be up at 3:00 in the morning with insomnia, well, why not check out one of our podcasts that at least if it won’t put you to sleep, at least it’ll get you to learn something. So, that’s also on our website. Uh, it’s just the same website/mpodcast. And if you go to alliancreditun.com/ um slash our blog, there’s a link to our website at ARIS. ARIS is Alliant Retirement Investment Services. Um, we handle everything long-term. So, what’s long-term? Anything beyond 18 months. Uh, the reason why that is is because if you need the money earlier than 18 months, Alliance’s got some great resources with very competitive CDs and savings accounts and all that good stuff. But once you go beyond 18 months, you’re starting to compete with the long-term effects of money. Inflation. Inflation is the rate at which prices go up. Gas, food, housing, all that stuff. We’ve gotten a crash course on what inflation can do to the earning power of your money uh quite a bit over the last few years. So, what we do here is we help you plan and manage risk or plan for the major, you know, the major events in your life like retirement or college savings or whatever. Um, and we help you also manage risk. And we do that by planning. We do everything through planning. So with that, when we do a plan for you, we first take all of your goals, we prioritize them, we quantify them, and then prioritize them. And then we’ll take a look at everything you have to fund those goals. Whether it be uh your 401k, your pensions, social security, and we’ll take a look at everything, whether it be how often do you buy a car, do you like to go on vacation, we take a look at everything and just make sure that you’re on track to doing everything you want, and we’ll come up with strategies on when’s the best time to take your social security. Does it make sense for you to um you know convert your 401k to a Roth or and create a plan to do so? If it does, there’s a myriad of things. So, we do not charge for our services. The only thing it’s going to cost you is a couple hours of your time to do a plan. Um the reason why that is is because we are a nonprofit. Now, Alliant Retirement Investment Services is a nonprofit. It does not mean we’re a charity. What a nonprofit means is that any profits we do make, instead of paying off shareholders or lining the golden parachutes of our corporate executives, it goes back into our serving our members. So, with that, I’ve gotten all my pitches out of the uh out of the way now. So, let’s get on to today’s subject matter is long-term care. I know it’s everybody’s favorite subject matter. Um, but it’s really important. Now, one thing I telling you right up front, my job here is not to sell you long-term care insurance. You’re never going to hear a pitch from me to sell longterm care insurance on this webinar. Um, now that being said, um, long-term care is, even though, you know, yes, long-term care insurance, I can sell long-term care insurance, but that’s not the purpose of that’s not the purpose of today’s webinar. Today’s webinar is to get you to plan for it. And why is it so important to plan for it? Well, because you know many members of the baby boomer generation are now reaching retirement age. In fact, approximately 10,000 baby boomers turn 65 every day. A trend that is expected to continue through the rest of the decade. That works out to be one person every about 11 seconds. How fast is that? Well, in 2020, there was about three and a half working age Americans for every individual in retirement age. By fast forward 40 years, by 2060, there will only be two and a half working age Americans for every individual in retirement age. The median age of the US population is expected to grow from 38, which is what it is today, to 43 by60. So again, we’re all we’re an aging population is that’s a that’s a really, you know, long- winded way of saying we’re aging. So with that aging, it means that over 70% or about 70% are expected to need long-term care services at some point in your life. And now it’s difficult to predict, you know, the type of care one person might need or how long he or she will need it. Um, but statistics reveal that the average person needing long-term care will need it for about 3 years. Women are averaging a little longer at about 3.7 years to men’s 2.2 years. Probably because women live longer than men. So, stands to reason that that’s why women are in, you know, needing long-term care longer than men. uh and 20% of us will need care for more than 5 years. So, just a couple of I don’t say this to scare you. I say it to prepare you. So, here are the things we’re going to talk about today. Understanding long-term care. I’m going to talk about what it is exactly, how much does it cost, and what are your options. So, you know, since so many people are over the age of 65 and are expected to eventually need some level of long-term care, you know, let’s go into understanding about long-term care, how it works, and consider, you know, what you need to do to prepare for it financially. Okay, first question is, what is long-term care? Long-term care is a bunch of different things. Long-term care includes skilled nursing care such as rehabilitative care needed as after a long, you know, extended hospital stay, but it’s just one of the many types of care available. Long-term care also includes assisted living facilities, which is what most people think of long-term care. These are environments for individuals who can no longer function independently but don’t need daily care. These facilities offer occasional help um is what referred to as the activities of daily living. These include bathing, dressing, eating, transferring, getting in and out of bed or a wheelchair, and walking. So, typically, just to let you know how most long-term care providers work is if you need long-term care, you need to qualify for two of those six. So, if you need to, you know, if you need one of those, you know, hurricanes, you know, to help walk, you know, that uh if you need one of those or you you see those bedroom, those bathrooms with the bathtubs with the door on it, because any of those are typically covered, you need two of those six to be covered for the long-term care, the long-term care insuranceances that are out there. Um now in addition long-term care also includes home health care that is associated with occasional help that you know activities you know the activities of daily living that I just mentioned um as well as help with meals, budgeting, house cleaning, uh medication management, even transportation. Um, in this case, however, the help is offered by hired assistants who come to your home uh on a regular basis. So, give you give you a heads up that like uh just an example, my mom is 89 years old now. Um, so it’s kind of taken care of by, you know, her care. She’s she lives on her own, but she’s on um she’s she’s a couple blocks away from my my sister who kind of is on the front lines of making sure my mom’s okay because she’s at 89. She doesn’t really she’s forgetting some things here and there. She’s fallen a couple times and she forgets to eat sometimes. So, my my sister’s kind of on the um on the front lines of making sure that, you know, she takes care of the house, has someone come in uh well, we pay for someone to come in and clean and and do all that. My my sister kind of takes care of mostly everything, but we have someone come in and take So, that is all considered part of long-term care. And speaking of my sister, it also includes respit care, which respit care is the occasional break for family members who provide long-term care services. So, in my case, my sister’s case, you know, there is my my mom has a long-term care policy that provides respit for my sister periodically so that she can kind of take a break and we can hire someone to kind of help mom so that, you know, my sister can, you know, my sister recently just took a vacation out to see one of my I got five sisters. I got a lot of sisters. So, she went out to go see visit one of my other sisters. Well, we provided some this the care policy provided some help with my, you know, with my mom while my sister was away. So, there’s all sorts of things that are included in long-term care. It’s not just nursing home.
Okay. So, how much does long-term care cost? Well, that $64,000 question is a lot of times more than $64,000 and it really depends on where you live. So, the national average for assisted living centers uh single occupancy is around $50,000 a year. Um the average cost of skilled nursing facilities is much higher though at about at about $100,000 a year. Uh now obviously if you want to go, you know, if you want to go on the cheaper side of that, move to Utah or Missouri. Um where, you know, the costs are somewhat less than the sub than the national average. Unfortunately, New York and California are quite a quite a bit higher. Um, as you can see on here, I mean, New York is almost $150,000 a year for a long for a skilled nursing facility. So, whereas here in California, it’s going to it’s going to typically cost you around $10,000 a month on average.
So, and again, I don’t say this to scare you. I say this to help prepare you that this is an expense that most of us are going to need at some point. So, I’m not saying you need to buy long-term care insurance. I’m saying what you need to do is prepare for it and and allocate for it.
So, okay, what are your options for long-term care? Uh there are many. However,
your primary choice is typically between two options. Self insurance or purchasing a long-term care insurance policy. Now, I’m going to go through each.
Now, self insurance involves depending on your personal savings and investments to fund any long-term care needs. This would give you complete flexibility, but it requires that you are prepared to handle that potential expense. Now, remember that the national average for assisted living centers is about $50,000 a year. The average cost of skilled nursing is about $100,000 a year. Um, however, in California, which most people on this webinar are, it, you know, again, it’s higher than that. Now, excuse me. Um, self- insurance is a choice that many people make usually by default simply because they haven’t planned for long-term care expenses at all. So, if you if you don’t plan, well, you are planning this is your plan. You’re taking care of this for yourself. And as you see, self- insurance, self-insuring, you know, well, especially if you don’t plan for it, can have consequences.
Now, I’ll give an example of self-insuring for someone who did not really plan effectively. This chart shows a million-doll retirement for portfolio generating hypothetically about a 5% rate of return, which is usually what f you know us financial planners kind of divvy out as you know that’s how much you can that’s how much you can withdraw from your retirement without without affecting the principal for the most part. So with that, okay, if this is generating five 5% rate of return, it assumes that the six a 65year-old couple will be withdrawing $50,000 a year adjusted upward of 3% per year to account for inflation. Okay. If all goes well as planned, the retirement portfolio has a potential to provide income until the couple reaches 92 years old. Okay, great. However, if one of those spouses spends five years of his or her retirement in a nursing home, well, now the portfolio’s income potential changes dramatically. The hypothetical example assumes that the couple will spend $117,000 a year adjusted upward of 3% for inflation during the 5 years cuz you know we’re in California or I’m in California. So as you can see if they don’t make any changes their funds are going to be exhausted by the time they reach 83 years old. Now again I’m not saying this to scare you. I’m saying this to prepare you that you just need to there are ways to prepare for this. Um, stay tuned. I’ll get to that before we end. Okay. Now, the first question I usually get is, well, wait a second. What about Medicare? Medicare does cover some some long-term care, but it’s only a partial solution to the longterm care problem. Medicare actually does cover some skilled nursing home care under very tight restrictions. You have to have stayed in the hospital for 3 days first and then be discharged directly to the skilled nursing facility. However, Medicare doesn’t pay for custodial care. And under these conditions, Medicare will cover the first 20 days completely. So for the first 20 days, okay, you’re good. The next 80 days, it will cover all but a deductible. And after 100 days, it doesn’t cover anything. So you’re covered for a little over 3 months somewhat. This assumes, of course, that you find a skilled nursing facility that accepts Medicare and you meet the other conditions that Medicare imposes as well. So, it’s a little bit of a limited choice as well.
Okay. Now, long-term care insurance. Now, there’s a bunch of different ways to get to have long-term care insurance. Um, what long-term care insurance is is it’s it’s a way to transfer the financial risk of long-term care to an insurance company through either long-term care insurance. There are also some annuities now that offer long-term care benefits as well. So, if you don’t qualify for um traditional long-term care insurance, um you know, there are other options for you. Uh a long-term care care policy can cover all levels of care from from skilled care to custodial care to inhome assistance. Uh many find it to be an appropriate way to protect themselves and your loved ones from, you know, obviously the potentially devastating costs of of long-term care.
Why is it going to the next page? Okay. So, now there are a number of pros and cons to long-term care policies. On the pro side of ledger, um, long-term care insurance policy can obviously protect your assets. You won’t need to dip into your retirement funds to cover the cost of care. Great. Um, and under certain circumstances, your premium may be partially or completely deductible. Um, that being said, there are different types of policies out there. Some of them you can pay up some of them because that’s that’s a problem with a lot of long-term care. Um well, hold on. I’ll stay tuned. I I’ll get to that at the end of this. Let me get through this first. Um long-term care insurance also offers other advantages as well in in the event of long-term care illness. Um you know, it’ll enable you to obviously preserve your dignity. you can maintain your standard of living as for as long as possible and primarily your independence. Um, you can also preserve your choice. You can keep from, you know, becoming the burden on your family if if that’s important to you. Um, some people figure, hey, you know what? You were burden on me for how long. Now it’s your turn for me to be a burden on you. U, my sister would say, my mom’s not being a burden at all. We don’t think that. But um it is certainly it is certainly something that all of us as a family, as I said, I got five sisters. We’re all helping out, not just, you know, not just with um you know, my sister’s kind of on the front lines, but we have people coming in and helping her out as well. Um, that being said, on the cons side of the ledger, um, you need to be comfortable with the cost of premiums or at least have a set amount set aside to take care of the cost of doing so. Um, now there are some sorts of policies because here’s the problem. Here’s what I was going to get to earlier. Um, there are the big problem with a lot of long-term care policies out there is it’s not it’s not exactly a sexy investment. It’s something that you really hope you never have to use um you’re paying for it. if you know and if you pay for it um and never use it a lot of times at least the traditional long-term care insurance you’re paying for it can be fairly expensive and you know if you never use it it’s just an expense that’s gone you now there are other types of policies out there that there are a number of different things you can do there are annuity policies that you have the instead of having an income writer, you can have a long-term care rider. So that what’ll happen is the long-term care needs come out and it’s tax it is, you know, it’s tax-free um to take care of those. There are other um that come in a life insurance policy that basically will you pay it up in advance. So, let’s say you have $200,000 sitting in checking in savings or CDs that are, you know, I’m probably not going to need this. It’ll probably go to the kids, the grandkids, but I got it there just in case. And if that just in case is I need it for a long-term care event, which is usually the just in case that most people come up with, well, that two or that 200,000 that you have in that account for that just in case, well, you can put it into an account which will give you leverage on that. So if you need it, you can pull it out usually after four or 5 years or so. Um you know, you can pull it out. However, um if you need the money, take it out. It’s available to you. However, it’s the last money you want to touch. Why? Because if you leave it in there, that 200,000 can become 3400,000 of tax-free uh tax-free uh long-term care coverage. So, and if you don’t ever use it, well, then what happens is is that it will um the 200 will typically go tax-free to your heirs. Now, you’re not making a ton of interest on it because essentially the interest is essentially paying the long the cost of long-term care, but you’ll get like it depends on your age and and whatnot, but you’ll typically get the 200 will provide like between 230 and 250 that will go to your heirs if you never need it. So, that being said, this and and again, I’m not trying to sell you a long-term care policy. I’m just trying to show you that there are many solutions out there to help you get to get to your end goal, which is covering your long-term care needs. Um, so that’s the one cost. Uh, the cost of premiums is obviously a con. The other thing is is that there’s a wide range of benefits and premiums available on a lot of these policies and you got to be an informed consumer because you don’t want to be paying for something that you’re very unlikely to use. Um, and there are you want to you want to have someone who’s going to shop for you because different insurance co companies judge different ailments differently. So there you go. So, with that, that kind of covers the pros and cons of long-term care policies. Um, now, when you’re choosing a long-term care policy, you need to bear in mind a few things. Number one, you need to make sure you understand the limitations and the features of the policy that you’re considering. Uh, in most cases, policy holders cannot collect their benefits until their disability reaches certain levels. Remember I talked about two out of the six uh functions of life. Usually that’s the certain level that that qualifies. You got to you got to qualify for two of the six daily functions of life. Um and most most policies will specify how much they will pay for either each day of care and for how long. So, you want to make sure that you know how long you’re covered for and your total amount. Um, second, take a close look at the type of care covered. Long-term care policies can cover everything from skilled nursing care in a nursing home to periodic uh custodial care in your own home. You need to understand exactly what’s covered and what is not covered. Third, you want to look at the total benefit. uh you don’t want a policy that’s going to run out of benefit just when you need it most. Um you also don’t want to pay for coverage that you’re unlikely to need as well. So, you know, again, it’s it’s really all about planning. Um you definitely uh oh, look at the waiting period for benefits and uh when they’re scheduled. They’re usually going to have a a a period of usually it’s 90 days where you got to wait 90 days to get in. Typically because especially in California, it’s because that’s when Medicare kind of covers that first 90 days. So the first 90 days is a waiting period for them. You’re not going to be able to collect until Medicare kind of takes care of their portion. Um, you also may want to consider um inflation protection because the cost of health care has been rising a lot more, especially in recent years than the rate of inflation. Um, and you also want to consider a um a policy that has a waiver of premium. This means that your premiums are discontinued once you start drawing benefits. You don’t have to pay into the policy anymore. now you’re collecting it. So, all things to consider. Um, an important thing, one more other thing about long-term care policies is that, um, uh, is that, sorry, I just got a question that I kind of threw me off track here for a second. Um, the other thing about long-term care policies is, you know, ultimately, here’s who it’s not for. Long-term care policies are for people who have a lot of money or no money. Why? Because if you have no money, well, then, well, the government will take care of you. Now, you may not like the way the government takes care of you, but they will take care of you. um you know, they will they have facilities that are set aside for but the problem is is that you can’t have any assets to get in them. You got you can’t have more than $2,000 a a month income to get into those facilities. Now, on the other end, if you have a ton of money, you do not need long-term care insurance because hopefully you’ll have like in in the case, you know, in in a case of my mom specifically, she’s got some coverage, but she doesn’t have a ton of coverage because and it’s really to cover a few of the she’s got a small policy that covers the cost of inhome care and things like that. The reason why that is is because for the most part, she’s got enough assets where they’re generating if she really needs to go into a long-term care facility. Well, at that point, her assets are going to cover that portion of it. She’s got enough assets to generate enough income to pay for that. Um, so if you have a lot of money, you don’t need long-term care insurance. You still need to plan for it, but you don’t necessarily need long-term care insurance. It’s for the people in the middle that really long-term care insurance is for. If you know, if if a long-term if you’re all set and everything’s good to go and you know what, we’re we’re pretty good with retirement. But if one, especially if you’re part of a couple and one of you gets sick and it’s going to really dwindle the retirement savings for the other one, that’s when you need to plan. You really need to plan for how you’re going to take care of long-term care insurance. So, like anything, it’s not really um you know, planning is you can do anything as long as you plan for it. So, with that, um, you know, there are a number of long-term care planning strategies. Um, I can go through them with you. Um, but it’s really to cover everyone from couples to, you know, families to your your loved, you know, the the your younger loved one or we live in a sandwich generation where, you know, we’re taking care of elderly parents and raising kids at the same time. So, um, all of these I can help you with all of these different strategies. Um, now that being said, if you do want to do a plan with me, um, not necessarily a will and trust plan, but, um, if you want to do a plan, um, feel free. We’re here to help. Whether it be, you know, take a look at, um, you know, with with this, this is, um, Will and Trust is is a provider that we work with, um, that can kind of help you kind of get your estate and things like that in order. This is really a plan for excuse me. Um, you know, it’s someone we work with. We’re not I’m not promoting it. I’m just saying that we can help kind of walk you through if you want to do estate planning or anything like that as well along with if you want to set up a financial plan or do some long-term care strategies. you know, it doesn’t cost anything to sit down and talk with us um or to talk with me. So, with that, if you would like to talk, uh hold on a second. Um I’m here. Uh you can there’s a couple ways to do it. You can either and I promise you I will answer all questions. Um I see we do have a quite a few questions up here. Um, but if you want to sit down with me before I answer the questions, um, there’s a couple ways to do it. You can either scan this QR code that’ll take you directly to my calendar where pick a pick pick a time that works for you either via Zoom or phone um, and you’ll reserve that right on my calendar. Or what you could do is you could um uh just click on whether or not you would like an appointment with me and I’ll contact you. If you do that, do me a favor. Put in the uh chat or Q&A. Just put down either email or phone. It lets me know how you best want to be contacted. So with that, okay, um let’s get to the questions. Uh Julie, you are very welcome. She says, “I just want to say thank you and tell you how much I appreciate Alliance webinars.” Well, we’re here to help. Okay. Um she also mentioned, “Yes, San Francisco is averaging $14,000 a month for skilled nursing facilities.” Um, it can be especially if you’re in a um especially if you’re in a uh Oh jeez, I was going to mention it, but I forgot it. An Alzheimer’s um uh an Alzheimer’s facility, they can really be really expensive. Um that being said, okay, so next question. Um
Ann asks, “What do you consider a lot of money?” Well, that depends on you. Um you know, it depends on everybody. A lot of money is, you know, so when I say a lot of money, it really depends on what your needs are. If what I do is I cover when I do a plan, I’ll cover what your normal living expenses are. And then what I’ll do is I’ll do the whatifs. What if we have another 2008? What if you have a long-term care event? What if we have um you know what whatever it may be, right? So what I’ll do is I’ll first run the scenario with with just if everything goes right do your does your income meet your expense needs. Okay, once we get that and say, “Okay, hey, you have a 85% success rate of living the rest of your life and never needing any money any great. You’re right in the bullseye. Fantastic.” All now 85% cuz a lot of people ask me, “Well, wouldn’t I rather be at 100%.” No, 85% is the number you want to be at. The reason is it doesn’t mean that you’re going to get 85% of the way to your goals and then run out of money. It means that there’s an 85% chance you’re going to live well into your 90s, do all the things you want to do in life, and still have money left over. So, if you’re at 90 or above, what it’s telling us is one of two things. Either one guys, you can relax a little bit, fly first class, you know, buy that buy that luxury car if you want, or if you come back and say, you know what, Bill, I’m living my best life. I don’t need anymore. Great. then we can get to the same place with less risk. Okay. Um but then what I’ll do is once I make sure that you’re okay to live for the rest of your life without worrying about, you know, running out of money, well then we take a look at the whatifs. Well, what if we have another 2008 in this case? What if you have a long-term care event? Okay, what is that going to do? Remember the couple that we had where they were all set? They were going to live until 92 years old without running out of money. And then one of them got sick for five years. And now all of a sudden they’re eating ramen for the last 10 years of their life or one of their lives cuz the other ones, you know, no longer eating anything. But you see my point. So that’s one of the things I do with how much. It depends. It depends on what your needs are and where you live and how much you’re going to need for long-term care. It’s just scenario planning. So that’s one of the things. So when I say a lot of money, it that’s what I mean by a lot of it just depends. Okay. So hopefully I answered your question and all right. David asks, um, okay, he said, I went to an alliant workshop. I went to an Alliant workshop a couple years ago and they mentioned an annuity or something where you could put in $100,000 and have $300,000 for long-term care if you need it. Can you tell us more about that? Yeah, it’s um it’s essentially an Well, there are a couple of ways to do it. You can do it in a life insurance chassis, which is what I mentioned earlier. Um, you can also do it. There are certain types of annuities that do that as well, which will give you a certain amount of essentially what you’re doing is you’re getting a you’re getting an additional rider on it. So, it’s typically like an income writer or something like that. In this case, it will it will grow tax deferred like an annuity, but if you need it for long-term care pol long-term care purposes, Yeah. then you get leverage on that. Now, you’re essentially buying that leverage, but there are ways to do it. So, yeah, I mean, it depends. There are many different things out there. Um, when we talk on uh I’ll tell you a little bit more about it on Friday when we talk, David, cuz I know you have an appointment scheduled for me. But hopefully I I gave you enough information for everyone else that, you know, at least you can know what to look into. Um, all right. Next question is from Wayne. Uh, and and if I didn’t answer your question, feel free to follow up in the in the chat. Um, all right. Next question is from Wayne. Is a joint policy preferred to an individual policy? Should I pay with cash or qualified money? And finally, should I pay with cash or Oh, hold on. Uh, okay. I think he repeated the should I pay with cash or qualified money? Um, I appreciate your comments. Okay. Um, it depends. The joint policy is a joint policy preferred to an individual policy. It really depends on the differences and ages of the two people on the joint policy. So, what I would do is I’d run scenarios on both to see what’s best for because if one of you’s, you know, if you’re a couple, one of you is 20 years older than the other one, well then, yeah, you shouldn’t do a joint policy on both of you because, you know, well, well, it depends. You’re going to be paying for the older person’s you’re going to be paying for the older person’s uh premiums. So it again it would depend on your scenario. So make an appointment with me. I’m happy to I’m happy to sit down with you individually and see uh Wayne, you know what’s right for you. Uh that being said, would you should you pay for it with cash or qualified money? And again, it depends on your it depends on your tax situation. Uh most of the time I would say you don’t want to pay with qualified money. Uh you don’t want to pay premiums with qualified money unless you’re doing it through an RMD or something like that. Um but then again, I’m putting on my disclaimer hat again. I’m not qualified to give tax or legal advice. For tax or legal advice, please talk to your qualified tax or legal professional. Um, but I’m happy to go through that with you individually, Wayne, and uh kind of look at your plan and see what works best for you. So, with that, um, I I don’t see any more questions, but I’m going to stick it on for a few more minutes if any new questions come aboard. Um, with that, I usually try and keep these down to an hour, so um, I’m going to be on for another 13 minutes or so at least. Uh, I’ll open it up if people have, you know, if people just want to say hello or have other questions in there. Um, but with that, um, I thank you all for your time. I hope that you got some information that you can take some, uh, you know, you can take action on. So, with that, feel free to give me a call if you want to do a if you want to do a plan or just have a question in general. Doesn’t doesn’t cost anything to set an appointment and ask me with that. Take care everybody. Have a good afternoon. Oh, okay. A couple more questions just came in. Um, okay. Isn’t it super expensive? Deb asks, uh, “Isn’t it super expensive to buy long-term care insurance if I’m 64?” It depends. It depends how much coverage you need. It depend It depends on your health. don’t take my, you know, I just have a cold. It’s nothing contagious, but um usually most people, most long-term care policies are issued be between the ages of 60 and 75. So, you’re actually right in the wheelhouse of when most are, you know, when most uh at 64, you’re in the wheelhouse of when most policies are issued. That being said, it depends. Um, what I would say is, Deb, you know, sit down, we’ll make a plan to one, see if you even need it because you may not need a long-term care policy. Um, and there are ways to do it where it won’t necessarily cost you anything except possibly the interest that you’re earning on that checking or savings account. And it gives you leverage because let’s say that you have $200,000 or $100,000, you know, for what if money, right? And it’s sitting in a checking account or a savings account earning 2 or 3%. Okay. Well, you take that and you get, you know, that you turn that 100 100,000 into, I don’t know, 1752 250 somewhere around there of tax-free money. How long would it take your $100,000 to double and turn it into $200,000 tax after taxes? So, there are a number of ways to do it. Um, again, I’m not saying that long-term care insurance is the way to go. I’m just saying you want to plan for it. And that’s that’s what I’m here for, to help you create a plan. And whether or not long-term care insurance is the right way to go or not, there are many things you can do to fund it. But, um, it’s important to create a plan. So, there you go. So, with that, uh, okay, you’re welcome, Ann. You’re welcome, Chris Charles. You’re welcome, Chris. And I look forward to seeing you on Friday, David. All right. So, with that, um, again, I’ll be sticking around for a little bit longer. Um, if there are any as as just came in, if there are any straggler questions coming in, I’m here to here to help.
and I’ll open up uh I’ll open up the lines in case people have other questions. If you want to talk to me, just hit your mute uh the microphone and talk away.
Deb asks, do I do any face-toface inpersons meeting? I love to face toface in-person meetings, Deb. Unfortunately, nobody ever wants to anymore. But yes, you can come see me. My office is in uh my office is um in Oyster Point in South San Francisco, just north of uh the airport. Um I I do have clients that I do make house calls for. Um, so you know, make an appointment with me and we’ll uh, you know, give me a call and we’ll Yeah, I’d love to see you in person as well. I do I do see certain clients in person, but uh, about 90 90 95% of them want to do it on Zoom nowadays. But, uh, yes, I’m here and I’m happy to do it in person. Uh, probably not this week because I don’t want to give you I don’t want to get you sick, but anytime next week going forward. Absolutely. Love to meet you in person. De
Oh, thank you, Deb.
We’re we’re lucky to have my mom. So, thank thanks for the uh she’s she’s definitely she’s definitely put up with us for long enough, so it’s the least we can do.
And there’s thankfully there’s only one, you know, we we have five, you know, we’re not in it. My sister isn’t in it all by herself. So we have there’s six of us all together. So,
but I look forward to talking to you soon, Deb.