Dealing with Dementia

Dealing with Dementia

“I saw the bravest man in the world playing the hardest role of his life,” Robin Williams’ widow wrote in October of her husband’s dementia and the months leading up to his death in 2014. When his anxiety, personality changes and memory problems began three years ago, a “foundation of friendship and love was our armor,” Susan Schneider Williams said.

Her story likely strikes a chord among those caring for a loved one with dementia. The Alzheimer’s Association estimates that more than 15 million Americans currently are. And her words speak to their important role: to offer companionship and help in planning for the future.

In the early stages of the disease, you and your loved one can work together to make decisions regarding long-term care and financial details. When you know their wishes, it builds confidence for the path forward. That’s why it’s important to act when the first symptoms appear.

The warning signs

So, what can early-stage dementia look like? Experts say to urge someone to see a doctor if they:

  • Consistently struggle to find the right word or name
  • Have difficulty remembering names of people they’re introduced to
  • Lose their sense of time and place
  • Forget where they are or how they got there
  • Lose or misplace things of value
  • Have trouble planning or organizing

“What we did not know was that when these diseases ‘start’ (are diagnosed) they have actually been going on for a long time,” Williams said of her husband’s swift decline from memorizing an entire script to grasping for a single line of dialogue. It wasn’t until after the 63-year-old actor died that his family found out he had Lewy body dementia.

Taking action

When it’s time to step in, you don’t have to go it alone. Call a family meeting and determine who’s willing to pitch in with caregiving or managing finances. You should also ask your loved one to take you to a meeting with a financial advisor. There you can get expert help in ensuring all estate planning documents are up to date and make a plan for dealing with financial issues. You also might want to discuss the idea of establishing legal authority through a power of attorney, so you can help make important decisions.

Remember, too, that it’s important to get support for yourself. The best thing you can do as a caregiver is to stay physically and emotionally strong and get help when needed. You can always ask your advisor to coordinate with other professionals offering assistance, including your loved one’s financial advisor.

Next steps:

Talk to your professional team about:

  • Estate planning
  • Budgeting for long-term care
  • Planning for the possibility of cognitive decline

9 Reasons to Hire a Financial Planner for Long Term Care Insurance

In our previous blog, we talked about Alzheimer’s disease, including its medical prognosis, why planning is critical, the cost of care and who pays for it. If you have met with your financial advisor, as recommended, then you may have looked at several options. One such option is long-term care insurance.

What is long term care Insurance and what does it cover?

Long-term care insurance is designed to cover long-term services and supports, including personal and custodial care in your home or a community organization, or other facility.[1]

Long-term care insurance policies reimburse policyholders a limited daily amount for daily living services such as bathing, dressing, or eating. You can select a range of care options and benefits as per your needs. Most policies sold today are comprehensive. They typically allow you to use your daily benefit in a variety of settings, including:

  • Your home
  • Adult day service centers
  • Hospice care
  • Respite care
  • Assisted living facilities /residential care facilities /alternate care facilities
  • Alzheimer’s special care facilities
  • Nursing homes

In the home setting, comprehensive policies generally cover these services:

  • Skilled nursing care
  • Occupational, speech, physical, and rehabilitation therapy
  • Help with personal care, such as bathing and dressing

Generally, when a person has Alzheimer’s disease, it is too late for families to buy it. Preserving Medicaid’s long-term care safety net is thus essential. However, it is not the only solution to meeting long-term care needs. Recent changes in tax law have allowed for the deduction of long-term care expenses and help families who purchase long-term care insurance.

9 Reasons to hire a Financial Planner for Long Term Care Insurance and Planning

Long-term care insurance can be directly purchased from an insurance agent, a financial planner, or a broker. Some important points to consider[2]:

  • States regulate which companies can sell long-term care insurance and the products that companies can sell.
  • There are more than 100 companies offering long-term care insurance nationally, however 15 to 20 insurers sell most of the policies.
  • The best way to find out which insurance companies offer long-term care coverage in your state is to contact your state’s Department of Insurance.

If you are looking for a more holistic view of your finances and long-term needs, you may want to consider engaging a financial planner for purchasing your insurance plan from Munn & Morris Financial Advisors. Here are 9 reasons why a CFP is a good decision:

  1. Provide a thorough investigation of the best financial and policy option for your needs
  2. Compare policies and reads all the fine print
  3. Investigate the companies from which you are buying policies
  4. Recommend policies that can cut the cost of long-term care insurance by balancing years of coverage versus per day payment allocation
  5. Assures the insurance company has a person to notify if premium payments stop
  6. Authorizes someone responsible and to advocate when the time comes to use the policy or to file a claim to the company on your behalf
  7. Assists in recommending and apply for policy for you in time
  8. Investigates and recommends suitable options for shared benefit policies for couples
  9. Reviews long-term care plans annually and suggest options to change coverage or revisit your decision periodically

Munn & Morris Financial Advisors can help you with all your long-term care planning needs. Contact us today to schedule an appointment.d use a proactive approach designed to take action during market volatility.

[1] http://longtermcare.gov/costs-how-to-pay/what-is-long-term-care-insurance/

[2] http://longtermcare.gov/costs-how-to-pay/what-is-long-term-care-insurance/where-to-look-for-long-term-care-insurance/

Long term care checklist

In our previous blog, we talked about Alzheimer’s disease, including its medical prognosis, why planning is critical, the cost of care and who pays for it. If you have met with your financial advisor, as recommended, then you may have looked at several options. One such option is long-term care insurance.

What is long term care Insurance and what does it cover?

Long-term care insurance is designed to cover long-term services and supports, including personal and custodial care in your home or a community organization, or other facility.[1]

Long-term care insurance policies reimburse policyholders a limited daily amount for daily living services such as bathing, dressing, or eating. You can select a range of care options and benefits as per your needs. Most policies sold today are comprehensive. They typically allow you to use your daily benefit in a variety of settings, including:

  • Your home
  • Adult day service centers
  • Hospice care
  • Respite care
  • Assisted living facilities /residential care facilities /alternate care facilities
  • Alzheimer’s special care facilities
  • Nursing homes

In the home setting, comprehensive policies generally cover these services:

  • Skilled nursing care
  • Occupational, speech, physical, and rehabilitation therapy
  • Help with personal care, such as bathing and dressing

Generally, when a person has Alzheimer’s disease, it is too late for families to buy it. Preserving Medicaid’s long-term care safety net is thus essential. However, it is not the only solution to meeting long-term care needs. Recent changes in tax law have allowed for the deduction of long-term care expenses and help families who purchase long-term care insurance.

9 Reasons to hire a Financial Planner for Long Term Care Insurance and Planning

Long-term care insurance can be directly purchased from an insurance agent, a financial planner, or a broker. Some important points to consider[2]:

  • States regulate which companies can sell long-term care insurance and the products that companies can sell.
  • There are more than 100 companies offering long-term care insurance nationally, however 15 to 20 insurers sell most of the policies.
  • The best way to find out which insurance companies offer long-term care coverage in your state is to contact your state’s Department of Insurance.

If you are looking for a more holistic view of your finances and long-term needs, you may want to consider engaging a financial planner for purchasing your insurance plan from Munn & Morris Financial Advisors. Here are 9 reasons why a CFP is a good decision:

  1. Provide a thorough investigation of the best financial and policy option for your needs
  2. Compare policies and reads all the fine print
  3. Investigate the companies from which you are buying policies
  4. Recommend policies that can cut the cost of long-term care insurance by balancing years of coverage versus per day payment allocation
  5. Assures the insurance company has a person to notify if premium payments stop
  6. Authorizes someone responsible and to advocate when the time comes to use the policy or to file a claim to the company on your behalf
  7. Assists in recommending and apply for policy for you in time
  8. Investigates and recommends suitable options for shared benefit policies for couples
  9. Reviews long-term care plans annually and suggest options to change coverage or revisit your decision periodically

Munn & Morris Financial Advisors can help you with all your long-term care planning needs. Contact us today to schedule an appointment.d use a proactive approach designed to take action during market volatility.

[1] http://longtermcare.gov/costs-how-to-pay/what-is-long-term-care-insurance/

[2] http://longtermcare.gov/costs-how-to-pay/what-is-long-term-care-insurance/where-to-look-for-long-term-care-insurance/
Life-insurance-riders-can-pay-for-long-term-care

Life insurance riders can pay for long-term care

Life insurance has many uses, including income replacement, business continuation, and estate preservation. Long-term care insurance provides financial protection against the potentially high cost of long-term care. If you find yourself in need of both types of insurance, a life insurance policy that combines a death benefit with a long-term care benefit may appeal to you.

Here’s how it works

Some life insurance issuers offer life insurance with a long-term care rider available for an additional charge. If you buy this type of policy, you can pay the premium in a single lump sum or by making periodic payments. In any case, the policy provides you with a death benefit that you can also use to pay for longterm care related expenses, should you incur them.

The amount of death benefit and long-term care allowance is based on your age, gender, and health at the time you buy the policy. The appeal of this combination policy lies in the fact that either you’ll use the policy to pay for long-term care expenses or your beneficiaries will receive the insurance proceeds at your death. In either case, someone will benefit from the premiums you pay.

The appeal of this combination policy lies in the fact that either you’ll use the policy to pay for long-term care expenses or your beneficiaries will receive the insurance proceeds at your death.

Long-term care riders

The long-term care benefit is added to the life insurance policy by either an accelerated benefits rider or an extension of benefits rider.

Accelerated benefits rider–An accelerated benefits rider makes it possible for you to access your death benefit to pay for expenses related to long-term care. The death benefit is reduced by the amount you use for long-term care expenses, plus a service charge. If you need long-term care for a lengthy period of time, the death benefit will eventually be depleted. This same rider also can be used if you have a terminal illness that may require payment of large medical bills. Because accelerating the death benefit can have unfavorable tax consequences, you may want to consult your tax professional before exercising this option.

Example: You pay a single premium of $50,000 for a universal life insurance policy with a long-term care accelerated benefits rider. The policy immediately provides approximately $87,000 in long-term care benefits or $87,000 as a death benefit. If you incur long-term care expenses, the accelerated benefits rider allows you to access a portion, such as 3% ($2,610), of the death benefit amount ($87,000) each month to reimburse you for some or all of your long-term care expenses. Long-term care payments are available until the total death benefit amount ($87,000) is exhausted (about 33.3 months). Whatever you don’t use for long-term care will be left to your heirs as a death benefit.

(The hypothetical example is for illustration purposes only and does not reflect actual insurance products or performance. Guarantees are subject to the claims-paying ability of the issuer.)

Extension of benefits rider– An extension of benefits rider increases your long-term care coverage beyond your death benefit. This rider differs from company to company as to its specific application.

Life-insurance-riders-can-pay-for-long-term-careDepending on the issuer, the extension of benefits rider either increases the total amount available for long-term care (the death benefit remains the same) or extends the number of months over which long-term care benefits can be paid. In either case, long-term care payments will reduce the available death benefit of the policy. However, some companies still pay a minimum death benefit even if the total of all long-term care payments exceeds the policy’s death benefit amount.

Continuing from the previous example, if the policy’s extension of benefits rider increases the long-term care benefit (the death benefit–$87,000–remains the same) to three times the death benefit ($261,000), the monthly amount available for long-term care increases to $7,830. On the other hand, if the extension of benefits rider extends the length of time the monthly long-term care benefit is available, then the monthly payments ($2,610) are extended for an additional 24 to 36 months beyond the initial number of months (33.3) available.

Other provisions

Typically, qualifying for payments under a long-term care rider is similar to the requirements for most stand-alone long-term care policies. You must be unable to perform some of the activities of daily living (bathing, dressing, eating, getting in or out of a bed or chair, toilet use, or maintaining continence) or suffer from a severe cognitive impairment.

An elimination period may also apply: you pay for the initial cost of long-term care out-of-pocket for a specific number of days (usually 30 to 90) before you can apply for payments under the policy. As with all life and long-term care insurance, the insurance company will require you to answer some health-related questions and submit to a physical examination before issuing a combination policy to you.

Here’s a tip:
If you need long-term care insurance, you may be able to get it by exchanging an existing life insurance policy with accumulated cash value for a new policy with a long-term care rider. You can do this through a tax-free exchange, but you must also qualify for the new insurance policy as well. You might not get as much death benefit as you had under the original policy, but you’ll pick up the option of being able to use it for long-term care expenses.

Is a combination policy right for you?

Deciding whether a combination policy is right for you depends on a number of factors. Do you need life insurance and long-term care insurance? How much life and long-term care insurance will you need? How long will you need it? Will the long-term care part of a combination policy provide sufficient coverage?

Life-insurance-riders-can-pay-for-long-term-care-2A long-term care rider may not provide as many features as a stand-alone long-term care policy. For example, the combination policy may not cover assisted living or home health aides. It also may not provide an inflation adjustment, an important feature considering the rising cost of long-term care. The tax benefits offered by a qualified long-term care policy may not apply to the long-term care portion of combination policies, which could result in taxation of longterm care benefits received from the policy.

What if your life insurance needs change as you get older and you find that you no longer want life insurance protection? It’s not uncommon for people to drop their life insurance in their later years if there’s no compelling need for it, but if you surrender the combination policy, you’re also forfeiting the long-term care benefit it provides, usually at a time when you are most likely to need it.

And keep in mind that as you use your long-term care benefits, you’re depleting the death benefit–a death benefit you presumably wanted to pass on to your heirs or perhaps use to pay for estate taxes.

Finally, compare costs of combination policies to other forms of life insurance, such as term insurance, and stand-alone longterm care policies. Depending on your age and health, the cost for the combination life policy may actually be higher than the total premiums paid for separate life insurance and long-term care policies, especially if your life insurance need is temporary (such as income replacement during your working years) rather than permanent.

Life-insurance-riders-can-pay-for-long-term-care3

Disclosure Information — Important — Please Review

This information, developed by an independent third party, has been obtained from sources considered to be reliable, but Raymond James Financial Services, Inc. does not guarantee that the foregoing material is accurate or complete. This information is not a complete summary or statement of all available data necessary for making an investment decision and does not constitute a recommendation. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Investments mentioned may not be suitable for all investors. The material is general in nature. Past performance may not be indicative of future results. Raymond James Financial Services, Inc.does not provide advice on tax, legal or mortgage issues. These matters should be discussed with the appropriate professional.

Securities offered through Raymond James Financial Services, Inc., member FINRA/SIPC, an independent broker/dealer, and are not insured by FDIC, NCUA or any other financial institution insurance, are not deposits or obligations of the financial institution, are not guaranteed by the financial institution, and are subject to risks, including the possible loss of principal.