tag:blogger.com,1999:blog-89841712777876032922024-02-07T15:35:24.781-08:00The Long Term Care CalculationSteve English Teacherhttp://www.blogger.com/profile/04982238003427096594noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-8984171277787603292.post-9263354214145574992014-07-11T06:14:00.002-07:002014-07-11T06:14:51.598-07:00Looking at the numbers behind the LONG TERM CARE choicesImagine spending 10 years in a confined situation. If I need help to get through daily chores and get shopping done, what can I do?<br />
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I can set aside money and "self insure" and then I don't have to be "checked out" to see if I qualify. I can take the money to pay for my health care people.<br />
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OR<br />
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I can give $1200 a month to a company and they have the task of paying for my caregiver. <br />
$400 a day x 365 days = 146,000 a year. If I'm in capacitated for 10 years, that's 1.46 million someone needs to pay for.<br />
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I can set aside $700,000 and in 20 years it can grow to be $1.5 million.<br />
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OR I can give $1200 a month or $15,000 a year for the next 20 years to a company ($300,000) and they have to pay $1.46 million. <br />
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If I self-insure, I get the flexibility of deciding when I pay out.<br />
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If I pay $300,000 over 20 years to a Long Term Care provider, I have to fight and prove that I need the support to get my money. <br />
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What could I do with $300,000? That money is gone to the Long Term Care provider. I also have the possibility that I might never need Long Term Care. <br />
If I don't, I still have access ot the $300,000 in premiums that I would have paid because I have set aside the money and I can draw down the money anytime.<br />
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PLAN CURRENTLY<br />
Put 1 million with Hightower, let it grow for the next 20 years, perhaps at age 87 I start to need the support of $400 per day for a care giver, I can draw down $146,000 a year.<br />
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2015 give hightower $1 million<br />
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2033 Value is $2 million (or more) and I pay from that amount the $150,000 a year for my support.<br />
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2038 I've spent $750,000 over 5 years and my fund is still $1.25million. I can go on cruises!<br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgr8iq3Zx_cU2z1o7eSYi03bw9S6D6D5G2KLuuMRGmS-zeXPBg4drGEQdUNeflmM3TK1XugMDsncYnSm3wBegjtN_3uwIdJqpOELARn-xEBVCXcWztV4T-smp8cq60vVNUtYXAFjxm3_tE/s1600/Screen+Shot+2014-07-11+at+8.54.44+AM.png" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgr8iq3Zx_cU2z1o7eSYi03bw9S6D6D5G2KLuuMRGmS-zeXPBg4drGEQdUNeflmM3TK1XugMDsncYnSm3wBegjtN_3uwIdJqpOELARn-xEBVCXcWztV4T-smp8cq60vVNUtYXAFjxm3_tE/s1600/Screen+Shot+2014-07-11+at+8.54.44+AM.png" height="498" width="640" /></a></div>
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If I rely on the Long Term Care company, I continue to pay $15,000 a year between 2033 and 2038 so I pay out $75,000 (plus the 20 years of premiums of $300,000) and I can get the company to pay for my caregiver. <br />
Positives: someone else is paying the $150,000 a year<br />
Negatives: they got to use my money during the 20 years<br />
I've given away $300,000 to have this coverage.<br />
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<b><a href="https://www.ltcfeds.com/ltcWeb/do/assessing_your_needs/ratecalcOut" target="_blank">The Long Term Care Calculator</a></b><br />
https://www.ltcfeds.com/ltcWeb/do/assessing_your_needs/RateCalcResults<br />
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<b>Conclusion: </b>there is more flexibility in protecting and self-insuring.<br />
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<br />Steve English Teacherhttp://www.blogger.com/profile/04982238003427096594noreply@blogger.com0