Celebrating Life Insurance Awareness Month with love

We’re celebrating Life Insurance Awareness Month with love and we’re encouraging you to do the same. Take a look at the people you love and ask yourself if you’ve done enough to protect them from the “what ifs.”  What if something happened to you? Will your life insurance policy provide enough coverage for the family you leave behind? When is the last time you reviewed your policy? Now is a great time for a life insurance review. We can walk you through the options available to you to make sure you’re fully covered without overpaying for something you don’t really want or need. Life insurance planning needs to be done with a goal-based approach.  For example if you are only looking to cover a portion of time, maybe while you have dependent children, you shouldn’t over pay for lifetime coverage. Know your goal for any coverage that you are buying and then find the product that best fulfills that goal.  There are several types of life insurance including: Term insurance, which is cheap and meets short-term goals. Return of premium term, which is a little more expensive but gives you the option to take a paid-up death benefit or get a full refund of your premiums paid at the end of your level term. Universal Life in all of its variations can make sense for someone wanting coverage, flexibility, and the ability to grow tax friendly money within the policy. Whole Life insurance can be a good fit for the person who wants both permanent coverage and tax friendly growth ability. If you are worried about being a burden to your family because of Long Term Care needs and expenses there are even LTC riders (options) you can add to many types of life insurance. Group life insurance is a valuable asset and I believe, if you have it available, you should utilize it to a degree. I like group… | Read More »

Seven reasons you might need to spruce up your life insurance

Spring cleaning means sorting through paperwork, shredding some, and reorganizing others into appropriate files. It’s also the perfect time to review your insurance policies. Here are seven life changes that should prompt a review for effectiveness of coverage and appropriateness of premiums. If you answer yes to any of the following questions, we suggest you come in for an insurance review: Have you increased the size of your family through marriage, adoption or the birth of a child? If so, you may want to make sure you’ve purchased enough coverage and that your beneficiary designations are up to date. Have you decreased the size of your family through divorce or the death of a spouse? These are also life events that should spur you to update your beneficiaries and review the scope of your policy. Has anyone in your immediate family become disabled since you purchased your policy? If the financial increase is significant, the additional cost of care might prompt you to update your coverage. Have you lost a job, received a promotion, started a new business or expanded an existing one since you purchased your policy? Depending on your age, these changes in job status could affect your insurance needs, particularly if you now own your own business. Are you now a primary caregiver for an elderly parent or grandparent? Have your financial responsibilities increased due to this change? Is your policy close to expiring? Are you healthier now? Have you quit smoking or lost a significant amount of weight? If so, you could qualify for lower premiums. Life insurance policies tend to be items people purchase and store away.  This can lessen the effectiveness of the policy and eliminate the opportunity to save money on premiums. For these reasons, we recommend an annual review. If you have any questions or would like a review, our insurance specialist Matt Weyers would be glad to sit down with you… | Read More »

Top nine reasons to fund an HSA

For the past three years, I have gotten a notice from my healthcare provider that the policy I carry will no longer be available to me in the New Year.  Each year I find myself with a more expensive policy that provides me with less coverage.  But now, thanks to a savvy tip, I’ve figured out how to make my finances and healthcare work with each other.  How, you ask?  Three simple, sweet letters:  H S A. I am in a high-deductible health plan (HDHP).  My HDHP policy requires me to pay a deductible of $2,800.  As it turns out, as long as I have a minimum deductible of $1250 as a single person or a $2,500 minimum deductible for a family policy (which will be $1300 and $2600, respectively, for 2016), then I qualify for an HSA (Health Savings Account). An HSA allows a person or a family with a HDHP (high deductible health plan) to put aside tax free money that can be used to pay deductibles and other qualified healthcare expenses and won’t poof away into nothing if it isn’t used!  What a concept!  That just seems too good to be true! I have compiled a list of some important things to know regarding HSAs.  These are the top nine reasons my HSA is my new best friend: My HSA is tax deductible off of my gross income, which is awesome, and could even lower my tax bracket. My HSA resembles my Roth IRA since my principle grows tax free BUT, in addition, I get the fantastic benefit of receiving a current tax deduction. (NOTE: HSAs have contribution limits. For 2015, an individual may contribute up to $3,350; for a family, that amount is $6,650. People over 55 may add another $1,000 per year as a catch-up contribution). I can even have my HSA account managed by investment professionals to maximize its growth potential. If I don’t… | Read More »

Be careful where you retire. Not all Partnership programs are equal.

In an effort to encourage more people to purchase long-term care insurance, the Deficit Reduction Act of 2005 (DRA) created the Qualified State Long Term Care Partnership program. The program offers special long-term care policies that allow buyers to protect assets and still qualify for Medicaid when the long-term care policy runs out. If your LTC policy qualifies for this program it essentially doubles the amount of possible protection from that LTC policy; you not only receive the policy payout to cover the cost of your care, but you also avoid having those assets count against your estate if your policy runs out and you have to apply for LTC through Medicaid. Because these programs run through the state government, it is critical to consider where you intend to retire. Not all states have this program, and even some that do will not honor a policy sold in a different Partnership Qualified state. For instance, these eight states have no Partnership LTC program: New Mexico, Alaska, Hawaii, Mississippi, Illinois, Michigan, Vermont, and Massachusetts.  Not only do they not have the program, they also will not honor a Partnership qualified LTC policy sold in another state if you move there and apply for Medicaid LTC services. California has a Partnership program but doesn’t have reciprocity with other states and will not honor a policy from another Partnership state. All the other states have Partnership programs and have reciprocity with other Partnership states and will honor qualifying policies sold in those states. It is possible that the states listed above without Partnership LTC programs could develop them in the future.  As always things change in the government on a state and federal level frequently. Part of our job here at Winch Financial is to keep up with those changes to give the best advice our clients.  If you have a LTC policy that qualifies for the Partnership program in the state you… | Read More »

Hybrid LTC Solutions offer great options for custodial care funding

Planning for the possibility of being disabled and needing custodial long-term care services isn’t by nature a fun topic of discussion.  However, it is a critically important topic.  Even with the most careful retirement planning, LTC costs can devastate retirement portfolios if you haven’t come up with a strategy for disability in retirement.  Traditional LTC insurance is a very strong option for those who want to protect themselves or a spouse.  However, this product can have inherent flaws that many people can’t seem to get past. One of the main objections to traditional LTC Insurance is, “If I never need care, I have spent thousands of dollars and gotten no form of return on my money.”  This is absolutely true. Too many people think of traditional LTC as an investment when in actuality it is purely insurance protection. Another objection to traditional LTC is that premiums are not fixed and there is a high likelihood that premiums will be raised in the future. Even for those who are fine with the fact that the policy may never pay out a benefit, and with the relative certainty that the premium will increase, underwriting (medical records review) has been and will continue to be more difficult to pass. The LTC companies don’t want to subject themselves to undue risk.  What can a person do to get around these issues? Hybrid Life/LTC Insurance and Annuity/LTC solutions, in my opinion, are great alternatives to traditional LTC Insurance.  I have found some great hybrid options to offer our clients.  We have one product that functions like traditional life insurance but has a chronic illness rider that allows the insured to access the death benefit for LTC needs while living, as long they are deemed chronically ill and needing help with two activities of daily living by a medical professional.  This product is great because it doesn’t require the care to be provided by a professional… | Read More »