Uh Welcome to Finishing Well, brought to you by CardinalGuide.com with certified financial planner Hans Scheil, best-selling author and financial planner, helping families finish well for over 40 years. On Finishing Well, we'll examine both biblical and practical knowledge to assist families in finishing well, including discussions on managing Social Security, Medicare, IRAs, long-term care, life insurance, investments, and taxes.
Now, let's get started with finishing well. Finishing well.
Well, welcome to Finishing Well as Certified Financial Planner Hans Scheil. And today's show, I know you're gonna be so excited about it. How about long-term care insurance? But it's a ten thousand dollars a month. benefit for unlimited months.
I mean, like it will never stop. And so, as I was thinking about this idea of unlimited long-term care, there is a story in the Bible that's unlimited long-term care for us. And it actually started out in sort of the worst of long-term care situations. You might remember in the book of Ruth, there was a man by the name of Elimelech. Who had no long-term care plan.
And so his wife Naomi ended up a widow with no help. And not only that, but Unfortunately, both her sons Passed away shortly thereafter, and because of Elimelech's lack of planning and moving out of his country into Moab, they would appear to be destitute except. God provided a beautiful, amazing daughter-in-law by the name of Ruth. And Ruth And Naomi got together and formed a long-term care plan that was unlimited. But God was the one that blessed it and made it unlimited.
And it even is so unlimited that it helps us today in that they. Um, met Boaz, who could be a kinsman redeemer that would redeem. The property inheritance that was due to Naomi. Her original inheritance was due to her if she had a kinsman redeemer, which turned out to be Boaz.
So they had the child Obed. And Obed was the father of Jesse, and Jesse was the father of David, King David being in the line of Mashiach or the line of Jesus, as was Ruth and Naomi. And so very cool that we to this day have long-term care through Jesus Christ. Um unlimited because of Ruth and Naomi's long-term care plan. That's a mouthful, Hans, but really, really fun, I think.
Well, I think it's great. the way you connect these things. and pull it right out of the Bible. Yeah. Um So today we're talking.
about long-term care insurance and it's a Hybrid life long-term care policy. But we're going to be focusing mostly today on the long-term care benefits that you get out of it. And when somebody comes to me and they say, I want. the maximum plan. I want to see what it's going to cost.
to cover this risk about as thoroughly as you can. Yeah. And then I want you to explain the policy to me. And then you can explain the costs. and then we can decide whether I can afford it or not.
So when somebody really asks for the big blanket plan. And what we're just showing as an example today is covering two people, Mary and Joe. We're both 65. or in in good enough health. to qualify for this thing.
Now understand you don't have to be in perfect health. But you know if you had a heart attack in your history Um it needs to be longer than two years ago. Um To qualify, and then it needs to be under reasonably good management.
now and medications and Repeats and that kind of thing. I'm just using that as an example.
So you can have some things. that ail you and still get this insurance, but it can't be really major and current and going on right now.
So Barring that, we've got two people aged 65. And understand that you can get this policy all the way through age 80. 80 and 364 days. Um it's going to be quite a bit more expensive if you buy this thing at eighty. Um But just understand that there is a price on it.
And likewise, if you're under 65, Um and there's two of you, it's going to be less expensive.
So Let's move ahead and just talk about the benefits of the policy. Um Starting with You know, it's $10,000 a month. And that's $120,000 a year. of benefits that you qualify for. Yeah.
You know, you say, well, what's this going to pay for? It's going to pay for. Informal care, so that if you have. people in your family or somebody you hire on your own taking care of you. It's going to cover home health care.
which is where a lot of the home health care a lot of the care these days starts. is in the home. They use people use this insurance. stay at home. by hiring a home health care agency and they're going to come in and several days a week or perhaps every day for several hours.
and take care of you. It's also going to cover assisted living. Um an assisted living facility. Yeah, as well as a nursing home. Um And this $10,000 a month benefit is going to last on an unlimited basis for both you and your wife.
You heard that right, Unlimited. And I know that kind of hit you, Robbie, when you saw that, when you listened to the video the first time. Oh, it's amazing, you know, because it. you know, we always talk about that at at at your website, our cardinalguy.com, there's the seven worries tab.
Well, if one of your worries is like what happens if if my wife becomes a widow or my husband becomes a widower, I'm not there and all of a sudden here's this Dementia or some other serious, you know, form of need for long-term care. And you know My family, I don't want that all to be on our kids or that other situation, you know, that could that could form. This could go on no matter how long, you know, the Lord allows her to live. And and that just wipes the worry out. Like wow, there goes that worry because I have this.
And that's what a long term care plan I mean, that's what the planning does. And it and the beauty of it is like uh some of the income plans that we've we've talked about in the past, that here's an unlimited uh source that it's never going to run out.
Well, sure. And so that isn't the only benefit period. They offer unlimited is the best. But if we're going to start shaving some cost out of this policy, Well we can just Cap that at like four years or five years or between the two of them. about eight years and we said we could put a limit on it.
And that's going to take some of the cost out of the policy.
So what we wanted to do here is just show you and show our whole audience, everybody that's out there, is like what What kind of coverage is available? What's the best? And so the unlimited. Another piece of that is when you're writing the same policy. on a husband and wife.
And let's just say that we picked five years as the maximum. And a lot of people are going to say, oh, if I'm out here any longer than five years, I'll be dead or whatever. I'm just. That's a long time, and it is a long time. But if we have it on a husband and a wife, And we had a limit of five years.
That means one of them could use it for five years. and that's going to leave the surviving one with no coverage. Or one of them could use it for two years. and it's going to leave the surviving one with three years of coverage.
So understand when this is for two people and we got a cap on time. the first one that gets sick. has the healthy one, they're going to be caring for them. as well as watching them use up their ultimate long-term care benefit. And that's I've watched this many times.
It's just not a very good feeling. No, I I can't. I can't possibly imagine, but having had long term care for my mother in law, In other words, we were providing it. Uh it It was for over five years. And it went by really quickly.
In other words, five years is not a long time when it comes to somebody that's really sick. you know, hanging on, they can do it.
Well, especially in today's day and time. I mean, you read all the statistics and the the great incidence, the increased incidence. of dementia and Alzheimer's and You know, our brains becoming less effective. We we lose memory. Um There's this huge growth of that disease.
And I think that it's directly related to how long people are living now. I mean You know, I I think in in the past you know, especially men would have heart attacks. Yeah. It would either knock them down and kill them, or they'd last a few years and then they're gone.
So, a lot of men. didn't used to live long enough to get dementia. And in today's day and time, in a lot of situations, they're able to treat heart disease. Uh do a bypass Put people on medicines, and they're living a lot more people to a ripe old age. with these chronic conditions.
And now they're living long enough to get this dementia. And then Um You know, you start looking at it, did you have people use this stuff for like 10 years or longer? No, yeah. a lot of people and I I I can't tell you the number of friends I have that Head. triple bypasses and whatever fifteen years ago.
And and they're doing well. You know, stuff that never would have taken place twenty years ago, right?
Well, yeah. And so, you know, you take this policy and you say between a husband and a wife. Let's say one of them used it for 10 years with dementia, and one of them used it for five years. with something more traditional, that's 15 years. and you took $120,000 a year.
of benefits You know, that's going to be $1.8 million that this policy, the insurance company, is going to pay out for these people's care over their lifetime. It's pretty remarkable. Yeah, that's why that idea of unlimited. Really just just tells you that that worry's gone, but it also shows you the kind of exposure we really all have. whether we want to face it or not.
Um You know, if we're a couple, we have that kind of exposure that you could rack up easily, you know, $1.8 million in long-term care between the two of you.
So What's the plan? And self-insurance may not, you know, all of a sudden when you start hearing those numbers, it doesn't sound so easy.
Well yeah, and that's in tax-free benefits.
So, you know, in the second part of the show, we're going to. We're going to go over the benefits of this policy in a little more depth. And then we're going to get into the costs. and and and show you what this what this really takes up.
So Which I know it's a it's it It sounds You know, like an outrageous amount of coverage, but I think you're going to be surprised. It's not crazily expensive by any means. From my perspective, it's not.
So you're going to enjoy that. And it's a good time to remind you that this show is brought to you by Cardinal Guide, CardinalGuide.com. And there, as we talked about, you're going to have the seven worries tabs. And one of those worries is long-term care. And so if you go to that tab, you're going to find a.
A wonderful YouTube video with this exact same title, Long Term Care, $10,000 a month. unlimited months. with all kinds of show notes and charts and things that you can look at. for more detailed information along those same lines of long-term care. But also you'll find at the website the complete cardinal guide to planning for and living in retirement.
That's Hans' book, as well as his workbook. And of course, the contact Hans. And Tom page. It's all there at cardinalguide.com. We'll be right back with a whole lot more long-term care insurance.
The $10,000 a month Benefit for unlimited months. Investment Advisory Services offered through Brookstrone Capital Management LLC, abbreviated BCM. a registered investment advisor. BCM and Cardinal Advisors are independent of each other. Insurance products and services are not offered through BCM, but are offered and sold through individually licensed and appointed agents.
Cardinal Advisors is not affiliated with or endorsed by the Social Security Administration or any other government agency.
Well, welcome back to Finishing Well with Certified Financial Planner Hans Scheil, and today's show long-term care insurance with a $10,000 a month. unlimited benefit. Wow. For like $10,000 a month for unlimited months.
So Hans. you know, one of the things that we haven't talked a lot about is the fact that this is a life insurance policy.
So if you never use any of this stuff, at least it's not like you paid this money in and you're never going to see it again, right?
Well, it is. I mean the life insurance, that's the primary benefit is that People will look at this, that have the funds to do it. Maybe they've been self-insured to this point. Were they just saying I'll pay for it myself 'cause I've got enough money. And then you know when we start presenting a plan to them they say well what if i buy this and then We're both.
Hit by a truck and You know, we're out of here and we never collect a dime off it. Um What about that? And I say, well, you know, the short answer to that is the money that you paid in. is going to go to help somebody else. Uh who who didn't have such a quick and immediate demise.
I mean, the insurance company can't pay off to everybody. But on this insurance It's a $240,000 life insurance policy. for essentially two years of those benefits. that if you never use it between you and your spouse Um And when the second one passes away, your beneficiaries are going to be paid $240,000. Um tax-free.
Uh which is effectively a return of most of your premium.
Now Hold on that if you don't, you know, we don't want people saying, Oh, I'm not going to use it because I don't want to lose out on the life insurance balance.
Well, if you. used it for like three months. and you collected thirty thousand dollars. and your spouse didn't collect anything and then you both pass away. Um then they're going to deduct that thirty thousand dollars paid out in claims.
from the two hundred and forty thousand dollars and your heirs to get $210,000.
So another way to look at it. is your first two years of care. You're using up your life insurance. or and if you never use that care Um it's going to be paid. It's like a return of premium.
Right. That is helpful. It also serves another purpose, is that life insurance can never change the premium.
So by making it a life insurance policy, the insurance company is on the hook for these benefits. And they can't come back and ask for more premium 20 years from now. because they're paying out too much in claims.
So And understand with the life insurance, you're not buying this. For the life insurance. It's kind of an afterthought. You're buying this policy for the long-term care benefits. That's why we put it into financial plans.
Right. Let's go through the benefits just a little bit more. $10,000 a month. $120,000 a year. benefit period is unlimited.
It's covering two people. And then there's this indemnity benefit for informal care.
So In order to get the $10,000 a month, you have to pay a service provider. Either a home healthcare agency or an assisted living, and they're going to pay up to the amount you spent.
So if you hire a home health care agency And you only spend like $7,000 in a month. They're not going to send you ten thousand dollars, they're going to send you $7,000, they're going to reimburse you for what you spent. Same thing if you're assisted living rent.
Well 6,000 a month. Yeah. That's all you had for the month in expenditures. They're going to reimburse you the $6,000, not pay the $10,000 benefit.
So it's up to 10,000 a month. The end. But there's this indemnity benefit for informal care, and it's at 75%. That's one of the reasons I made it an even number of 10,000 a month. Yeah.
you wanted to take the indemnity benefit instead of the reimbursement benefit. you could collect $7,500 a month. And you could collect that for three years. without sending in any receipts, without proving you spent that much. They're just going to send you checks and you could.
hire informal caregivers. Um you could pay your Grandson, or your neighbor, or Somebody, maybe you want to hire your own private person. to do this kind of thing. you can take the 75% benefit and it's paid out as an indemnity. It's pretty nice.
Yeah, I you know, I could when I started working with you, Hans, I had no clue what the word indemnity meant. Mm. But But I can tell you, now that I know, it's like that's an important thing to understand about whatever long-term care or other types of insurance, when it's an indemnity, like you're going to get. The based on the fact that you just meet the criteria of which I'm sure you're going to go into in a minute. you know, like like boom, you don't have to come up with receipts or whatever.
You you're just going to have the money there available to get the care that you need, which is really neat when it comes to like you talk about, that you have a son or a daughter or or you know, that Is willing to do it, you know, they can be in reimburse for their time, et cetera, et cetera. Or granddaughter, whatever you got, right? That's correct. And so this is one of the questions. You mentioned it earlier that Just about everybody asks, they say, how do you qualify for this policy?
And a lot of times they're asking questions because they're thinking that the policy could be written in such a way that it's really hard to qualify for coverage. Yeah, and that used to be true in long-term care policies, but I'm going to give you a simple thing if you're shopping for long-term care policies. Or you're out there in the market looking for it, ask the person that's showing it: is this a tax-qualified long-term care policy. And most likely the answer to that is going to be yes. There's not too many companies selling non-tax qualified.
And so if it's tax qualified, The criteria for qualification. is identical from company to company because the IRS wrote the guidelines. And here's what it takes to qualify for a claim. Is you need to have human assistance. you know, I guess that kicks the robots of the world out of this thing, but it needs to be human assistance.
where you need help. performing two of the six activities of daily living. And those six are bathing, continents, dressing, eating, toileting, and transferring. Those six things and what I tell most people. is when I help you with a claim, we're going to use bathing and dressing.
because they're the most tangible things They're easy to prove. And you either need help or you don't. And most people that are applying for a claim on a long-term care policy. It's a given they need help taking a bath. It's dangerous for them to do it.
without somebody helping them. And the same thing with dressing. is that typically people that are in a claim situation They're going to need help getting dressed in the morning. And all you have to prove is two, so I'm going to. generally have the doctor or the licensed health care worker.
fill out the claim and just prove those two things. Just say she needs help. Bathing. and she needs assistance dressing. There you go.
I leave the rest out of it. Um So it's that. Or, and it's very important that it's or, you have a severe cognitive impairment.
So if you have severe cognitive impairment, You don't need to prove all the two of six, then you qualify anyhow. Does that make sense? Right. debentia or Alzheimer's, something along those lines, and you You know, once you're starting to have those situations, you don't it doesn't matter whether you need help bathing or or dressing, you have the other, so you qualify. And the reality is you do, but it just when you're filing a claim, it's important to keep things neat and clean.
and clear And you know, we help people. And so So it's one or the other, it's either the two of six. activities of daily living or the cognitive impairment. And then we're only going to put one of those two down. Yeah.
We're going to be just very clear. and have the healthcare instead of writing a book. And that's where we get in trouble with the insurance company. They go, you know, the doctor writes them a book. they're going to read the whole book and they're going to find something in there to give you a problem with the claim.
I don't want to hang up on that, but it's just this has the standard definition and. That's not going to be a problem if you really need this. the policy's going to pay.
Now, as we mentioned earlier, there's unlimited in terms of time.
So you you and your spouse can use this. for just for your lifetime. both of your lifetimes. Um It talks about the life insurance, which we mentioned earlier. The life insurance of this policy is exactly two hundred forty thousand dollars.
And it is a second-to-die policy, which means It's covering Mary and it's covering Joe. Yeah. Um until Mary and Joe. have moved on and passed away. there's going to be no life insurance benefit.
And if during the life of the policy, in your l both of your lifetimes, if Mary and Joe's lifetime, If they pay out $240,000 of benefits, For long-term care, there is going to be no life insurance. Um So And let me move on quickly to the premium before I forget those.
So you can buy this policy with a single premium. And the single premium is $244,000 a year. not a year, just a single premium one time. 2400. Because some of us don't know what premium means, but I do because I've listened a lot.
Sure. The cost of the policy is $244,000. One time, boom, you got it. And you're covered for, like you said, it could be $1.8 million worth of For the rest of your life, no further premiums.
Now that's not the only game in town. you know, are interested in this policy and you don't have near that much money and you say what's he talking about We can use IRA money. to purchase this policy. And we've talked about that before on the show.
So if we have 272,000 of IRA money. we can transfer that 272,000 out of the IRA. And move it to the insurance company in an IRA. And then they will part and parcel that over 10 years. to create this exact same policy.
So it's an additional about $30,000. of IRA money. in total IRA money, you can buy the same policy. Show us. And then when we move off of IRA money, if you wanted to pay for this over time, It's twenty one thousand a year for twenty years.
34,000 a year for 10 years. sixty four thousand a year for five years. And then, of course, I told you the 244,000. I've used round numbers there. And this is for the Top of the line policy.
And so we start there. And if you're just one person.
Well, then obviously it's going to be half. Um If you're a man, if you're a woman, it's going to be about 60% of that. We want to remind you at this time that the show is brought to you by Cardinal Guide, CardinalGuide.com. And if you go to CardinalGuide.com, there are the Seven Warriors tabs in that. Today's worry that we're talking about is long-term care.
And so, beautiful show on YouTube with the same title, Long-Term Care Insurance, $10,000 a month, unlimited months. It's got show notes, charts, all sorts of information. But again, you might have a lot of questions. And we hope you do. And something that would fit your situation, your health, and whatever you got going on.
Believe me, Hans wants to help with that plan. And if you want to just go to cardinalguide.com, you're going to see the Contact Hans or Tom page, as well as, of course, Hans's book, The Complete Cardinal Guide to Planning for and Living in Retirement, and the workbook that goes along with it.
So, man, this is amazing stuff. And I know that it's really an integral part of how people can finish well, Hans. Yeah, thank you. It is. Yeah.
God bless you all. The opinions expressed by Hans Scheil and guests on this show are their own and do not reflect the opinions of this radio station. All statements and opinions expressed are based upon information considered reliable, although it should not be relied upon as such. Any statements or opinions are subject to change without notice. Investments involve risk and unless otherwise stated are not guaranteed.
Past performance cannot be used as an indicator to determine future results. Any strategies mentioned may not be suitable for everyone. Information expressed does not take into account your specific situation or objectives and is not intended as recommendations appropriate for you. Before acting on any information mentioned, please consult with a qualified tax or investment advisor to determine if it's suitable for your specific situation. Finishing Well is designed to provide accurate and authoritative information with regard to the subject covered.
Investment advisory services offered through Brookstrone Capital Management LLC, abbreviated BCM, a registered investment advisor. BCM and Cardinal Advisors are independent of each other. Insurance products and services are not offered through BCM, but are offered and sold through individually licensed and appointed agents. Cardinal Advisors is not affiliated with or endorsed by the Social Security Administration or any other government agency.
We hope you enjoyed Finishing Well, brought to you by CardinalGuide.com. Visit CardinalGuide.com for free downloads of this show or previous shows on topics such as Social Security, Medicare, IRAs, long-term care, life insurance, investments, and taxes, as well as Han's best-selling book, The Complete Cardinal Guide to Planning for and Living in Retirement and the Workbook. Once again, for dozens of free resources, past shows, or to get Han's book, go to CardinalGuide.com. If you have a question, comment, or suggestion for future shows, click on the Finishing Well radio show on the website and send us a word. Once again, that's CardinalGuide.com.
CardinalGuide.com.
