Life insurance provides cash to your family and loved ones after your death. This cash (known as the death benefit) replaces your income and can help your family maintain their lifestyle by providing financial needs like daily living expenses, mortgage payments and college savings. What’s more, the life insurance benefit is federal income tax free.

Life Insurance is the foundation of a strong financial plan. Whether you’re young or old, married or single, have children or don’t, take a moment to consider how life insurance might fit into your financial plans.

Answering these questions can help you start the process:

• Who depends on you financially?
• How would they fare financially if you were gone?
• Could they pay for your final expenses? – funeral/burial costs, medical bills, taxes, debts, lawyers fees, etc.
• Would they be able to meet ongoing living expenses like the rent or mortgage, food, clothing, transportation costs, childcare, healthcare, etc
• What about long-range financial goals?
• Without your contribution to the household, would your surviving spouse be able to save enough money to put the kids through college or retire comfortably?

We at Pulse Financial review our clients’ insurance needs regularly.  Below are a list of life events that should trigger an insurance review.

• Marriage
• Loss of a Spouse
• Marriage or divorce of one of your heirs
• Birth or Adoption of a child or grandchild
• Major Career Change
• Retirement

It’s always a struggle when you lose someone you love. But your emotional struggles don’t need to be compounded by financial difficulties. Life insurance helps make sure that the people you care about will be provided for financially, even if you’re not there to care for them yourself.

Disability income insurance (DI), sometimes referred to as income protection, is exactly that – protecting your ability to earn a living. If you become sick or hurt and unable to work, you’ll receive payments based on your particular policy. This check will help you continue paying living expenses such as rent, mortgage, car payment, food, insurance, utilities, medical expenses and more.

Chances of missing work due to illness, injury, or pregnancy are greater than most realize.

• More than one in four of today’s 20-year-olds can expect to be out of work for at least a year because of a disabling condition before they reach the normal retirement age⁴.
• 5.6 percent of working Americans will experience a short-term disability (six months or less) due to illness, injury, or pregnancy on average every year⁵. Almost all of these are non-occupational in origin⁶.

The most common reasons for short-term disability claims are⁷:

1. Pregnancies (25%)
2. Musculoskeletal disorders affecting the back and spine, knees, hips, shoulders, and other parts of the body (20%)
3. Digestive disorders, such as hernias and gastritis (7.8%)
4. Mental health issues including depression and anxiety (7.7%)
5. Injuries such as fractures, sprains, and strains of muscles and ligaments (7.5%)

The most common reasons for long-term disability claims are⁸:

1. Musculoskeletal disorders (29%)
2. Cancer (15%)
3. Pregnancy (9.4%)
4. Mental health issues including depression and anxiety (9.1%)
5. Injuries such as fractures, sprains, and strains of muscles and ligaments (9%)

Disability income insurance is insuring the largest asset most people have, their ability to earn future income.  If you depend on your ability to work and earn an income, you need disability insurance. If you cannot respond to, “Who will take care of your monthly expenses if you become sick or disabled and not able to work?” you need DI.

https://disabilitycanhappen.org/disability-statistic/

Long-term care insurance (LTC insurance) is important coverage that provides valuable support and financial resources that help cover the cost of long-term care you might need in the event of an illness, accident, or through the normal effects of aging. By helping to protect your assets, and giving you choice and control over where you receive care–including in your home–LTC insurance helps you and your family face the future with confidence.
 

Who needs LTC?

Recent research suggests that most Americans turning age 65 will need long-term care services at some point in their lives.

Age - The older you are, the more likely you will need long-term care

Gender - Women outlive men by about five years on average, so they are more likely to live at home alone when they are older

Disability - Having an accident or chronic illness that causes a disability is another reason for needing long-term care

• Between ages 40 and 50, on average, eight percent of people have a disability that could require long-term care services
• 69 percent of people age 90 or more have a disability

Health Status - Chronic conditions such as diabetes and high blood pressure, an unhealthy family history or poor diet and exercise habits make you more likely to need care

Living Arrangements - If you live alone, you’re more likely to need paid care than if you’re married, or single, and living with a partner

Where is care provided?

Most long-term care is provided at home. Other kinds of long-term care services and supports are provided by community service organizations and in long-term care facilities.

Examples of home care services include:

• An unpaid caregiver who may be a family member or friend
• A nurse, home health or home care aide, and/or therapist who comes to the home

Community support services include:

• Adult day care service centers
• Transportation services
• Home care agencies that provide services on a daily basis or as needed

Often these services supplement the care you receive at home or provide time off for your family caregivers.

Outside the home, a variety of facility-based programs offer more options:

• Nursing homes provide the most comprehensive range of services, including nursing care and 24-hour supervision
• Other facility-based choices include assisted living, board and care homes, and continuing care retirement communities. With these providers, the level of choice over who delivers your care varies by the type of facility.  You may not get to choose who will deliver services, and you may have limited say in when they arrive.

Cost of LTC:

Below are some national median costs for long-term care in the United States (in 2019).

The information shown above is based on a specific scenario generated by the Genworth 2019 Cost of Care.  For more information and location comparison, visit genworth.com/costofcare.

Long-term care helps meet health or personal needs. Most long-term care services assist people with Activities of Daily Living, such as dressing, bathing, and using the bathroom.  It is important to take control of your long term healthcare and prepare for the large expense that accompanies most necessary, ongoing medical services.

Medigap Insurance

Medigap is Medicare Supplement Insurance that helps fill "gaps" in Original Medicare.  Original Medicare, parts A and B pay for much, but not all, of the cost for covered health care services and supplies. A Medicare Supplement Insurance (Medigap) policy can help pay some of the remaining health care costs, like:

• Copayments
• Coinsurance
• Deductibles

Some Medigap policies also cover services that Original Medicare doesn't cover, like medical care when you travel outside the U.S.

It’s important to remember Medicare part A and B do not pay all your medical bills in retirement.  If you are within 6 months of being 65 years old, we can help you assess your options for paying your excess healthcare expenses in retirement.