It’s that time of year – do you have another family event this weekend? Whether it’s Mother’s Day, Memorial Day, a graduation party or a family reunion, our lives often revolve around visits with family.
However, longevity has introduced a new dynamic. Because we’re living into our 90s or even to age 100, our visits with relatives have taken on a new meaning – and often a new commitment.
I have an idea. The next time you visit your relatives, ask them some important questions about the future:
These questions we often leave unasked because they are sensitive for you and those you love. But, if you explain that you’re asking these questions out of love and respect for their future, I bet they’ll be willing to discuss their plans.
This conversation isn’t just about their future – it’s about yours, too. Today, people living in their homes longer than any past generation, and any needed care is often provided by those closest to them. It’s noble of you if you are willing to care for a relative … But have you thought about how it could impact your family, your career and your health?
Having a plan is half the battle. Paying for that plan is another issue. Thankfully, there’s an entire suite of private long-term care insurance options to help your relative receive the care they need and allow you to provide support (not the actual caregiving):
Your relatives aren’t getting any younger. Now is the time to begin the discussion so everyone can implement a plan for caregiving. You have to address the potential need, determine where you fit, and get your loved ones to embrace a solution that will work for the entire family.
So next time you visit, don’t just stop by – start the conversation. As they say, “You’ll be glad you did.”
Bryan Langdon is passionate about his work – protecting clients and their families. As Ash Brokerage’s national spokesman for long-term care and disability income, he knows it’s important for people to firmly believe in the solutions they are investing in or providing. That’s why he’s sharing the story of the powerful impact that insurance can create – and how the teams at Ash can help make it happen.
Friday the 13th is a few days away, but now is not the time to panic. On this day that’s so often associated with bad luck and superstition, it would be easy to focus on sad stories where the lack of insurance protection exposed consumers and their families to overwhelming risk.
Instead, let’s talk about how diligent advisors can collaborate with insurance specialists at Ash Brokerage to help clients protect their hard-earned assets. Insurance should be sold on need, not scare tactics, so let's take a look at some typical consumer insurance needs.
As executive vice president of life sales distribution, Bob Klein is responsible for all of Ash Brokerage’s life, long-term care and disability income insurance sales. He is driven by his desire to help others get the most out of their natural gifts, and he gets the most satisfaction from seeing others grow and succeed.
Do you have clients who are business owners? Then you should be asking them some key questions:
Nearly every business has key employees who are vital to its success – without them, the negative effects could be catastrophic. That’s why we’re having more conversations than ever about key person disability insurance. This type of coverage is critical to the planning process for business owner clients.
You may already be familiar with key person life insurance – that’s a great product, too. The key difference is the qualifying event. With life insurance, it’s the death of the key person, but with disability coverage, it’s a disabling injury or illness.
Either event could be devastating to the business, but there’s a much higher probability of being disabled during your working years versus dying. So, if your clients want to insure a key employee with life insurance, they should absolutely insure them with disability insurance as well.
As vice president of disability income and long-term care insurance at Ash Brokerage, Tim Kukieza knows coverage he helps place will dramatically and positively impacts clients’ lives when they need it most. His vast knowledge comes from more than 20 years of experience in the insurance industry, including working with a number a carriers before joining Ash Brokerage.
If you’ve ever seen the movie “Major League,” you probably remember it was about a baseball team made up of the biggest misfits anyone could put together. It was a team built to fail. (Spoiler alert: No, literally – the owner actually wanted the team to lose so they could move to another city.)
“Wild Thing” Ricky Vaughn had a great fastball, but, unfortunately, it was rarely a strike. Pedro Cerrano could hit a fastball into the next zip code … but couldn’t touch a curve ball. Willie Mays Hayes could run like the wind – too bad he couldn’t actually hit the ball so he could run the bases. Plus, manager Charlie Donovan used to manage a tire store … how could he manage to help this misfit team win?
The better question you may be asking is, “What does this have to do with long-term care planning?” Well, let me explain.
First of all, the players on this team were out for one thing: themselves. Their focus was on what was best for them individually, not what was best for the team. They were blind to their real problems. This was especially true for Vaughn – he was literally blind to the strike zone and needed glasses to focus! When the rest of the team realized they were set up to fail, their focus changed, too. They had to come together, drop their old habits, and start focusing on what mattered.
The same is true when it comes to long-term care planning. Both advisors and clients seem to be blind to what matters. I can understand why clients may be blind – we aren’t giving them the right tools (glasses) to focus on what they should really be looking at. As financial professionals, we have to make sure we’re throwing something they can actually hit, not lobbing in lazy pitches.
If we continue along this path, we’ll start walking in runs, losing games (sales), and the team (clients) may move to another city (advisor). So, how do we pitch so our clients can hit homeruns?
The next time you’re ready to pitch long-term care to your clients, grab your Wild Thing glasses and get focused – you’ll win more games and take your clients to the World Series. If you continue to lob your throws across the plate? You’re only setting yourself up to fail.
Chad Eyrich is proud to help keep families together with long-term care planning. He helps advisors and their clients avoid the potential financial devastation of an LTC event by providing strategies around traditional, asset-based and linked-benefit insurance. In addition to earning his Long-Term Care Professional and Certified in Long-Term Care designations, Chad has a life and health insurance license, and a property and casualty insurance license.
Editor’s Note: The need for efficient retirement planning is evergreen, so we decided to re-publish this post from 2015. We’ve updated the numbers, but the conclusion remains: a few differences may allow high-income individuals to take advantage of Roth benefits through the purchase of cash-accumulating life insurance contracts.
But, has anyone really analyzed these comparisons and their validity? Let’s take a closer look at why life insurance is often compared to Roth IRAs with additional benefits.
To qualify for a Roth IRA, your clients have to fall under income certain limits established by the IRS. If they’re married filing jointly, their income has to be less than $184,000 to qualify for a full contribution. If filing single, their income has to be under $117,000. In addition to income limits, Roth IRAs also have annual contribution limits – currently the limit is $5,500, but people age 50 and over can contribute up to $1,000 extra per year to “catch up” before they retire.
Life insurance, on the other hand, isn’t bound by any IRS income or contribution limits. Instead, it’s bound by insurable interest and medical qualifications.
In a Roth, your clients always have access to the basis without penalty. However, if they’re looking to access cash in excess of the basis before age 59½, they’ll incur a 10 percent tax penalty. There are exceptions for first-time homebuyers and qualified educational expenses, however.
With life insurance, your clients may incur surrender charges in the first 10 to 20 years, depending on the contract. Outside of surrender charges, there’s no penalty for accessing the cash value in excess of basis before age 59½. It’s important that early withdrawals are closely monitored, however, as they could affect the performance of the contract and create a tax liability if the policy lapses.
Life insurance policies are self-completing and provide beneficiaries a tax-free death benefit – which is greater than the account balance – should the client die before retirement. (Please note that life insurance has cost-of-insurance charges to provide this benefit.) With a Roth IRA, the account balance passes to beneficiaries and may be subject to taxes.
Beyond age 59 ½, both contracts allow the client to access the gain without paying capital gains tax. Neither contract requires a minimum distribution at age 70½ like a traditional IRA.
Life insurance and Roth IRAs have several similarities. However, a few differences may allow high-income individuals to take advantage of Roth benefits through the purchase of cash-accumulating life insurance contracts.
© 2018 Ash Brokerage LLC.