ALTERNATIVE LONG-TERM CARE STRATEGIES

Not your typical

“night out” conversation.

Date Night

4 KINDS OF PEOPLE

1. Those that have been caregivers.2. Those that currently are caregivers.

3. Those that will be caregivers.

4. Those that will need caregivers.

Rosalynn Carter, 1997

PURPOSE

• Heighten Awareness

• Enhance Understanding of Options

• Assist Evaluation Process

WHY LONG-TERM CARE MATTERS

1.Provides Dignity Beyond $

2.Protect Assets

3.Helps Reduce Family Disruption

4.Plans for Care of “Healthy”

Spouse

5.Supports Financial Plan

PARADIGM SHIFT

Family Care-Giving Then

Family Care-Giving Now

CHANGING REALITIES

THEN

Hardening of the

Arteries

Senile

Rest Home

Live with Family

Pension

NOW

Dementia

Alzheimer's

Nursing Home

Home Health Care

401(k) IRA

THENChevy ’57

Rely Upon Family Self Insure – “Spend Assets”

NOWToyota Prius - Hybrid

1)Rely Upon Family2)Self Insure – Rely Upon Assets Accumulated3)Long-Term Care Insurance4)Hybrid Long-Term Care Concepts

SELF “INSURANCE”

What is most efficient way to spend down assets?

Example:

$500,000 – Stocks

$500,000 – IRA’s

What does long-term care cost?

LONG-TERM CARE POLICIES EMERGE Nursing Home “Insurance”

Mid ’70’s

Insure Unknowns:

Learning Curve for Carriers

Today: Fewer Carriers/Steep Premiums Jumps

L: Longevity H: Our Health

LONG-TERM CARE INSURANCE

Indemnity – Insurance Company pays claim

Example: 60 year old husband/wife Both Good Health 90 Day Elimination Period 5% Compound Inflation $150 daily benefit Annual Premium $3,800 and up Premiums may increase LTC Distribution – Tax Free

Tax Considerations – Talk To Your Tax Consultant

This is a hypothetical illustration and does not represent an actual investment. There is no guarantee similar results can be achieved. All guarantees are subject to the claims paying ability of the issuing insurance company.

HYBRID LIFE INSURANCE – LONG-TERM CARE

60 year old female, good health, non-smoker Premium: $50,000 (Repositioning Assets) No Elimination Period LTC “Balance” $250,149 Reimbursement – Insurance company pays you

back after expense incurred. Monthly benefit 4 or 6 years.

Monthly Benefit $3,474 (4 Years) Cash value accumulation No Surrender fees Death Benefit not taxable LTC Distribution – tax free

Example:

This is a hypothetical illustration and does not represent an actual investment. There is no guarantee similar results can be achieved. All guarantees, including optional benefits such as riders, are subject to the claims paying ability of the issuing insurance company.

HYBRID RETIREMENT ANNUITY – LONG-TERM CARE RIDER

60 year old female, good health, non-smoker Premium: $50,000 90 Day Elimination Period LTC “Balance” – Rising with Age 60 - $202,767 ($2,112/mo) 80 - $259,920 ($2,708/mo) Reimbursement – Insurance company pays you back

after expense incurred. Monthly benefit up to 8 years.

Cash value accumulation 9 Year Surrender Schedule Death Benefit – gains are taxable to beneficiaries. LTC Distribution – tax free Option to convert to future income stream instead of

LTC benefit

Example:

The hypothetical case study results are for illustrative purposes only and should not be deemed a representation of past or future results. This example does not represent any specific product, nor does it reflect sales charges or other expenses that may be required for some products. No representation is made as to the accurateness of the analysis.

All guarantees, including optional benefits such as riders, are subject to the claims paying ability of the issuing insurance company.

All optional benefits such as riders and bonuses are available for an additional cost. It is important to weigh the costs against the benefits when adding such options to an annuity/life insurance contract. The cost for riders varies widely but is generally between .15% to .75% of the account.

LONG TERM CARE AND HYBRID BENEFITS ARE THE SAME –

COVERING:

• Home Health Care

• Adult Day Care

•Assisted Living

•Nursing Home

KEY DIFFERENCES

Long-Term Care Hybrid

OTHER CONSIDERATIONS TO “HYBRID” STRATEGY

Cash Value Exchanges

Pension Protection Act and Annuities

Ohio Long Term Care “Partnership”

CONCLUSION No “Silver Bullets”

Process – “Plan Centric”

Always Have “Unknowns”

Health Care Issues Remain

Industry Adapts – New Options

Questions?

The information presented is not intended to constitute tax or legal advice. Please consult with your attorney or accountant for advice specific to your situation.

Securities and Investment Advisory Services offered through NFP Securities, Inc., member FINRA/SIPC , Kehoe Financial Advisors, LLC is not affiliated with NFP Securities, Inc.