2 Ways To Fund Your Long-Term Care Insurance Policy
As you begin to grow older, you may find yourself needing more care than your family members or friends can provide. Moving into a long-term care facility ensures that you will be able to receive the medical attention that you require, and it also ensures that you will be able to have assistance completing daily tasks on a regular basis. The cost of living in a long-term care facility can be great, so many people are turning to long-term care insurance policies to ensure their family members aren’t responsible for footing the bill for these facilities.
Here are two simple ways that you can fund your own long-term care insurance policy to maximize the benefits it can provide in the future.
1. Tie your long-term care policy to your life insurance policy.
It can be nearly impossible to predict when your body will require you to move into a long-term care facility. Because of the variable nature of entrance into these facilities, planning for your long-term care costs can be especially challenging. You don’t want to waste money investing in a long-term care policy that you won’t need to access for quite some time, but you also want to ensure that you have proper coverage when the time to move to a care facility arrives.
By tying your long-term care policy to your life insurance policy, you can mitigate your financial risk. Your premiums are deposited into an account that funds both the life insurance and long-term care policies.
If you should pass away before you need to access long-term care, your beneficiary will be awarded the amount in your joint account. If you do need long-term care, money from the joint account can be used to pay for care-related costs, and the balance will be awarded to your beneficiary upon your passed. Tying your long-term care policy to your life insurance policy maximizes the use of your premiums.
2. Link your long-term care policy to an annuity.
Depositing a single lump-sum premium (or creating a short-term structured premium payment plan) into an annuity account that has been designated for long-term care can be beneficial.
Many insurance companies offer their clients the ability to combine long-term care insurance and annuity plans in order to help minimize financial risk. If you don’t end up needing care, then the premiums you pay will accrue interest just like any other annuity fund. If you do end up needing long-term care, then a monthly stipend can be paid from the annuity to cover you care-related costs.
Linking your long-term insurance policy to an annuity allows you to enjoy the benefits of tax-deferred and safe growth policy premiums.
Understanding how to fund your long-term care insurance will allow you to take advantage of the financial benefits these policies provide while minimizing your financial risk.