Alternative Long Term Care Solutions  

About 70% of retirees will need some type of long term care coverage.

I’ve had clients who have watched their parents’ entire estates taken for long term care (LTC) costs. 

Long term care policies are a “use it or lose it benefit", and that's the difficulty for most people.  If you pay for long term care coverage and suddenly die, the premiums are lost.  Only about 4% of the population have LTC coverage, yet 70% will require benefits during retirement.

My wife and I are under 60.  I recently received a price quote for long term coverage for $590 per month.  And that cost can go up, Ouch!

There are three new approaches to providing LTC coverage which may suit your needs better. 

A few life insurance companies (not all) can include LTC type benefits in their policies. 

Here’s how it works.  You purchase a $500,000 life insurance policy with LTC benefits.  If you cannot perform two of the six activities of daily living (dressing, toileting, transferring, continence, eating, bathing), your policy will pay up to $200,000 for long term care prior to your death and the remaining balance will be paid to your beneficiaries.  

If you die without needing any long term care, the entire $500,000 comes back to your beneficiaries income tax free. This is a win win not a use or lose situation.

Another alternative for covering a husband and wife is to purchase a “second to die” single premium life insurance policy for LTC. In this case, you could purchase a $300,000 policy that pays long term care benefits of $6,000 per month for 50 months on both the husband and wife. 

If the LTC benefits are not used, upon the second death $300,000 is paid income tax free to your beneficiaries.  If $100,000 is used for long term care benefits, $200,000 will be paid out at the second death.

Also newer annuity contracts can provide a doubling of benefits for long term care needs when you are not able to do two of the six daily living activities.  If your lifetime income annuity is already paying $20,000 you could get up to $40,000 annually for five years.

My clients who have watched their parents’ estate vanish and who wish to pass wealth on to their children find these policies a refreshing change to the use or lose it proposition.

If you'd like to discuss LTC coverage or the new alternatives available please give me a call.

Thanks,

Cory Payne

Beehive Insurance Retirement Planning Services

302 West 5400 South #101

Murray, UT 84107

801-685-6860 Office

801-554-7797 Mobile

801-685-2899 Fax

cpayne@beehiveinsurance.com

Beware of Too Much Risk in your Portfolio

I've heard it said, "Risk is for those trying to get where you are".

If you have it made with retirement assets, if you have enough money to successfully meet your retirement goals, then why not "protect" those assets so they will serve you all your retirement years.

Why put yourself in harm’s way?  Remember 2008?  Many people were ready for retirement but when they lost 50% to the stock market crash, retirement for many was postponed.

Do you believe there will be another financial catastrophe like the one in 2008?

Mark Twain said:“I am more concerned with the return of my money than the return on my money”.

After spending years accumulating retirement assets it can be hard to switch the mindset to distribution.  Many fixate on investment returns when they are really looking for a predictable and safe retirement income.

Stop acting like you need to capture every possible gain in the market.  Protect and insure your hard earned assets.  If you have enough money now, then carve off enough to protect your basic income needs for life without risking it all to another crash.  Doesn’t that make sense?

Warren Buffet said: “Rule #1: Never lose money.  Rule #2: Never forget rule #1.

What you do today can help improve your retirement income tomorrow.

The problem is not dying - it's living.  As long as you are living you and your spouse will need income.

With an annuity, you can run out of money, but you'll never run out of income. 

Have your advisor position your money so you will not suffer the same losses as in 2008.  Also prepare for retirement distributions of your money by using an income summary statement.

Please let me know if you have any questions.

Thanks,

Cory Payne

Beehive Insurance Retirement Planning Services

302 West 5400 South #101

Murray, UT 84107

801-685-6860 Office

801-685-2899 Fax

cpayne@beehiveinsurance.com

No Do-Overs in Retirement?

If you are retired or planning to retire in the next decade, there are steps you can take now to avoid an income death spiral in the retirement years. 

A few years ago my wife and I redecorated our office.  We painstakingly decided on what we thought was a mild green wall color.  After the paint dried we were shocked with our choice.  We went back to the store and selected a green two shades lighter and repainted the room.

I was not happy about re-painting the room at the time, but it was not a very painful process to do over.  I was lucky.  And the room turned out just the way we wanted.

Rarely are there “do-overs” that turn out well in retirement.  It’s important that sound financial decisions are made all along the path.   

#1  Failing to Have an Income Plan:  “If you fail to plan you plan to fail.”

So many people I talk with are just going to “wing it” in retirement.  They have $500,000 to $1,000,000 in retirement assets and plan on a “spend down” of their money.

A couple recently was leaving work having a combined income of $100,000 annually.  Now Social Security will only be paying them $30,000.  They were planning on spending down of their assets.

Filling their income gap by using $70,000 per year of their $600,000 retirement nest egg will be spent down before age 75, and if there is a stock market crash much sooner.

If you run out of money in retirement, what's your plan B? Live with your children?  If you plan properly your retirement assets can serve you until you leave this existence.

Most Retirees don't monitor and control their spending.  Start now to understand your annual income needs.

Create a budget.  Even a simple budget can give you a picture of where you’re headed.  Plan your income and how your money can safely serve you best. Plan for the death of a spouse and see how much your income will go down.  How will you replace that lost income? 

Get an income summary from your advisor outlining how and when they are going to utilize your current investments to ensure a successful retirement.

If you'd like help with a retirement income summary please feel free to contact me.

Cory Payne
Beehive Insurance Planning Services
302 West 5400 South #101
Murray, Utah 84107
cpayne@beehiveinsurance.com
801-685-6860

Do You Want Lifetime Income in Retirement?

Do You Want Lifetime Income in Retirement?

Will you have a dependable income to sustain your lifestyle in retirement?

Do you want insurance against general stock market declines and poor individual investment decisions?

Would you rather have a financial product with a 4% guaranteed return rather than a product offering 8% that could lose value due to market downturns?

Do you want money safety with upside potential?

Do you worry about going to your daughter-in-law or someone else to manage your finances in retirement because you’ve run out of money?

Do you always want to get a check in your mailbox every month until you pass away?

Do you have enough money to sustain the retirement movie you’ve seen playing in your mind?

If you can build an income stream that you cannot destroy, and buy it in way you won’t lose your principal whether you or your spouse lives or dies, would you want that?

Want retirement income that you don’t have to worry about?

To most people it's all about money safety an income during retirement, insurance provides this safety and income.

D Cory Payne

Beehive Insurance Retirement Planning Services

302 West 5400 South #101

Murray, Utah 84107

801-685-6875 

Women and Finance... The Latest Statistics

Women and Finance... The Latest Statistics

I was talking with a lady recently who said she didn't worry about retirement income since her husband took care of everything.  I asked, "How much income will you have during retirement?" She didn't know.  Was she worried about running out of money? She hadn't thought about it.

I suggested she involve herself a little more in the retirement process since there is a large probability she'll have to manage the family finances sometime in the future.  This leads me to share some statistics that I provide to my clients.

According to the Social Security Adminstration: 

90% of women will be responsible for their own finances at some point

A 65 year old female has a 42% chance of living to age 90

Women live 4-6 years longer than men in the United States.

What's the average age of widowhood in America?   59.6  Source: US Census Data, 2011

By 2030, 66% of US fortune will be in the hands of women. Source: Harvard Business Review. 2009

Women control over 60% of the personal wealth in the United States.  Source: Catalyst 2012

75% of nursing home residents are women with costs averaging $75K per year.  Source: Metlife Study on Finance and Female Executives, 2010

Nearly 80% of the total spending in America is controlled by women.  Source: 2009 Boston Consulting Group

7 out of 10 women say the need professional help managing their finances.  Source: American Association of CPA's Study, 2010

50% of women acknowledge they need help managing retirement.  Source: IRI Study on Women and Retirement, 2011

Regardless of net worth, homelessness is the number one fear of Ameican women today.  Source: Fiancial Advisor Magazine.

Running a close 2nd in fear is worry about running out of money as a result of over investment in cash.  Source: IRI Study of Women and Retirement, 2011

Women are typically Savers and desire Freedom and Peace of Mind.

My job is to make sure I'm meeting the income desires and needs of both the wife and the husband. I want to understand how you'd like to live during retirement and help you accomplish those goals.

I have partnered with one of the top income planners in the country and can now map out your entire retirment income on one easy to read page.  Through the use of this proprietray software, we are able to clearly illustrate how each guaranteed income source (Social Secuity, Pensions, etc.) will interact under varing life circumstances - such as layoffs, loss of pension, or the death of a spouse.

As a courtesy, I would like to extend my personal invitation for a private Retirement Planning consultation which will include your personalized "Income for Life" report.

Please contact me (Cory Payne) at cpayne@beehiveinsurance.com or 801-685-6860 so we can set up a time.

Cory Payne
Beehive Insurance Retirement Planning Services
cpayne@beehiveinsurance.com
801-685-6860

How do you Protect your Money?

How do you Protect your Money?

A major concern for many of my clients who are nearing retirement is how to protect their hard earned money from future down turns in the market.  Did you suffer a loss in 2008?

According to the Federal Reserve, between 2007 and 2010, median U.S. household net worth Dropped by 39%.

People nearing retirement should be smarter about managing the market risk in their retriement accounts if a drop in networth is concerning to them.

Clients who are relying on their 401K's and other retirement accounts may be glad to know there is a safe way to protect savings from "market corrections".  I dislike the term market correction, that's what my former financial adviser called it when I screamed bloody murder over my 401K losses.

What you can do to protect your 401K is request an in-service withdrawl (take your money out of your account and place it somewhere with no market risk).  You request a direct rollover of the money you want protected to an IRA with an insurance company.

Typically at 59 1/2 and older you can request a direct roll-over of your 401K funds from an employer sponsored program into an IRA.

There is no tax penalty for moving money from your qualified 401K to a qualified IRA.

I quote from a January 6, 2014 Money Market article by Steve Vernon called "How Long Will Your Retirment Saving Last?"  "One way to avoid running out of money before you die is to buy an annuity from an insurance company, which guarantee's you a monthly payment no matter how long you live and no matter what happens in the economy.

Unfortunately, many people don't buy annuities, but instead keep their savings invested in the stock market and make withdrawals to cover their living expenses.  Another mistake is not having a formal plan for withdrawing money......."

For many clients using and in-service withdrawal from a qualified plan to fund a fixed indexed annuity with a guaranteed lifetime retirement income benefit is a good way to protect at least your basic financial needs when you retire.

This provides a secure lifetime income with money in your mailbox every month.

Make sure to seek good financial advice to choose the appropriate fixed indexed annuity for your circumstances.

Please feel free to contact me with any questions.

Cory Payne

Beehive Insurance Retirement Planning Services

cpayne@beehiveinsurance.com

801-685-6860

Some Secrets to Understanding Annuities

Some Secrets to Understanding Annuities

Below are 3 annuity questions and the answers that I've recently discussed with clients.

Q.  All Annuites work the same, right? 

Mackinac Island

A.  Not at all.  Most people think of annuities like this: I get a payment every month from my annuity for $3,000 and if I die my wife gets 1/2 of that amount or $1,500 per month and when she dies, the annuity dies.

That's how it used to be, but not today.

Today, You can get a payment for $3,000 a month and if you die your wife will continue to get $3,000 per month for as long as she lives and when she dies, any remaining money in the plan will go to your children/beneficiaries.

Since there are 10,000 baby boomers retiring each day, annuities have come a long way to meet those needs.  What we do in our appointment process is show you which one is best for you based on how much safe and secure income you desire.

Because we're independent we can show you many different companies.  Our clients love the learning process of how to retire successfully.

Q.  How come my Advisor didn't recommend annuities?

A.  Perhaps your broker doesn't spend all of his time working just with retiree's.  We have found that most people in retirement don't want their income to go up and down with the stock market.

Yes, people like all the gains of the market but the 55% market loss of  2007-2009 left many people wanting more safety and protecion for their money.  

Most retiree's like predictability and they like knowing that their income will not stop for the rest of their lives.  

Q.  The plan I've developed for myself works as long as the market returns 6% a year as it has for the last 100 years, why should I do your plan?

A.  Maybe you should not.  If you're comfortable taking risk, meaning spending your money as the market goes down, then maybe you're okay where you are.

Our approach works even when the market declines.  If you're comfortable with money in the market, you should have some of it there.  We beleive in protecting your income stream regardless of good or bad times in the Market.

If you have money something to remember is "risk is for those trying to get where you are already", don't mess it up.  Many people if they'll just not lose their money can have all their future income needs met in retirement. 

Successfully Retire.

Cory Payne

Beehive Insurance Retirement Planning Services

cpayne@beehiveinsurance.com

801-685-6860