A popular alternative to standard LTC insurance and refered to as a Linked Benefit product or Asset Based insurance (does not qualify for Partnership asset protection)
NEWS: Just announced State Life now has an indexed annuity with long term care benefits. Contact us for a quote.
Are you looking for a way to leverage your investments to include protection from the risk of expensive long term care?
Have you been turned down (declined) for long term care insurance or does you health prevent you from applying for long term care insurance?
If you answered yes may want to consider an alternative to spending down your own nest egg to pay for long term care.
There are different types of annuities with long term care benefits. These are single premium fixed annuities with a long term care rider designed to cover long term care expenses. These are not variable annuities.
These annuities will provide you with financial security and long term care peace of mind with extended care protection. (NOTICE: The annuity without health underwriting is unavailable at this time. Contact us and we will notify you when it is available again.)
There is also a Life insurance policy with a long term care rider that provides more benefits (higher leverage) than the annuity with a long term care rider. more information here.
There are two annuities with LTC that can provide access to long term care benefits and you can pay for in-home care. One of these annuities you must buy before your need care (deferred), one you can buy after you need care (immediate).
The best candidates for these annuities are:
- Those who are uninsurable for standard LTC or Life/LTC.
- Those already needing care.
- Those with existing annuities that can transfer money to an new annuity with LTC benefits without paying capital gains tax.
These are not investment or income annuities, if you want high interest or immediate income look elsewhere (guidetoannuity.com)
Q: What has changed since the Pension Protection Act?
A: Read about these changes here. (new window)
Q: But aren't annuities risky?
A: Not fixed annuities, they are similar to your bank's CDs, and no one has lost money on a fixed annuity. In fact they may pay a higher rate than your CD and Money Market account.
Q: How does this work?
A: Most clients simply reposition money from an existing CD, Money Market or Savings Account.
Q: What happens to the annuity?
A: It just keeps growing based on the interest rate of that specific annuity. If you should die at any time the annuity money (less any withdraws) goes to your beneficiaries.
Q: Can I use my IRA money or one of my old 401k's to fund the annuity?
A: For ages over 59 1/2. Underwriting required. If available in your state, you can do a 1035 exchange or "trustee to trustee transfer" to reposition the money to fund the annuity from a 401k/IRA account, even from multiple qualified accounts. Also spouses can share benefits with one spouses qualified money even if one spouse is under 59 1/2. Caveat: Using qualified money means your LTC benefits are taxable. Consider the Life/LTC, it is designed so that qualified money funded policy benefits are not taxable.
Click for a description of Qualified vs Nonqualified Money (new window)
Q: I have an existing annuity can I do a 1035 exchange?
A: Yes, it would be simply a rollover to a secure account that has the long term care rider.
Q: Can the owner of the annuity and the annuitant be a different person?
A: Yes, in fact boomers are buying this for their parents who are either uninsurable or long term care insurance is just too expensive because of their parents age.
Q: How much is the long term care benefit?
A: It depends on the type of annuity, whether it has underwriting, how much you put in the annuity and your age when you start the annuity.
Q: Is this available to anyone, everywhere?
A: The rider is available for those who have not needed or received care service within one year prior to the starting date. Not all products are available in all states. Check with us about current state and age availablilty.
Q: How do I find out if this is right for me?
A: Thousands of Americans just like you have decided to protect their nest egg and have long term care benefits with our annuity. Call us, email us or fill out our online form and one of our licensed specialists will answer all your questions.
Notice: Variable Annuities with a Nursing Home Waiver. Many of these are sold with the idea that someone can access their money penalty-free if you need long term care, but be aware of what is required to qualify, it may only be used for nursing home and not for home care, Alzheimer's facility or assisted living.